14 DAY TRIAL // Yahoo has bought Tumblr for a whopping $1.1 billion (€856 million), after the company’s board approved of the acquisition during a Sunday evening meeting.
The price is slightly higher than what Facebook paid for Instagram last spring, Wall Street Journal reports.
Since Yahoo has already announced they will be coming forth with news today, Marissa Mayer is expected to publicly confirm what sources have been telling the media for the past few days.
For the past year, Yahoo has been on a shopping spree, buying startup after startup and restructuring the company under CEO Marissa Mayer. After ten buyouts that didn’t cost the company too much, Tumblr is the largest item on her shopping cart.
In an effort to transform Yahoo into a place where young people want to be, the company has been focusing on strengthening its mobile platform. Furthermore, efforts for attracting young people have also been set in motion.
These involve some marketing campaigns but also buying out Tumblr, it seems.
The social blogging platform seems to be the best medium for Yahoo right now, since they have over 100 million blogs, most of them belonging to a young audience.
However, some questions remain after the buyout. While many of the startups the company has bought have quit their projects and simply went on to work at Yahoo, the same cannot be said for Tumblr.
According to some sources, the Tumblr brand will continue on in the wake of the buyout, with little to no modifications to it, other than a better integration with Yahoo’s services.
Tumblr CEO David Karp will continue to lead the company for the next few years, sources said. This means that his ideas about how to run Tumblr aren’t likely to change the direction in which the company is headed.
The acquisition isn’t beneficial only to Yahoo, but to the social blogging platform as well. The Internet giant will give Tumblr many distribution opportunities, especially as it struggles with its promise to not flood the blogs with advertisements.
Tumblr users have been quite opinionated about the buyout, especially since things don’t end well for most companies that undergo such a transition. Their biggest concern, it seems, is the way the platform is going to change.