Will Yahoo! firesale Tumblr?2/24/2016
Going-out-of-business sales are a bargain shopper’s dream. If you’ve done your homework and strike at just the right time, a penny-pincher can walk away with deals that are absolute steals. While cheapskates and moneygrubbers live for these big scores, so do businesses. Whether it’s mega-banks swooping in during the financial crisis to strip-clean the carcasses of their collapsing peers, or Google milking Motorola for all its valuable patents before tossing it to the curb, bargains are loved, no matter the industry. Now the organization ready to be torn apart seems to be Yahoo!
Given its 10-year slide into a tech industry joke, Yahoo! has a surprising amount of valuable assets. Besides holding a large stake in the Chinese e-commerce site Alibaba, Yahoo! owns Flickr (one of the largest, longest running photo hosting sites on the web), Rivals (a major online sports journalism and entertainment magazine) and Tumblr. Flickr and Rivals have been well-oiled machines that have weathered its owner’s rocky years, but Tumblr has only been under the Yahoo! banner for three years, and there’s no certainty how these choppy business waters will affect it.
Started in 2007, Tumblr began as a more photo- and image-centric version of Twitter. Whereas Twitter became a popular outlet for journalism, entertainers and public figures, Tumblr developed into more of a microblogging site for artists and graphic-based web comics. Tumblr is also responsible for memes — photos overlaid with snarky block text that have polluted the Internet in recent years.
It’s ironic that Tumblr ultimately ended up being acquired by Yahoo!, as the services’ social media relevance are almost mirror images of each other. By the time Tumblr entered the social media scene, Facebook was already dominating, Twitter quickly became the hot new thing, and LinkedIn had snatched up the business networking market. Where it seemed Tumblr would nab the artististic world, Pinterest and Instagram swooped in and stole the show. Today, Tumblr is a network without a mass appeal public image. While its microblogging rival Twitter asserted itself into the media and broadcasting world with hashtags and “trending topics,” Tumblr has done nothing. The Tumblr of 2016 isn’t too different from the Tumblr of 2007.
So if Yahoo! does ultimately hang an “Everything Must Go” sign on its front porch, what does that mean for Tumblr? Flickr will go to a high bidder. Because it is firmly engrained in the online photo world and has a vibrant userbase, some tech firm will snatch it up in a second. Rivals will be bought for somewhere near its actual value. Few sites rival (pun very much intended) the college recruiting and actual sports journalism the site offers. But Tumblr? If it hasn’t proven itself a winner by this point, will it get the chance to become one? Doubtful.
For proof, look once more at Twitter. As loved as it is, Twitter is starting to lose users, and every earnings report it posts seems like a plea for help. If it is in trouble, what would-be buyer is itching to acquire Diet Twitter, i.e., Tumblr.
Tumblr may not the prettiest girl at the dance, but someone will ultimately dance with her. If you need evidence, look to Myspace, which hasn’t been cool in a dozen years, yet it somehow attracted Justin Timberlake as an investor. It seems second chances come to those with a recognizable name and millions of users — something to which Tumblr can relate, although it likely doesn’t want to be compared to Myspace, which Timberlake and crew picked up for $35 million in 2011. Now that was a tech bargain. CV
Patrick Boberg is a central Iowa creative media specialist. Follow him on Twitter @PatBoBomb.