Zite has confirmed that it has been acquired by CNN. The sales price is rumored to be in the $20 to $25 million range. Zite will not be branded exclusively to CNN and will become a wholly-owned subsidiary of the news network.Personalized iPad magazine application
It is an interesting play by CNN. Zite is a powerful news reading iPad app with a lot of excellent functionality. It operates almost like a "Pandora for news" that gives users serendipitous resources based on inputted interest and usage. Yet, outside of being a cool iPad app, Zite is driven by some interesting technology that could be of great use to CNN.
Zite takes many things into account when surfacing news. It integrates Facebook and Twitter along with inputs that readers are presented within articles. Yet, Zite is not just a feed reader or social aggregator the way Flipboard is. Zite's backend is built off of Worio, a social search "discovery engine" designed for serendipitous content discovery. As such, it crawls content as much as it uses direct feeds from users' social accounts.
Worio, as its own stand-alone product, did not take off. Yet, Zite pivoted from the search engine to Zite with now-CEO Mark Johnson as an advisor. Johnson will stay on as CEO and run day-to-day operations from the company's office in San Francisco while founder Ali Davar will remain the executive director and Mike Klass the CTO in charge of research and development. Anderson will report to KC Estenson, general manager of CNN Digital.
"When I became CEO of Zite, I was faced with a difficult choice: take venture capital and race to build Zite into a viable business or join forces with a large company and work with a larger pool of resources," Johnson wrote on Zite's blog today. "Despite many attractive paths in both directions, Zite chose to be acquired by CNN. We found a partner who shares our vision and our passion for building an incredible discovery platform."
To Remain Content Agnostic
Johnson also said that Zite will in no way promote CNN, Turner or Time Warner (which owns CNN) content. The platform will remain content agnostic.
"We see a trend developing here, one that is about the future of content discovery, and we believe that increasingly people will come to learn about new types of content based as much upon their personal interests and passions as they do the news of the day," Estenson said in a open letter regarding the acquisition.
In the history of news media, CNN seems to be the perfect candidate to take over a digital startup like Zite. CNN disrupted traditional TV news by launching the first ever 24-hour new network and CNN.com has been at the leading edge of technology and website design for the last several years. CNN now has a wing in its digital division solely dedicated to mobile apps, starting with the iPad and likely coming to other mobile platforms.
Zite had a little controversy upon its launch in March. It was sent cease-and-desist letters from a plethora of media companies that because of the way it stripped ads out of aggregated content. It rectified the situation shortly thereafter and Johnson was brought on board to be the CEO, replacing Davar.