What Verizon’s Acquisition of Yahoo means for Tumblr

By Chloe Hodge | @chloekhodge

On Tuesday, July 28th, Verizon announced its acquisition of Yahoo for a whopping $4.83 billion. Along with the purchase, the telecommunications company also obtained photo-sharing site Flickr and blogging service Tumblr.

Since its birth in 2004, Flickr, which allows users worldwide to manage and organize their photos and videos, has become a photo-sharing powerhouse.

According to Flickr’s website, the multi-billion dollar purchase will not affect Flickr- for now. In a statement posted on July 28, things will remain “business as usual” following Verizon’s purchase of Yahoo.

 

But, what will the acquisition mean for Tumblr?

Founded in 2007, Tumblr is a hybrid of a social networking site and blogging service. Users can post pictures, text, and other types of content effortlessly about virtually any topic.

Yahoo purchased Tumblr in 2013, with hopes of repositioning itself while the technology industry continued to shift into the social media realm.  At the time, the purchase was the largest acquisition of a social networking company in years- even larger than Facebook’s $1 billion purchase of Instagram in 2012.

Since that time, Tumblr was hardly on Yahoo’s radar. In fact, the company’s momentum plateaued. Currently, Tumblr is getting overthrown by much younger companies, such as Snapchat and Instagram.

Vice president and principal analyst at Forrester Research Shar VanBoskirk says that the acquisition will better allow Verizon to access consumer data and information.

“The advantage Verizon had against Google is it has offline access to information on what I’m doing, when I am watching cable or on my mobile phone,” VanBoskirk said. “Now, Verizon is positioning itself as an Internet giant.”

Though there is certainty that Verizon will utilize data from Yahoo’s 600 million users for advertising purposes, VanBoskirk doubts any major changes will hit Tumblr.

“I don’t think Verizon is even planning on how to use Tumblr at all at this point,” she said. “I don’t think Tumblr is a primary asset that Verizon is interested in.”

Others believe the purchase will make Tumblr Verizon’s own personal advertising hub. Robert Peck, an Internet equity analyst at SunTrust Robinson Humphrey, says that Tumblr being included in Yahoo’s sale will create a third platform of scale for advertisers.

“Right now, you only have two of them, which are Google and Facebook,” Peck said. “Advertisers are looking for another platform of scale that can reach mass audiences, and [this purchase] creates that.”

Verizon announced its purchase of Tumblr on Tuesday, July 28 for $4.83 billion. The sale marks an end as Yahoo being an independent company.

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