Yahoo was a name to conjure with.
It sat near the centre of many people’s internet experience. That’s no longer the case. Yahoo’s glory days are in the past.
In the time before Google, Yahoo’s directory was a popular jumping-off point for finding web content. Google sucked all the air out of that business and the rest is history.
Yahoo remains popular – especially in the US. Today it is a content portal. It has strength in a handful of areas including sport and entertainment news. And it owns the popular Flickr photo-sharing site.
Yahoo can’t be described as hip or happening. It looks fogyish. The company’s revenue has been in decline while its online rivals continue to grow.
Tumblr: the illusion of hipness
Tumblr, however, is hip. And happening. At times it can be edgy. It is popular with a younger audience than most of Yahoo’s current fare.
So spending over a billion dollars on the business could make sense. Observers expect Yahoo to find ways to make money from Tumblr. This looks unlikely. Until now Tumblr has not paid its way.
Yahoo’s challenge is to parlay all it gains from Tumblr back into the mothership without killing the hipper, younger brand. The company will want Tumblr users to link to its content channels and advertising is going to play a bigger role on their sites whether they like it or not.
Presumably part of the goal is for the lively social media blogging site to pump some adrenaline back into the tarnished Yahoo brand. There are some lucrative big data opportunities lurking in this mix as well as all those hip young things leave trails across the webs for Yahoo’s servers to mine.
The danger is that Yahoo will stifle Tumblr. That would be like watching a billion dollars flushed down the gurgler. It’s also the most likely outcome.