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Yahoo, looking to attract visitors and advertisers to its online news pages, purchased BuzzTracker, a site that ranks stories based on their popularity among bloggers.
Sunnyvale-based Yahoo acquired the Web company's technology and staff from Chicago-based Participate Media, BuzzTracker said Friday on its blog. Terms of the deal weren't disclosed.
BuzzTracker ranks more than 1,000 topics on more than 90,000 blogs, displaying the most-read and discussed stories of the day, according to its Web site. The technology will add to Yahoo's news pages and help it fend off competition from Google and sites such as Digg.com.
"As anyone playing in the online media space understands, online media is all about scale," Warms said on the blog.
Yahoo's news page attracted 35.2 million users in June, the most among similar sites in the United States, according to comScore. Google was sixth with 9.28 million, the Reston, Va.-based research firm said.
The acquisition includes "substantially all of Participate's assets," Warms said in an interview. The company has four employees.
The Wall Street Journal's Kara Swisher reported Friday on her blog that the BuzzTracker purchase price was $5 million, citing sources close to the company.
Warms and Yahoo spokeswoman Bahareh Ramin declined to confirm the price.
Locals make Yahoo! news Participate Media, a two-year-old Internet software and publishing company based in Lake View, was acquired by Yahoo for an undisclosed amount, and its owner, Alan Warms, was named general manager of Yahoo! News.
Participate Media developed BuzzTracker software that aggregates news, blog postings and other forms of Internet-based content from more than 90,000 sources. Publishers license the software, which can rank content according to what is most blogged or recently posted.
The four-person company also operates the Web site BuzzTracker.com.
Warms, 41, a Chicago-based serial entrepreneur, was named a Yahoo! vice president, and will move to Santa Monica, Calif. The company's employees will also relocate and work from the Yahoo! News headquarters. Yahoo.com is the most-visited Web site in the world.
"Anything in Internet media and advertising involves the ability to scale," Warms said. "We think we have the opportunity to bring in millions of users and thousands of advertisers."
Warms previously ran political news aggregator RealClearPolitics.com, which he sold in January. RealClearPolitics is a content partner of Yahoo, and technology developed for that Web site laid the groundwork for BuzzTracker. Accordingly, Yahoo management was familiar with the technology and in the process of negotiating a licensing agreement with BuzzTracker when it elected to acquire the company.
"This is very congruent with our strategy to make Yahoo an open platform," said Scott Moore, Yahoo senior vice president for news and information. "BuzzTracker augments our ability to search for the best of blogs and mainstream media by topic."
Warms founded his first company, Participate.com, in Chicago in 1997. That company, separate from his most recent venture, raised several million dollars in venture capital, and nearly went public before the dot-com crash in April 2000. Later named Participate Systems, it was sold in November 2004 to Boston-based OutStart Inc.
A native of New Jersey, Warms moved to Chicago in the mid-1990s to attend the Kellogg Business School at Northwestern University.
Warms said Yahoo was an opportunity he couldn't pass up.
"They are the biggest player in news," he said. "If you have the chance to join the New York Yankees you have to do it."