Verizon is selling blogging site Tumblr to Automattic, the parent company of other blogging site WordPress, the companies announced on Mon
- Verizon is selling blogging site Tumblr to Automattic, the parent company of other blogging site WordPress, the companies announced on Monday.
- The financial terms of the deal were not announced, but according to Axios, the price was less than $20 million– a remarkable discount to the $1.1 billion that Tumblr sold for in 2013.
- Automaticc will take on 200 Tumblr employees as part of the deal.
- Visit Business Insider’s homepage for more stories.
Verizon is selling blogging site Tumblr to Automattic, the parent company of publishing site WordPress, the companies announced on Monday.
Automattic will take on 200 Tumblr employees as part of its deal with Verizon.
Automaticc CEO Matt Mullenweg said in a statement on Monday that Tumblr, which has 475 million blogs on its service, represents an “iconic” brand known for helping people share ideas, culture and experiences.
But the fire-sale price of the deal underscored how far Tumblr has fallen from its heyday, and the nearly insurmountable challenges facing consumer web companies trying to mount a comeback.
Verizon Media CEO Guru Gowrappan described the Tumblr sale as the “culmination of a thoughtful, thorough and strategic process.”
A billion dollar sale and then a downard spiral.
Yahoo paid a premium price for Tumblr in 2013, hoping Tumblr’s younger users could revive the fortunes of its aging web portal. But the $1.1 billion deal was deemed excessive even at the time, given that Tumblr barely generated any revenue. And as Tumblr’s popularity faded in the following years, as larger sites from Reddit to Facebook proved more adept at attract and retaining traffic, Yahoo was forced to write off hundreds of millions of dollars for its acquisition.
Automattic oversees several publishing companies in addition to WordPress, including long-form site Longreads, a comment filtering and tracking service, and an avatar generator.
The deal is subject to customary closing conditions.
This article is from Inc.com