Search engine giant Yahoo has agreed to buy social blogging website Tumblr for a massive $1.1bn. The announcement came on the same day as the company launches its redesigned and updated Flickr page, which now also includes a massive 1TB of storage with every free account. The purchase is the latest in a long line of acquisitions for former Googler Marissa Mayer, now Yahoo’s chief executive and it will cost slightly more than Facebook’s purchase of Instagram while giving Yahoo a solid social and mobile platform to work from.
In one of Mayer’s first speeches she spoke about her plans to buy up a number of smaller companies in order to extend the features and user base for Yahoo. In just over six months, the company have purchased:
• Stamped – Stamped was purchased in October last year. The amount of the deal was not disclosed but all nine of the team were taken on to work in Yahoo’s mobile division.
• OntheAir – OnTheAir sold for an undisclosed amount and it was believed that the purchase meant that Yahoo would be moving into the video chat world.
• Snip.it – Snip.It was acquired for $10m in January. It is an app that snips or clips news articles in a Pinterest type format.
• Alike – In February, Yahoo completed the acquisition of Alike, a location discovery app for an undisclosed amount.
• Jybe – Another undisclosed amount was given for startup Jybe, which was actually established by a number of former Yahoo employees. It is a recommendation engine.
• Summly - The news summary app was bought from a 17 year old UK based student for £18m in March this year.
• Astrid –Astrid is one of Mayer’s more recent purchases, completing within the past month. The online to-do-list is set to be taken offline in the near future.
• GoPollGo – Financial details of the deal are not known but Yahoo took control of GoPollGo, the online polling service, immediately pulling their features from use.
• Milewise – The flight awards app was bought at essentially the same time as GoPollGo and it too was shuttered with its team joining the Yahoo team straight away.
• Loki – Loki Studios represented the fourth purchase in May as Mayer’s acquisition trail hotted up. No details are known but Loki is a location based game app.
Tumblr represents the biggest purchase to date by some way and all factors would point to Yahoo going more social, if not launching their own social network soon. They have social news aggregation, video chatting capabilities, mobile gaming, and geographic tagging systems but, in the series of earlier acquisitions, they also picked up a large team of experienced and successful entrepreneurs that could help change the performance of the company.
Yahoo said that they did not intend to “screw up” Tumblr like they did Flickr. They also believe that the purchase will significantly increase traffic and revenue. Some analysts believe the acquisition cost to be way too high but Tumblr has a growing and young audience, one especially geared towards mobile use as well as social sharing. This could provide a great starting point for a stronger social presence.