Today, leading publishers including The Washington Post and Time Inc. sent Vancouver-based startup Zite  a cease-and-desist  letter. In the letter, signed by nearly a dozen media outlets, publishers accused Zite of copyright infringement and called its iPad app, which aggregates and personalizes content from various news organizations based on a reader's interests, "plainly unlawful."
Specifically, publishers have taken issue with how Zite displays its content--reformatted for the iPad, without the publishers' original ads. But don't think this marks a nail in the coffin for Zite. The startup hopes it can help drive value for publishers, and believes the technology behind the app is enough to sustain its popularity in the meantime.
"The short-term plan is to comply with whatever the publishers' wishes are," says Zite CEO Ali Davar. "It's a matter of policy."
Now, when users click an article from a publisher like Time Inc., they'll be sent to Web mode--a pop-up screen that displays the content in its original format, advertisements and all. Before, Zite would cull the text from the publisher, displaying it seamlessly in the app for a better user experience--it's what what Davar refers to as Reading mode.
"We chose Reading mode for aesthetic and performance reasons," he says. "But Zite's principle value proposition is not its presentation layer--it's the quality of the recommendations."
Thanks to widespread attention, Zite has quickly became a hot name in the app world since its launch earlier this month, when it garnered roughly 120,000 downloads in its first week. Zite is based on years of research by the University of British Columbia's Laboratory for Computational Intelligence, and is said to learn as you read , creating a formidable competitor to similar news apps like Flipboard and Pulse.
"It's five years of R&D that's gone into presenting the best recommendations possible, and only several months of UI work," Davar says. "Overall, the look of the app is not affected, and it's still not entirely clear to us which view [Web or Reading mode] people prefer."
So, as splashy as headlines sound with news of copyright infringement and cease-and-desist letters, Zite is still very much up and running, and still hopes to foster dialogue with the media outlets it aggregates.
"We haven't really come to a clear position in terms of exactly what we want to do to provide publishers value, whether that's ad-sharing or some other scheme," Davar says. "The conversation we're having now with publishers is just an inevitability."
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