AOL Leads Group of Investors in Start-Up

Time Warner Inc.’s America Online agreed to lead a $16.2-million investment in Brightcove and become the first Internet service provider to give its customers access to the closely held company’s online video library.

AOL was joined in the investment by Hearst Corp., owner of Esquire and Cosmopolitan magazines, and New York investment bank Allen & Co., as well as two other investors.

AOL will gain access to programming from Arts & Entertainment and Oxygen networks, AOL spokesman Nicholas Graham said. Brightcove, based in Cambridge, Mass., will allow video publishers to add shows to its library and set pricing over the Internet, Graham said.

Also, Brightcove named Barry Diller as a director.