Yahoo! Acquisition Of Tumblr Gets Them Fresh Street Cred

May 20, 2013

11:15 am

Today as we reported earlier, Yahoo! agreed to acquire New York based microblogging platform Tumblr for $1.1 billion. The bold move by Yahoo!’s CEO Marissa Mayer, which she announced on her Tumblr with an animated gif, has been the subject of analysis from just about everyone. For some, the billion dollar price-tag generated serious sticker-shock, while others thought that Facebook should have swooped in to snatch up Tumblr to hedge their bets.

I think buying Tumblr is a smart move by Yahoo! if their strategy is to be a product company as opposed to a straight media company. They have not done much in the social space since acquiring Flickr & MyBlogLog. Flickr missed a huge opportunity to be the next great social network by lack of forward progress & improvements since being acquired in March 2005. Flickr was the Instagram of the web. They missed a huge opportunity as they failed to offer a mobile application till long after others had taken to that space.

Yahoo!’s move to buy Tumblr will give them access to a coveted audience that not only likes to surf the web & post animated gifs of Justin Bieber, but real content too, as lots of brands like Coca-Cola, NPR, Disney-Pixar and Warby Parker (as well as Tech Cocktail) are using the platform to extend their marketing and some of the most famous memes to hit the Internet have leveraged Tumblr as their vehicle of choice.

This move may have been loosely compared to Aol’s acquisition of Bebo, but I can easily say that Tumblr has a more vibrant offering than Bebo ever did. To be current, it compares much more closely to Facebook’s acquisition of Instagram, as they allowed the mobile photo network to remain an independent brand and community with light integrations. Marissa explained that Tumblr will also remain independent (though time will tell). This is great news as the platform should be allowed to continued to innovate and not have to be pulled into slower development cycles that Yahoo! might be used to.

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Frank Gruber is the cofounder, CEO and Executive Editor of Tech.Co (formerly Tech Cocktail). He is the author of the book, Startup Mixology, Tech Cocktail’s Guide to Building, Growing, and Celebrating Startup Success. He is also a startup advisor and investor to startups.

Find Frank Gruber online and follow him on Twitter at @FrankGruber.

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