Yahoo Acquires Tumblr for $1.1 Billion
May 20, 2013 11:12 AM
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The Yahoo/Tumblr deal will close in the second half of the year
Yahoo announced today that it will acquire Tumblr under a new agreement -- and even promised "not to screw it up."
Yahoo will acquire Tumblr for $1.1 billion in cash, according to a Yahoo press release. Yahoo likely hopes to use Tumblr's position as a popular social media site to attract visitors to Yahoo's other offerings and bump up search use by integrating it into Tumblr.
Tumblr has over 300 million monthly unique visitors; 120,000 signups every day; receives 900 posts per second; users spend 24 billion minutes on the site each month, and more than half of Tumblr’s users are using the mobile app and do an average of 7 sessions per day.
The new agreement is expected to widen Yahoo’s audience by 50 percent to over a billion monthly visitors. Traffic is also expected to grow by by 20 percent.
“Tumblr is redefining creative expression online,” said Yahoo CEO
. “On many levels, Tumblr and Yahoo! couldn’t be more different, but, at the same time, they couldn’t be more complementary. Yahoo is the Internet’s original media network. Tumblr is the Internet’s fastest-growing media frenzy. Both companies are homes for brands - established and emerging. And, fundamentally, Tumblr and Yahoo! are both all about users, design, and finding surprise and inspiration amidst the everyday.”
Under the new deal, Tumblr will be independently ran as a separate business, with Tumblr CEO David Karp keeping his position. Yahoo also assures that Tumblr will continue catering to users on the site the way it always has (meaning, Yahoo won't interfere with a good thing).
However, Tumblr will use Yahoo’s search and personalization technology to help users find creators and content.
“Our team isn’t changing," said David Karp, CEO of Tumblr. "Our roadmap isn't changing. And our mission – to empower creators to make their best work and get it in front of the audience they deserve – certainly isn't changing. But we’re elated to have the support of Yahoo! and their team who share our dream to make the Internet the ultimate creative canvas. Tumblr gets better faster with more resources to draw from.”
Yahoo could certainly use all the help it can get. Mayer is looking to lead the company back to profitability after it lost ground to search giant Google. Mayer has made many changes, including the requirement for all telecommuters to
start working in a local office
or quit (which some saw as a way to announce layoffs without officially calling it a layoff) and the
axing of seven products from its line
back in March (including the mobile app for BlackBerry users, Yahoo Avatars, Yahoo App Search, Yahoo Sports IQ, Yahoo Clues, Yahoo Message Board website, and the Yahoo Updates API).
The Yahoo/Tumblr deal will close in the second half of the year.
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RE: this is
5/20/2013 1:04:29 PM
Aside from the fact that a lot of Tumblr blogs are about stuff that you really can't sell ads on, as I noted in an earlier post, one of the reasons Tumblr was so popular was because the guy running it was admittedly not all that interested in maximizing revenue - and to that end, there's not any advertising forced on Tumblr blogs.
Yahoo *has* to try to maximize revenue. In the internet world, that means advertising. And that means squeezing ads onto whatever blogs that aren't generally offensive to begin with.
Although I think there may also be ownership issues...like, if you have a Tumblr blog I'm not positive that the blog/content belongs to Tumblr - I think it might actually be yours. Which means that Yahoo probably can't put ads on your Tumblr blog without your permission, and probably without some kind of revenue sharing.
I can see this ending very badly for Yahoo.
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