Pierre Omidyar, the founder of eBay Inc., has tapped the former editor and publisher of the defunct Rocky Mountain News to lead his new Hawai'i online news service.

John Temple, 56, will become the first editor of the yet-to-be named news operation, which will be launched during the second quarter, Om-id-yar said at a news conference yesterday.

"We've taken a big step today, laying the foundation for Peer News in Hawai'i," said Omidyar.

"We're fortunate to have someone with his background building and leading our news operation."

Temple headed Denver's 150-year-old Rocky Mountain News, which shut down Feb. 27.

The paper won four Pulitzer prizes and numerous other national awards under his leadership.

During a telephone news conference yesterday, Temple and Omidyar provided few details about the new venture's business model.

But they did say the news service will operate on a for-profit basis and will focus on public interest and civic matters affecting Hawai'i's communities.

Temple noted that the size of the operation will be comparable to online news operations such as the Voice of San Diego, which employs about 13 journalists, and MinnPost in Minnesota, which largely relies on content from outside contributors.

The newsroom will employ a small team of paid journalists but also rely on content generated by local citizen journalists.

Temple said he's looking to hire an assistant editor and reporters who are tech-savvy and have a proven track record in investigative reporting.

"I've always said that there's a critical role for journalism in the public interest that can be best met by a sustainable business model," said Omidyar.

Alan Mutter, who writes a blog on the news industry called Reflections Of a News-osaur, said the combination of professional and amateur news gatherers — the so-called "pro-am approach" — has been tried by a number of recent Mainland online news services with little success.

But Mutter, a former newspaper and cable television industry executive, said Temple's news industry background and Omidyar's financial backing could change that.

"John is an extremely talented editor who has gotten religion on how the media has to change in this new world," said Mutter. "If anybody can figure things out, he could do a very good job at it."

Temple headed the Rocky Mountain News editorial operations for 11 years.

He oversaw the newspaper's coverage of events such as the shooting at Columbine High School, for which the newspaper earned a news photography Pulitzer Prize in 2000.

The newspaper also earned two Pulitzers in 2006, for feature writing and feature photography.

The Rocky Mountain News was Colorado's oldest newspaper before its shutdown last year.

Omidyar, 42, has been a Honolulu resident since 2006. He attended Punahou School in the eighth and ninth grades before his family relocated to the Mainland.

In 1995, he founded eBay and still serves as chairman of the Internet auction company.

Forbes magazine recently estimated his net worth at $5.5 billion.

Last October, he and his wife, Pam Omidyar, pledged $50 million over six years to local nonprofits in one of the largest-ever charitable gifts in Hawai'i.

The launch of the new service comes as the local and national newspaper industry has been hard-hit by the global economic downturn and competition from online classified services such as Craigslist and Monster.com.

In addition to the shutdown of the Rocky Mountain News, the Seattle Post Intelligencer shut down its print edition, sharply reduced its staff and became an online-only publication.

Rick Edmonds, a media business analyst for the Poynter Institute in Florida, said a number of online news services have been launched in recent years in wake of the news industry's downsizing.

A majority are nonprofits or have a blended revenue base that includes advertising income and large donations from wealthy individuals. Most aren't making money, he said.

What's different here is that Omidyar is pursuing a for-profit model.

A startup like that could take some time to earn a profit, added Edmonds, who cited the examples of USA Today and ESPN, which lost a lot of money for a number of years before becoming profitable.

"I think it's a big challenge," he said.