DigitalScirocco Rolls Out of Stealth, Creates New Marketplace for Web Content

3/22/10Follow @gthuang

Bruce D’Ambrosio wants to change the way content and services are distributed on the Web—and how people make money from them. His new startup, Seattle-based DigitalScirocco, is emerging from pseudo-stealth mode today at the semi-annual DEMO conference in Palm Desert, CA. The company’s service has been live for a couple of months, but has been kept pretty quiet.

It’s a big vision, and here’s how it works. Right now, if you’re a publisher or website owner and you want to post outside content on your site—an article, photo, or song, say—you have to go to a source like Getty Images, or a media organization, and either buy the content manually, arrange to pay them through a business development process, or agree on some other deal. DigitalScirocco has set up an automated marketplace for connecting these website owners with content owners. Through an online auction process, websites can pay for the kinds of content they want—and discover the kinds of prices they want—while DigitalScirocco gets a piece of each sale.

A dress designer, for example, might want to automatically post some relevant articles from Vogue on its site to make it stickier and help drive traffic. The idea is that DigitalScirocco would help the designer get a good price on fresh content, and also would help Vogue make more money from its articles—all by connecting Web publishers with content owners in a new way.

“The issue right now is, those connections are broken, in part because everyone has lost their way in the illusions that [website] locations are content and monetization is about advertising,” says D’Ambrosio, the company’s founder and CEO.

He stresses that DigitalScirocco is not directly interested in the advertising part of the equation. It’s not an ad network. Rather, the company is trying to help enhance websites so they can give consumers a better experience, while helping content producers—media organizations, entertainment sites, finance sites—make more money. From a consumer’s point of view, it’s an alternative to subscription models or micropayments; in effect it gets website owners to pay for content, with the idea that consumers will buy other things from their site.

D’Ambrosio is an experienced entrepreneur who holds an emeritus faculty position in computer science at Oregon State University; his specialties include artificial intelligence, machine learning, and real-time behavior modeling. Previously, he founded Prevision and sold it to Fair Isaac (now called FICO) in 1997. More recently, he founded CleverSet, a developer of statistical technologies for e-commerce sites, and sold it to Art Technology Group for $11 million in 2008. (That was based on about $3 million invested and less than three years of company work.)

I asked him how DigitalScirocco could fundamentally change the Web. “I’m interested in taking away some of the authority from the [website] to be the complete feudal lord with total dictatorial control over his domain,” he says. “That doesn’t work anymore because peasants can go away in a click. What I believe needs to happen is there’s participation between [website] owners to draw visitors, and the visitor community, and infrastructure.”

Whether the infrastructure that DigitalScirocco provides is enough to get lots of buyers on the website-owner (publisher) side remains to be seen. Publishers will want any new content to drive up their sales and advertising revenue; D’Ambrosio says his team is giving them more creative control over their sites. But there seems to be demand already from the content-creator side: the company is announcing new partnerships today with Thomson Reuters, VentureBeat, and BeDynamic.

DigitalScirocco currently has seven employees, and has been on the fundraising trail since last year. “The goal is not an eyeballs and traffic play, it’s a revenue play,” D’Ambrosio says. “We’re focusing on finance, travel, and technology as initial topic focus areas to build up a critical, defensible marketplace mass.”

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com. Follow @gthuang

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