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Back in the '90s, Yahoo! owned some of the hottest properties on the Internet. But by the end of the '00s, those properties were all Web 1.0 dinosaurs that had
by amyjess 7y ago
Back in the '90s, Yahoo! owned some of the hottest properties on the Internet. But by the end of the '00s, those properties were all Web 1.0 dinosaurs that had long been surpassed by modern platforms. They wanted that old relevance back; they wanted to buy a modern platform that was popular with young people and had a huge userbase and cultural influence.
And Yahoo!, being Yahoo!, never really knew what to do with that acquisition and just let it start to die on the vine, and when Verizon took over, they pissed away whatever goodwill they had left by gutting Tumblr.
- exogeny 7y agoSure, but that's not really a model, right? (Sorry, not to attack you.) I really hope the MBAs on the M&A team for Yahoo! didn't just say "Well, we used to be cool, but we're not anymore, so.." Tumblr was growing, but it was extremely young (read: low HHI, difficult to target, resistant to advertising) and extremely brand un-safe (read: impossible to monetize). So they had to believe one of four things: 1. The brand would grow into an older demographic, despite being not designed as such 2. Users would not leave in mass once brand-safety initiatives were to be put in place and/or advertisers wouldn't care 3. Some other business model would emerge, despite that not happening to almost any other similar consumer product ever 4. Display advertising would reverse the trend of CPMs plummeting and being sucked up by Facebook and Google I can't imagine any competent M&A analyst actually looking at Tumblr and the state of the Internet ultimately believing any of them, which is why the deal was hugely baffling then.
- derefr 7y agoI would presume that the business model for Tumblr is the same as the business model for Snapchat. Whatever the heck it was/is.