“We promise not to screw it up,” Yahoo CEO Marissa Mayer wrote on her own newly-launched Tumblr blog. In true light-hearted Tumblr style, her post even included an animated gif illustrating the news.
Tumblr CEO David Karp also attempted to allay users' concerns with a bit of humor.
“We're not turning purple,” he said in a memo. “Yahoo is the original Internet company, and Marissa and her team share our dream to make the Internet the ultimate creative canvas… Plus, both our logos end with punctuation!”
While Yahoo said in a press release that Tumblr will be “independently operated as a separate company,” the deal will mean changes for both entities, one a fading Internet giant and the other a popular start-up that has struggled to make money even as it attracted millions more users last year.
With the acquisition, Yahoo hopes to reach a younger and wider audience, grow Web traffic, tap into a fast-growing social network, and expand its search offering. Mayer has been trying to revitalize Yahoo, which has struggled to compete with the likes of Google and Facebook, since she took the top spot at the company last year.
The transaction also offers more resources to Tumblr, including advertising opportunities. Once opposed to advertising, Tumblr began placing ads on its platform last year, generating $13 million in revenue. However, sources told The New York Times that the fledgling company burned through $25 million in cash last year and struggled to raise more money, which may have prompted deal discussions with Yahoo and others.
To hold onto Tumblr's millions of loyal users, Yahoo must stay true to its word and maintain the blogging site's energetic, creative spirit. It may follow in the footsteps of Facebook, which has so far shied away from placing ads on Instagram to avoid alienating users. Yet Yahoo must also figure out how to make a fun site profitable if it wishes to remain relevant in the shifting digital universe.