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It's Official: Yahoo Acquires Tumblr For $1.1 Billion, Promises Hipsters "Not To Screw It Up"
As has been rumored for months, and known for days, the official purchase of Tumblr by Yahoo is now in the books. For $1.1 billion, Yahoo is the proud owner of a whole lot of user-generated porn sites if not that much (read any) revenue. We cant wait to see how it monetizes them. And in a press release, apparently aimed squarely at hipsters, Yahoo promises "not to screw it up." It's cool to be hip and edgy: surely it's worth at least 15% in stock premium. As for profits... ah, it's an Amazon world after all.
From the official press release
SUNNYVALE, Calif. & NEW YORK--(BUSINESS WIRE)-- Yahoo! Inc. (NASDAQ: YHOO) and Tumblr announced today that they have reached a definitive agreement for Yahoo! to acquire Tumblr.
Per the agreement and our promise not to screw it up, Tumblr will be independently operated as a separate business. David Karp will remain CEO. The product, service and brand will continue to be defined and developed separately with the same Tumblr irreverence, wit, and commitment to empower creators.
With more than 300 million monthly unique visitors and 120,000 signups every day, Tumblr is one of the fastest-growing media networks in the world. Tumblr sees 900 posts per second (!) and 24 billion minutes spent on site each month. On mobile, more than half of Tumblr's users are using the mobile app and do an average of 7 sessions per day. Its tremendous popularity and engagement among creators, curators and audiences of all ages brings a significant new community of users to the Yahoo! network. The combination of Tumblr+Yahoo! is expected to grow Yahoo!'s audience by 50 percent to more than a billion monthly visitors, and to grow traffic by approximately 20 percent.
The deal offers unique opportunities for both companies. Tumblr can deploy Yahoo!'s personalization technology and search infrastructure to help its users discover creators, bloggers, and content they'll love. In turn, Tumblr brings 50 billion blog posts (and 75 million more arriving each day) to Yahoo!'s media network and search experiences. The two companies will also work together to create advertising opportunities that are seamless and enhance the user experience.
Total consideration is approximately $1.1 billion, substantially all of which is payable in cash.
"Tumblr is redefining creative expression online," said Yahoo! CEO Marissa Mayer. "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."
"I've long held the view that in all things art and design, you can feel the spirit and demeanor of the creator. That's why it was no surprise to me that David Karp is one of the nicest, most empathetic people I've ever met. He's also one of the most perceptive, capable entrepreneurs I've ever worked with," continued Mayer. "David's respect for Tumblr's community of creators is awesome. I'm absolutely delighted to have him join our team."
David Karp, CEO of Tumblr, addressed the Tumblr community, "Our team isn't changing. 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."
The transaction, which is subject to customary closing conditions, is expected to close in the second half of the year.
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Tumblr has no ads and a shit ton of porn. How can Yahoo NOT screw it up?
Sign up to download porn.....on purpose?
They spend a billion for a blog site, but not a penny to fix their totally-hacked email.
Yeah, it's different this time.
Another money-losing social network backed by hedge-funds sells to a big player and promises to be profitable "real soon", while the aquiring company promises "not to change it too much". This is MySpace part deux. Only more expensive, and less profitable than MySpace was.
Oh, and in this case the money-losing social network is full of porn and has (basically) no ads. And the aquiring company is a family-friendly, ad-driven brand run by an overpaid, widely ridiculed, inexperienced woman who has yet to develop a single new profit center for the company.
Let me guess: Yahoo thinks they can make it family-friendly, add ads and not lose users. Yeeaah... How'd that work out for MySpace? Actually, forget MySpace... even without the recent history this plan is idiotic at face value.
Consider what Tumblr actually is from a user perspective: Free hosting for your blog. Tumblr doesn't serve ads on members' blogs. So how does that business work?
Tumblr amounts to a free service, paid for by someone else. That's a great deal for users, and it's also totally unsustainable. Right now, you can get a blog on Tumblr, you can brand your blog so that the Tumblr brand is completely invisible, and they'll host it and serve it for you. Well shit...of COURSE they're successful. They're giving away free hosting for blogs! And not only that, you can insert your own ad-code and run a PROFITABLE blog on Tumblr! This is the most half-assed business model in the world. It isn't even a business model. It's an expensive and unsustainable recipe for growing users.
It's like saying, "I'm going to grow my beer business by giving away infinite amounts of free beer every day in the middle of Manhattan. And then, when I'm about $100 million bucks in the hole I'm going to sell the business for a cool billion dollars because it's so "successful". And besides, I've got killer brand loyalty."
So Yahoo is thinking, these users probably won't mind if we fill up their free personal blogs with our ads all over the place... right? Lulz?
What could possibly go wrong?
The implosion of YHOO hasn't even begun yet. This idiot CEO has her head deeply buried in her ass.
From the article above:
The two companies will also work together to create advertising opportunities ...
Heard on the radio that Yahoo's real interest is in the personal data of the millions of Tumblr users. They intend to mine it and exploit it for profit. They can do this without introducing ads into the Tumblr user experience.
Nice but how do you recoup a billion dollars that way?
