Cnet reporting:
The Zite buy is clearly seen as a strategic move at this point. It's the first acquisition of its kind CNN has ever made and the company has no intention of squeezing revenue from it any time soon. There are no ads on the service, no plans to add them, no "overt monetization" at all. The eight-person Zite will remain a separate business, based in California, with its own leadership and team. Estenson plans to give Zite air cover so it can develop its technology "without venture capital pressure." The business model, he says, will come later.
It's also clear that CNN could learn from Zite's tech team. CTO Mike Klaas gave me a primer in how Zite picks stories for its users. It uses not just the "velocity" of a story (that'd be "trending" to people in the Twitter ecosystem), but social proximity for recommendations. It picks stories for users based on retweets and reposts from people not just closely connected on social networks, but also who have similar interests, determined by their public social network behaviors. While CNN plans to keep Zite independent, I expect the company will attempt to bring some of its technology to the main CNN site.
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