Slashdot Mirror
Yahoo Pinkie-Swears It Won't Ruin Tumblr
Nerval's Lobster writes "Yahoo has agreed to acquire Tumblr for $1.1 billion. As you know, Yahoo is a major corporation with a need to monetize its assets in a way that makes its shareholders happy, leaving open the question of whether it'll alter Tumblr's DNA in order to make the latter more of a significant cash generator. But at least for the moment, Yahoo seems content to leave its new property alone. 'Per the agreement and our promise not to screw it up, Tumblr will be independently operated as a separate business,' read the company's press release. 'The product, service and brand will continue to be defined and developed separately with the same Tumblr irreverence, wit, and commitment to empower creators.' Tumblr CEO David Karp, who has been known to make some very anti-advertising comments in the past, will remain in place. Even so, anyone who likes Tumblr may have some cause for concern, because Yahoo has a history of making high-profile acquisitions that subsequently implode. Back in 1999, for example, it paid over $3 billion for GeoCities, another blogging network that it eventually shut down after years of failing the update the property. In 2005, it acquired popular photo-sharing Website Flickr, which it likewise allowed to languish and die. That same year it bought Delicious, a popular Webpage-bookmarking site, and did exactly nothing with it. So when Yahoo starts off its Tumblr press release with a promise not to screw things up, it's a self-deprecating nod toward all that history. New Yahoo CEO Marissa Mayer has been on a bit of a buying spree of late, snatching up startups such as Summly in an attempt to make her company 'cool' and relevant."
That this article suggests GeoCities was a blogging network tells me this was written by someone who never visited sites hosted by GeoCities.
Really though, Y! has a horrible track record. The question is, will enough users stay to keep it viable? Will they trust Y! enough to keep putting their efforts as users into the site?
In SOVIET RUSSIA... erm...NSA AMERICA, the Internet logs onto YOU!
The news of Flickr's death has been greatly exagerated ...
Ok, let's take a look here: Tumblr, pre-aquisition, made $13 million in income with reported costs of $25 million. So, they are losing money, surprise, surprise...
Yahoo comes along and sinks $1.1 billion into the company. Unless they are total fuckwits(a possibility that cannot entirely be ruled out), they are going to want to squeeze that cash back somehow, whether directly by 'monetizing' the Tumblr userbase, or by some farcical theory about a halo effect drawing users to their other properties...
In what possible universe is a service that is going from "VCs are paying you to use it" to "Yahoo wants to scrape 1.1 billion dollars out of you" going to improve? At best, it might improve in an absolute, technical, sense; but be accompanied by a subscription fee or something. More likely, we'll start to see increasingly aggressive frog-boiling attempts at upping the advertising, theme microtransaction, and other revenues.
They might realize some incremental efficiencies in terms of web hosting costs, given Yahoo's volume and datacenter operations experience; but unless Tumblr's previous management was wholly incompetent, they were probably already using the cheapest commodity web platforms they could get their hands on, so I find it very hard to believe that there is enough fat to cut to magically fix the situation without end-user pain.
Yahoo is where the Internet goes to cash out and die.
I was skeptical at first - I was thinking she was buying shit up like what's her face at HP years ago for the sake of buying shit up.
Then It downed on me. What do all of those websites have in common?
Registered users. Many of whom with real and pretty accurate personal profiles.
Merge all that data together - not hard at all - and BINGO! She's got a multibillion dollar portfolio of people's profiles for ...wait for it .... aaw man! ...
Yeah, that's right, for marketing shit.
She's gonna out "Facebook" Facebook.
Flickr is a tremendous service, I use it frequently, as do many many other people from around the world. It has a huge community of more serious photographers and amateurs alike.
Just because it isn't "the big thing" anymore doesn't mean it is dead.
It's only going to be left alone if it can make giant piles of money and Yahoo management doesn't think they can boost some other property by linking them together.
Given that Tumblr is currently not profitable and Yahoo management most definitely thinks they can use it to boost their other properties, a promise that it'll be left alone isn't worth the paper it's printed on.
-- "So they told me that using the download page to download something was not something they anticipated." - Bill Gates
the VC's just got their 10x payday. what happens after that is irrelevant to them.
"whether it'll alter Tumblr's DNA in order to make the latter more of a significant cash generator"
Perhaps they could first make Yahoo a significant cash generator, and when they have a proven method for that, THEN apply it to Tumblr and other properties.
I see mundane things in bed bath and beyond, 12$ for the shower curtain or 250$ for a window treatment kit. People just shrug and pay. The very same people pick a flight that is 10$ cheaper but needs an additional stop and 3 more hours. All the price maximizing optimizing strategies by the airlines have created a sense that" my fellow passenger probably paid 10$ less for the very same ticket" and that changes the way people shop and decide. All these social networks are going to find it difficult to make money off their users.
In a country like India where piracy is rampant and no one wants to pay anything for any kind of music, video, movie or software, the telephone ringtones are raking in several hundred million dollars to the phone companies. So how users arrive at a consensus fair price is a very difficult thing to understand or predict.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
As previously noted, "Slashdot Editor" Nick Kolakowski is once again promoting his own "Business Intelligence/Cloud" opinion pieces under the guise of the fake user Nerval's Lobster. He's simply trolling for pageviews, as he does just about every weekday... but this one is particularly shameless, as he's writing something almost no one will believe about a story we discussed yesterday. It's almost like his day consists of reading the comments of slashdot stories to see what deeply-seated opinions he can play off the next day to justify his job.
Don't feed the troll. Don't comment on stories "submitted" by Nerval's Lobster.