Why Tumbler Lost Money

by Grace O'Shea

After purchasing Tumblr for 1.1 Billion in 2013, Verizon has now sold the app at an alleged loss of 1 Billion, 97 Million. Yes, that's right, Tumblr sold for only $3 Million (allegedly); costing less than a beachfront home in Sydney.

Has the app, once prolific for its ‘Tumblr Girls’ and seemingly lawless content fallen off the radar? The world has changed a lot since the site was founded by David Karpp in 2007, we’re all glued to smartphones that we’re yet to be conceived of. Not to mention, social media as an industry has grown to be worth $18.4 billion. So why has Tumblr’s worth decreased?

why tumbler lost money

It’s important for sites to have a competitive edge, with smaller sites like ‘we heart it’ having less users than Kim K has followers on Instagram. Both are visual based social media platforms, but have you heard of we heart it? Yeah, us either.

Since its birth Tumblr’s competitive edge has been its lack of censorship. The app, originally purchased by Yahoo in 2013, was later absorbed by Version, the latter’s new parent company, in 2017, at which point some changes started happening.

While other sites have received continuous user demand to #freethenipple, with facebook even conceding, the original ‘free’ platform was beginning to withdraw.

Throughout the december of 2018 Tumblr began to cull all sexual and pornographic content, including that which depicted female presenting nipples. On december 17th 2018 the site had been cleansed.

This was perceived by the media as a knee jerk reaction to the discovery of content depicting the sexual abuse of under aged persons. A discovery which subsequently lead to Tumblr being taken off Apple’s App store.

However, Verizon had intentions of shifting Tumblr’s community in a new direction from the beginning. Algorithms had begun deleting the more grotesque pornogfraphic content at random in mid 2017 - just to keep users on their toes.

Following this the sites ‘safe-mode’, which filtered out any naughty visual content, was updated to be ‘on’ as a default feature of any new blog. Though, it could still be disabled manually of course.

While the incident in late 2018 was definitely a fall from grace, revealing that Tumblr could care less about its users safety, it can’t be blamed for the sites depreciation. The reality is that sex sells, and Verison shot it’s own cash cow in the foot (hoof?).

But we’ve seen this narrative unfold before. In the mid 1980’s tape wars, the battle between VHS and Betamax, the former outsold the latter and ultimately conquered. Sure, the VHS had longer recording capabilities and more compact tapes but you know what else they had that Betamax didn’t? Porn.

In banning pornography the tele-communications mogul stripped Tumblr of its most lusted after asset. Arround 20% of the site’s traffic has, in the past, been related to smutty content; to the extent that PornHub was a potential buyer when the site went on the market.

Tumblr is now owned by Automattic Inc, the parent company of Wordpress, who are keeping a low profile about their plans for the apps future.