Yahoo! ROFL good god yahoo = computer virus.
Sounds like a 'sweet' deal to me seeing's how 80% of Japan's GDP is porn. So it must be profitable if you know the business.
[PS: I made up the 80% number. It's really only 78.6%]
how do I find the porn??
Welcome to Tech-Crash 2.0
Everbody needs their own MySpace
Who's calling a top?
.
Wait... what? Ok, I'm sold...
But I still think Yahoo might have overstretched.
excuse me, I just joined tumblr... how do I find the porn? Thanks for your assistance.
Bwahahahaha !!! This is just wonderful! Another dotcom bubble, a housing bubble, student loan bubble, sub-prime GM bubble, and now a porn bubble...
What can't Bernanke blow?
He ain't touching me!
.
at the rate they are going marissa mayer will offer 1 billion dollars for the remains of xanga.
How could the board allow Marissa to buy Tumblr knowing what happened to Myspace, and Hi5 after their sales.
Buying out Reddit would have been better.
But f**ck sound money, cuz this is the Age of QE.
Well, at least when the .gov folks goes to investigate/intimidate/view Tumblroo, they won't have to change any bookmarks to the daily porn they watch!
What is a hipster?
According to my encyclopedia it's some guy that use to dance on Lawrence Welk.
The next obvious question is who the hell is Lawrence Welk?
"The next obvious question is who the hell is Lawrence Welk?"
He wrote the Fed's theme song:
http://www.youtube.com/watch?v=2aSJhb78R-o
Well played.
Men who are married to ugly ass women, no children, part of the programmer community, whose idea for a bachelor party is fucking lazer tag followed by bowling, then maybe some pizza and D&D as nightcap.
What's tumblr?
I guess the 1.1 Billion is more for their customer base then the actual blogger site.
Revenue of 13 Million last year, when are these clowns going to learn?
YHOO's new CEO might be worse than Yang.
I hear Johnson has finished his JCP remodeling, so he may be free to hire...
All they have to do is keep pace with inflation and in 90 years they break even.
Sounds like a good investment to me.
just monetize the sticky eyeballs. Wait, that sounds kinda gross in a Tumblr context...
You moms can't work at home anymore. But, if you want to take an extra half hour for lunch to support one of our clients, that's OK.
Anything that grows this fast, can die this fast.
http://www.engadget.com/2013/05/20/wordpress-72000-tumblr-defections/
Edgy?
Screwed must be an ironic reference to the fact that Tumblr is basically an amateur porn site; a whole lot of pictures and a couple of words (blogging). Oddly screwed is one of those words.
What is Yhoo (partnered with cnbc) going to do with all that porn.....Tumblr service agreement basically says "we welcome porn and are basically a "how to" manual for screwing".
As for "edgy".....everyone under 25 who uses tumblr as a "blooger" site, now googling Yahoo, to find out what the fuck it is.
I think Mark Cuban is laughing today after reading this news. Worst move by YHOO since Yang turned down MSFT's insane buyout offer. Deals like this scream of a market top.
I've had a tumblr for years. It's entirely pointless. The porn amounts to post-pubescent girls flashing their bits while holding up cards with some cultural marxist slogan or other daubed upon them. The text posts include 19yr old geopolitical experts whining about something.. I dunno what due to my olympic strength scrolling finger.
There's a niche for anything you can imagine. Populated by the same few dozen muppets echoing each other. For every niche a troll, which is passably amusing for a time.
Then there's the arty bollocks. Infinities of cool pictures. I recommend mindlessly scrolling your tumblr while watching particularly dry youtube videos that are good, just not good enough to hold all your attention.
So, populated by 95% cunts & boring people, but the 'follow' thing means you see only a stream of your own choosing. Cool site. Also, tits. Thousands upon thousands of tits.
Whats not to like?
I may be old and jaded, but I wouldn't even define what you wrote (people exposing themselves) as porn. Maybe in the 1960's when all we had was Playboy, but in this age of every cable series showing full frontal fucking? Not so much.
http://www.tumblr.com/tagged/topless+tuesday
http://www.tumblr.com/tagged/national+socialism
http://www.tumblr.com/tagged/social+justice
Protip; Only two of these links are awesome.
Well, that's it, then. Yahoo is committed to healthier lifestyles.
10 Minutes Of Staring at Breasts Daily Prolongs Man's Life by 5 Years
http://www.wholefitness.com/looking-breasts.html
If that's true, I should live to be about 175.
Unfortunately, it's not true, but I'm sure MM did her due diligence. (Does looking at boobs prolong a woman's life? - This really needs to be researched.)
I think they mean real-life breasts, not just pictures (because if that's the case I'll be living to 225)
David Karp, CEO of Tumblr, addressed the Tumblr community, "....But we're elated to have Yahoo's $1b and we'll come up with some real hip ways to spend it."
Buy Tide! Need a loan? Depressed? Try Paxil! Drive a new car from your local Ford dealer! We make it easy for you to qualify!
Yeah, we won't screws up anything. We's Promises.
I must be getting old. Never heard of Tumblr
Haha, me neither.
I clicked on this news just to see if I'm the only one - obviously not.
