In an effort to offer more personalized content and enhance its mobile device offerings, CNN has purchased Zite, a news app made for the iPad offering a magazine-like experience tailored specifically to individual users. Although Zite will continue to operate as a separate, standalone business, CNN is still expected to leverage the app’s technology to deliver its news content.
“Zite represents the next generation of content discovery and personalized publishing, and CNN wants to help lead in that space,” said KC Estenson, general manager of CNN Digital. “We think we can advance the industry in a meaningful way that helps content creators expand their businesses while growing the distribution of a product that people already love.”
Since Zite will continue to pull from a variety of sources across the Web, it seems curious that CNN would purchase the app and continue to operate its own app separately. Estenson, calling Zite a “curator” rather than an “aggregator,” said it became clear it was time for CNN to enter the aggregation game. CNN continues to draw its own audience, Estenson said, but so do other alternative sources, social recommendations and smart apps such as Zite. Estenson noted that contrary to CNN’s existing digital properties, Zite “is for when you're not in a heavy news mode,” calling it a “Sunday morning magazine.”
The acquisition is being seen as a strategic move without much revenue potential for CNN in the near future. The CNN team has already said it will give Zite the opportunity to develop its technology “without venture capital pressure” and a business plan to come later. Since this is the first purchase of its kind for CNN, the news powerhouse will get to choose just when and how to leverage what Zite has to offer its news-conscious readers. Meanwhile, Zite will have the freedom to grow without as much pressure to compete against third-parties.