Sinclair bought Circa assets for $800K in August, plans to hire 70 journalists, relaunch in spring 2016
Fresh useful insights … Mike Brown / International Business Times : Circa News Is Returning: Sinclair Broadcast Group Acquires Site For $800,000 Alex Heath / Tech Insider : One of the iPhone's first great news apps is being reborn Chris Welch / The Verge : Circa news app being resurrected with focus on original reporting and video Benjamin Mullin / Poynter : Sinclair announces plans to relaunch Circa Jonathan Kuperberg / Broadcasting & Cable : Set to Launch Digital News Site Circa, Sinclair Taps John Solomon as COO Dylan Byers / CNNMoney : Circa to get new life under Sinclair Tweets: Dan Gillmor / @dangillmor : Right-wing media empire (not Murdoch's in this case) bought Circa, and content will reflect corporate views. http://www.wsj.com/... Erik Hayden / @erik_hayden : Circa's new owner has grandiose plans: “We expect it to be as significant as Vice and Vox and Buzzfeed” http://www.wsj.com/... Adam Weinstein / @adamweinstein : Area Journalist Ventures Out In Search of Fabled Centrist Millennial Unicorns http://www.wsj.com/... http://twitter.com/... See also Mediagazer
Context & Ripple Effects
Circa spent 2015 running out of options: after launching a fully featured responsive website in February to broaden beyond its iPhone-native app, it failed to raise a new round and put itself up for sale by May. The buyer that emerged was not another tech company but Sinclair Broadcast Group, which quietly took the assets for $800,000 in August.
The relaunch plan now on the table — 70 journalist hires, John Solomon as COO, an emphasis on original reporting and video, targeted for spring 2016 — makes this less a rescue than a broadcaster acquiring a ready-made digital newsroom at fire-sale pricing.
First-order effects
- Sinclair must stand up a ~70-person editorial operation under COO John Solomon by spring 2016, converting an $800K asset purchase into a real payroll commitment.
- Circa's existing app-and-web product gets a second life with original reporting and video added, replacing the stripped-down, VC-starved version readers last saw.
Second-order effects
- Sinclair gains a centralized digital newsroom whose output can feed its broadcast stations, giving a local-TV group a national digital footprint it did not have to build from scratch.
- Other distressed consumer-news startups that, like Circa, could not close venture rounds now have a visible exit path: strategic buyers from broadcast, not follow-on VC money.
Third-order effects
- If the pattern holds, ownership of digital-native journalism drifts from venture investors toward station groups and conglomerates that buy failed startups' teams and brands cheaply — reshaping who funds and controls online newsrooms when ad-supported apps can't sustain themselves.
The trend: Venture-backed consumer news apps are exiting to broadcast groups at asset-sale prices, as strategic media owners replace VCs as the buyers of last resort for digital newsrooms.