Tumblr has just changed hands again, as part of Verizon’s acquisition of Yahoo under the rebranded Oath umbrella (re that name – someone’s definitely been watching Game of Thrones.) Although a here four years ago then Yahoo head Marissa Mayer paid $1 billion for a bunch of teenagers reposting pictures of Tom Hiddleston. Though the site is a vital nexus of internet thought and viral content, it has never made money, and it shares that with a lot of internet culture sites, NY Mag’s Brian Feldman reports:
It is rare, but not at all unprecedented, for a site to reach Tumblr’s size, prominence, and level of influence and still be unable to build a sustainable business. Twitter steers a huge portion of online culture, and has become an essential water cooler and newswire for journalists, tech workers, and otaku Nazis, but still has trouble turning a profit. Twitter itself shuttered its service Vine after just four years, even though the six-second-video social network had created more ubiquitous catchphrases and viral videos than any other social network over the same period. Reddit, the so-called “front page of the internet,” has been unable to fully capitalize on its enormous audience and influence, even after being purchased by Condé Nast (which it then spun out again; Condé Nast is very careful to specify that it does not own Reddit, though its parent company Advance Publications is a majority stakeholder). 4chan, whatever else you might think of it, is probably the most influential single website of the last decade, but its owner Hiroyuki Nishimura has said he is likely to shut it down. Even YouTube, which is synonymous with online video, still has trouble with profitability. As late as last October, CEO Susan Wojcicki was saying that the site was still in “investment mode” and that there was “no timetable” for profitability.
Like the dear departed Vine, and unlike the avaricious and cunning Facebook, Tumblr has never data mined, which is where the real money is, and ads on Tumblr are problematic because of all the pornographic content.
Maybe more importantly, Tumblr and Vine and the like never had data-mining operations as sophisticated as, say, Facebook. That’s why most of the advertising money in the industry has drained toward Facebook, which has 2 billion users, mounds of data, and can better assure advertisers of content cleanliness. Facebook is instructive: It’s less a place for creation or debate than it is for hosting all of the nitty-gritty, more boring data about your life. For much of its life, Facebook aggressively trafficked not in collecting rage comics and funny video clips, but in collecting bland lists of favorite movies and where you went to college — personal information that it can use to target ads with alarming specificity. And by selling ads against people’s identities, rather than their creative content, the company has churned out impressive profits, and given a wider impression that an ad-supported content platform is viable. (One of the great ironies of Twitter’s and Tumblr’s inability to make sustained profits is that Instagram and Facebook are both full of videos and posts screenshotted and stolen from their more productive, less wealthy rival platforms.)
Is Tumblr going to…go away? Its early competitor and a similar service Posterous already did. Feldman suggests Tumblr’s survival is entirely dependent on how much money Verizon want to sink into trying to make it profitable. Which means that a vast, vast ocean, an entire galaxy of precious, precious internet history is at risk.
But then so is everything that isn’t one of the Big Five. We can’t live in an Underpants Gnome limbo forever. If you haven’t figured out how to make money yet, you probably aren’t ever going to.
But then, they said the same thing about webcomics, and this very blog is hosted on Hiveworks, a web publisher for webcomics that makes a good bit of money for its hosted comics. So there are exceptions and escape routes and possibilities. But this frontier of free platforms isn’t going to last forever. Another wake up call for the business plan of 2027.
Heidi MacDonald is the founder and editor in chief of The Beat. In the past, she worked for Disney, DC Comics, Fox and Publishers Weekly. She can be heard regularly on the More To Come Podcast. She likes coffee, cats and noble struggle.