And I don't even want to find out what the fuck it does. Probably just another time black hole.
It's a huge, black hole, money pit.
Marrisa Mayer can't let Zuckerberg have all the fun paying $1 billion for worhtless web content.
"Hello, what does your company sell?"
"Uh, we don't sell anything, it's a free service."
"Well then, how do you make money?"
"We don't. But venture capital groups give us millions per year to run our business."
"So you lose money?"
"Yeah, millions of dollars a year."
"And you're still in business?"
"Yeah, business is never been better. We just got bought for $1.1 billion."
"How is that possible, you don't make any money?"
"We've got millions of users. They are worth tons of money."
"How? I mean they don't buy anything. What value are they?"
"How should I know. But Wall Street values users. If you've got an app that gets downloaded a hundred million times for free, you've got a billion dollar company."
"That's fucked up."
"Who gives a shit. I just got $1 billion."
"Tumblr employees have been told that the company only has enough funds to operate for a few more months, as its costs far exceed the limited revenue it earns. Tumblr pulled in $13 million in 2012, but has accelerated its advertising offering in hopes of hitting $100 million in revenue this year. The money’s not coming in fast enough to support its expenses though. Employees were recently told not to be concerned, though, because the company is expecting to be bought."
http://googlefeed.com/tumblr-may-reject-yahoos-11b-acquisition-offer-for...
rofl, sounds familiar.
Sell signals
With acknowledgements to Half A Billion and TruthInSunshine
Friday farce
Permanently high plateau (2:30 to about 3:30)
$1b for Tumblr
If Tumblr is worth $1.1 billion, what is Deviant Art worth?
Oh wait, that is a succesful community of real artists sharing tutorials, art, and design work. Also allowing talented indviduals to sell their work and land freelance jobs. It has been around since Dotcom 1.0.
I forgot, real websites aren't worth jack unless it can be VC'd into a billion dollar IPO.
Yahoo EXTREMELY HEAVILY censors its news and especially the people who contribute it is bulletin boards. Tumblr ... not so much.
I have three theories on why the purchase:
1. To squelch the free expression shown on Tumblr
2. To give the bankers a cover story for runnning up the Yahoo price ... because they need more pockets to stuff money
3. It is just a dinner table deal between the relatives of the two company heads ... passing money between family members, as it were.
Cynically I think that all three might be true.
I do not for a moment think that the Tumblr acquisition can in any way be a financial success for Yahoo.
If you don't finish high school you can go on to become a CEO of Tumblr! What does that tell ya?
First big test for Mayer.
Another machination to suck in more users to spin it back out to advertisers.
OK, let me get this straight, because I think I may have a deal for Yahoo.
They paid $1.1 billion for a company with 2012 revenues of $12 million. That's an 84.615 revenue to price ratio.
By that logic, I have a one site that pulled in $2400 just in Google Adsense revenue. There are other revenue streams, but I'm willing to offer my site to Yahoo based on just that one revenue center, for ($2400 X 84.615) $203,076.92. Deal. I can now retire.
Note that the sum Yahoo will be paying is for a site that I spend about three hours per month operating, so they may want to keep me on as CEO for, uh, $85K/year. OK, Marissa?
Now, here's my translation of elitist bitch Ms. Mayer's comments on the Tumblr press release.
"I've long held the view that in all things art and design, you can feel the spirit and demeanor of the creator."
I have no idea what I'm buying or what I'm saying.
That's why it was no surprise to me that David Karp is one of the nicest, most empathetic people I've ever met."
Who? Karp? Never met him, don't want to.
He's also one of the most perceptive, capable entrepreneurs I've ever worked with," continued Mayer.
I've just made him almost as rich as me. I might someday blow him just for fun.
"David's respect for Tumblr's community of creators is awesome. I'm absolutely delighted to have him join our team."
I love porn. I hope to make my own video with a midget, a horse and some zucchini someday.
Time for HP to buy Yahoo...a match made in heaven.
Marissa Mayer spent more time checking out which Yahoo employees work from home than she did on spending over $1 billion cash to buy Tumblr. For half that billion dollars cash, Mayer could have bought the entire Tribune newspaper company at a fire sale price. Then Mayer would be able to sell ad space online and in print media at the same time. Synergy is good.
A CEO who choses to use the word 'demeanor' when describing a minimalist founder of a site specializing in giving away borrowed money... scares me. Going to sell 'demeanor'? She sounds like a high-school disciplinarian. Equally troublesome, she claims Yahoo! was the internet's first "media company." This is Misperception 2.0. Yahoo! was a tech company that forgot it wasn't a media company. It built portal infrastructure and branding. Then it got lost. And lost again.
Now I get it. Marissa was probably posted on tumblr and they didn't remove her images so she bought it. :-)
Clever move, expensive one but still good one.
Typo: "Tumblr will be independently operated as a separate business" should read "Tumblr will be independently operated as a separate, money-losing, business."
AOL and Yahoo will be a match made in heaven.
Yahoo Back On Top After Purchasing Millions Of 13-Year-Old Girls’ Blogs
http://www.theonion.com/articles/yahoo-back-on-top-after-purchasing-millions-of-13y,32497/