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One bad sign for Yahoo’s Tumblr buy: Its history of $1 billion duds

Published May 21st, 2013 7:05PM EDT
Yahoo Tumblr Merger Analysis

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Yahoo turned some heads this week when it announced that it was paying $1.1 billion to buy blogging platform Tumblr, but this isn’t the first time it has spent at least $1 billion to acquire another company. As NPR points out, Yahoo has bought several companies over the past 15 years that it has valued at $1 billion or higher, including most famously its $3.7 billion acquisition of GeoCities in 1999. Other failed Yahoo acquisitions include the $5.7 billion it paid for multimedia website Broadcast.com and the $1.63 billion it paid for search advertising pioneer Overture. In fact, all of these acquisitions make the $30 million that Yahoo paid for Flickr back in 2005 seem like a relative success story, since Flickr is still an operational service that the company is still pouring resources into. That said, when Flickr is seen as the best-case scenario for a Yahoo acquisition, it’s easy to see why Tumblr users are nervous.

Brad Reed
Brad Reed Staff Writer

Brad Reed has written about technology for over eight years at BGR.com and Network World. Prior to that, he wrote freelance stories for political publications such as AlterNet and the American Prospect. He has a Master's Degree in Business and Economics Journalism from Boston University.