Netscape, the brand that kick-started the dot-com boom only to lose the browser war to Microsoft, launched its latest reincarnation on Thursday with a portal focused on community-driven news.

The move reflects Netscape’s attempt to bring visitors back to the AOL-run site, which saw its number of unique visitors drop by 25 percent over the past year, according to comScore Media Matrix.

Netscape’s social news approach follows the success of startups like Digg and Newsvine, which are building businesses by aggregating news.

Digg already has 9 million page views per day and is profitable, according to CEO Jay Adelson. It’s growing with the help of a community of users who actively submit and rank news stories.

Like Digg, the retooled Netscape site will only feature stories that readers have submitted, and the stories will rise and fall on the page according to a combination of statistics like number of votes, comments, page views, links, and length of time viewed.

Unlike Digg and Newsvine, Netscape will also rely on several editorial staff members called “anchors” who will play key roles in ranking, monitoring, and guiding content that comes to the site.

The decision to retain some level of editorial control over the site is a way for a large corporation like AOL to use social media tools without risking some of the pitfalls of crowd-driven news. AOL and, importantly its parent, Time Warner, have good reason to fear missteps.

AOL bought Netscape for $4.2 billion in 1999, the year before the bubble burst, and within months merged with Time Warner in a deal originally valued at $165 billion. Together AOL and Time Warner had a combined market cap of $350 billion when the deal was struck, but Time Warner’s value today is only about $71 billion.

News Filter

AOL exec Jason Calacanis, whose two-year-old company Weblogs Inc. was acquired by AOL last year in a deal reportedly worth $25 million, was tasked with retooling Netscape (see AOL Nabs Weblogs Inc.). He said the anchors will help keep salacious or inaccurate news from reaching the top of Netscape site.

While Digg has a flagging system that enables users to report inaccurate or questionable stories, Mr. Calacanis dismissed Digg’s approach as “one dimensional.” AOL needs a more sophisticated tool, he said.

Digg founder Kevin Rose joked that Netscape’s editorial team might be there more to stop anti-AOL stories from hitting the top of the charts.

Mr. Calacanis said the anchors will act more as moderators than filters. None of AOL’s editorial content will be given preference over any other content that comes into the site, he promised.

Mssrs. Rose and Adelson said their site isn’t interested in adding an editorial layer. Newsvine CEO Mike Davidson concurred, saying: “Newsvine is philosophically opposed to editorial control.”

More than anything, Newsvine and Digg execs seemed eager to see Netscape’s launch. They said Netscape’s plans validate the markets for social news sites.

Mainstream MediaWhile the startups have the luxury of being able to let the crowd control the space, Netscape has to please both its 11 million unique visitors per month and Time Warner’s famously unhappy shareholders, who largely blame the acquisition of AOL for their stock’s long slumber. Keeping some level of control is a no-brainer.

And Netscape’s readers are very mainstream, compared to readers on sites like Digg, meaning they actively read all types of news across topics.

Digg readers pretty much stick to geeky tech stories, and are a select community of readers. For example, on Wednesday night the top story on Digg was leaked screenshots of Digg’s own third generation of its web site, which the company plans to release next week.

Digg execs said the upgraded version could help the site branch into the mainstream and could emphasize broader news categories, but would not specify details.

The leaked screenshots published by ValleyWag.com show new categories like “Business” and “World News,” suggesting Digg’s new version will try to target the mainstream reader.

Mr. Calacanis isn’t quiet about his admiration and praise of startups like Digg. He even said he tried to invest in the company several years ago. Digg’s Mr. Rose said the discussion was “more on the lines of he wanted to buy us.”Both he and Mr. Adelson said there’ve been many discussions with many media companies.

Interestingly, Digg received funding from Netscape’s original founder Marc Andreesen, an entrepreneur who has started several media businesses.  

Contact the writer:KFehrenbacher@RedHerring.com