VANCOUVER – A Vancouver based tech startup has been acquired by CNN.
Rumour has it the TV network doled out at least US $20 million to buy Zite, a “personalized iPad magazine that gets smarter as you use it,” but no official buy-out price was cited.
The free app lets users personalize the news they want and choose to consume. Zite aggregates content – from articles, to blogs, to videos — from a variety of publications and sites.
It also synchs with Twitter and/or Google Reader.
According to the company’s blog, the app was downloaded a whopping 120,000 times in the first week since its launch in March.
But it was not all smooth sailing for Zite.
Shortly after launch, the app founders were served a cease-and-desist letter by a group of media organizations who claimed they are not getting any page views or ad impressions when their content appears in Zite because the company strips their content of the ads and other data. They said Zite is reformatting, republishing, and redistributing original content, adversely affecting their business. But the company was able to reach a compromise by displaying stories from these organizations as web pages.
Get daily National news
Zite CEO Mark Johnson said in a statement today the acquisition by CNN is a milestone, but also a moment of truth for their eight-person operation, which will now have to relocate to San Francisco.
“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. 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.”
Johnson says CNN was natural choice for them, calling it an organization of “visionaries.”
Despite that, Johnson says their app won’t be biased toward CNN’s content.
“We will not promote CNN, Turner or Time Warner content in any special way: our agnostic personalization algorithms will be the sole determiner of what you see on Zite.”
As far as CNN’s plans for Zite, the network said in a press release they will operate Zite as an independent business. CNN also plans to promote the software on air and online.
The media giant has expended its digital reach in the last decade, investing in its online properties and pioneering the integration of social media into daily broadcasts.
Twitter: @yulst.
Comments
Want to discuss? Please read our Commenting Policy first.