Tumblr and the End of the Eyeballs-Are-Everything Era
Tumblr
and the End of the Eyeballs-Are-Everything Era
With an
adult-content problem and only the vaguest idea how to make money, Tumblr was
easy prey for trends bigger than itself
By Christopher
Mims August 17, 2019
At its apex, Tumblr had more users than both Instagram, now
estimated to be worth close to $200 billion to parent Facebook , and Pinterest , which
has a market cap of nearly $18 billion. In 2013, Tumblr sold to Yahoo for
$1.1 billion. On Monday, the parent company of WordPress.com bought it for a pittance.
The precise amount is hard to pin down but insiders have
observed that there are modest homes in Silicon Valley that might be comparable
in price. Marissa Mayer, Yahoo’s former chief executive, once described Tumblr as an
“incredibly special” property with “105 million different blogs, 300 million
monthly unique visitors and 120,000 sign-ups every day.”
“We promise not to screw it up,” she famously added. And now
look where we are.
Tumblr was ostensibly a blogging site but it quickly became one
of the dominant, if hard-to-navigate, social networks of the early aughts. It
attracted users who made and shared memes, art, their random thoughts and,
eventually, a sense of community. Its mechanisms were opaque to outsiders: For
many years, it didn’t have a function for direct messages or even traditional
commenting, forcing users to communicate with each other by, among other
things, reblogging each other’s posts.
Since it was difficult or impossible for outsiders to insert
themselves into conversations, and because it was and still is a place that
allows pseudonymous accounts, the site felt safe for members of marginalized
communities, says Alexander Cho, a postdoctoral fellow at the University of
California, Irvine, who coedited a forthcoming book on the history of Tumblr.
“Tumblr can be as anonymous as you want it to be, and that
allows people to share in a way they might not on Facebook,” says Catherine
Holderness, Tumblr’s senior community trends analyst.
But inherent in Tumblr’s structure, culture and even code base
were, from the beginning, problems for any potential owner. On the business
side, it operated under the assumption that it could make money off its users
the same way people had since the invention of the banner ad: Build a big
enough audience, and “monetization” will take care of itself.
Alas, Tumblr was inherently ill-suited to advertising, says
Katrin Tiidenberg, a social-media researcher at Tallinn University in Estonia
who has studied Tumblr for years. Its impenetrability was a challenge to
advertisers. On top of that, many of its users interspersed their posts on
various fandoms, obsessions and memes with sexual content. “A lot of
advertising clients, particularly in the U.S., get disproportionately nervous
about being seen next to someone’s boobs,” says Dr. Tiidenberg.
Advertisers instead turned increasingly to the ostensibly safer
realms of Google and Facebook. Together, the two giants now suck up 57% of all digital ad spend,
according to eMarketer. In addition to owning the biggest ad networks, their
crown jewels are incredibly sophisticated advertising engines that drive
measurable results for advertisers.
As these titans matured, they could attract the best engineering
talent, the most advertisers, the most eyeballs and the most partners, riding a
flywheel made of cash that spins faster and faster.
Yahoo, which hemorrhaged talent throughout the 2010s at both the
engineering and executive level, couldn’t attract and retain the sort of people
that could help its revenue-generating engine, that is its ailing ad network, to compete.
More or less the same thing occurred
once Yahoo joined AOL, sorry, Oath—oh wait, I mean Verizon Media—whose parent
company essentially wrote down its entire value to zero
in late 2018. Eyeballs, which this combined network had plenty of, weren’t enough
in a climate in which advertisers had moved beyond the kind of cut-rate
programmatic display advertising its sites were running.
The same thing happened in media, of course—such as the
“newspaper” you’re reading now—and the response was a massive shift away from
display advertising and toward subscription revenue.
But actually charging people to access its services was never
really an option for Tumblr, built as it was primarily on the hopes, dreams and
countless blog posts of teens all over the world. Kids often don’t have credit
cards, and even if they do, they’ve been raised on a steady diet of free games,
free video and free services.
It also doesn’t help that Tumblr, never a very polished or
particularly reliable service to begin with, had a hard time going mobile.
That’s where Google and Facebook ended up moving—quickly, through acquisitions
and manic development—to maintain their revenue growth.
“The site was just fundamentally broken; it broke all the time”
says Klaudia Amenábar, a senior media producer and comics vlogger who is also a
self-described Tumblr power user. Now 24, she found the service at 16 and has
been on it ever since, building a career in fandoms and social media from what
she learned there. “The mobile app is a lot better now, but before, jokes about
the mobile app were rampant on Tumblr,” she adds.
In the past year, Tumblr’s traffic has dropped by more than 40%,
from approximately 640 million visits in July 2018 to around 380 million now. Much of that
drop happened after the service
implemented a ban on adult content.
Before the ban, Tumblr grew large precisely because, like the
internet, it was open to the point of occasionally being seedy. The fact that
it was riddled with adult material might have been a draw for some audiences
and a turnoff to others. Its parent company Verizon launched a mostly automated effort to purge the
service of all adult material, a dragnet that also eliminated much of the
user-curated and user-generated content on the site. At that point the site
collapsed, as its massive communities of fan-fiction writers, outsider artists
and moody teens led their own exodus to other platforms.
“It was a long time coming,” says Ms. Amenábar. “A lot of people
just stopped using it because they got older, Twitter became
more popular, Instagram became bigger.”
Tumblr, still a powerful engine of internet memes and other
ephemera, is potentially retro-cool but certainly not as cool as it was during
its heyday. It’s like an old car that might become a classic if its owner can
hang onto it long enough. That’s why its perch in the same family as
WordPress.com is entirely appropriate.
WordPress.com is committed to supporting an
activity—blogging—that can seem quaint in an era where if something isn’t
shared on social media, it didn’t happen.
It’s entirely possible, as we saw with vinyl, wooden toys and
email, that blogging—and, by extension, Tumblr—could make a comeback, or at
least hang on as a valuable place for more thoughtful creation and engagement.
The real scandal of Tumblr isn’t that it’s now worth a fraction
of its former selling price. The scandal is that Tumblr was ever valued so
highly at all. Having a very popular product and only the vaguest idea how to
make money on it does not, it turns out, a world-changing business model make.
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