Flipboard, a popular news-reading and content-sharing application for tablet PCs that was one of the first of its type, revealed March 5 that it is acquiring Zite, an up-and-coming competitor, from CNN. CNN Money, Bloomberg and Fortune reported that the deal was worth about $60 million in stock.
As part of the transaction, Palo Alto, Calif.-based Flipboard said it is forming a new advertising and content partnership with CNN to utilize the international news network's content.
Flipboard describes itself as a "digital social magazine that aggregates web links from your social circle, i.e. Twitter and Facebook, and displays the content in magazine form on an iPad." It also works on Android tablets and is available from the Google Play site.
The name "Flipboard" describes the app well, since Web pages appear to "flip" from right to left and left to right like a book as the user sweeps a finger across a page.
CNN acquired the startup Zite in 2011 for $20 million. GigaOm reported that Zite's team of about 20 people in San Francisco will move to join Flipboard in Palo Alto, except for founder Mark Johnson, who wrote on LinkedIn that he is leaving the company entirely.
Neither company would disclose how many users Zite claims to have. However, Flipboard founder Mike McCue has been quoted as saying after three full years in business, Flipboard now has more than 100 million users and is adding as many as 250,000 new ones every day.
Flipboard raised $161 million in a Series C round of financing last year. The privately held company, founded in 2010, has been valued at about $800 million.