Yahoo is discussing “strategic alliance and investment in or outright buy of” Tumblr, Peter Kafka and Kara Swisher reported Thursday evening.
Any such deal “could certainly bring Yahoo a big, young audience,” they write.
[Tumblr's] worldwide traffic was at 117 million visitors in April, according to comScore. On its home page, Tumblr claims it has 107.8 million blogs and 50.6 billion posts. U.S. desktop traffic to Tumblr was 37 million in April, close to LinkedIn and Twitter, although Twitter obviously has much more via mobile.
The blogging service “has positioned itself as one of the few players in the digital ad world that is well suited for brand advertising,” Mike Shields writes, saying a deal between the companies could be worth $1 billion.
Yahoo should be able to write a check, Om Malik writes.
[T]he value of Yahoo’s stake in Alibaba has gone up substantially as Alibaba’s continues to grow its revenues at a healthy clip. Yahoo owns about 23 percent of Alibaba and the Chinese eCommerce company is likely to go public and could worth as much as $100 billion in its post-IPO avatar. Yahoo is expected to sell about half its stake in the Chinese company in the likely 2014 IPO. Wall Street currently values Alibaba at around $70 billion.
Malik thinks Facebook might be interested in Tumblr, too. TechCrunch Co-Editor Alexia Tsotsis decides to “heap another dollop of speculation on top of this already absurdly speculative post.”
It wouldn’t be surprising if Google was also courting David Karp, as Mayer, a former Googler, still thinks like she’s in Google M&A, “Hey, a critical mass of people are using it … Let’s buy it and stick ads on it!.” Imagine what the social blogging platform could do to revive Google+ engagement and content creation … And how much more it would be worth to Google?