Entrepreneur On Yahoo/Tumblr: It's the Content Readers, Stupid 92
An anonymous reader writes "Weighing in on Yahoo's recent acquisition of Tumblr for $1.1 billion, social networking entrepreneur Adam Rifkin argues that Tumblr is extremely valuable business property because it has successfully organized itself around the 'Interest Graph' (people interested in the same hobbies or things), rather than the 'Social Graph' (family, friends, and coworkers/colleagues, as is typical for Facebook). He opines that, for a social networking site, readers are far more important than writers; writers, after all, 'have time but no money. Certain groups are going to be overrepresented: Students, stay-at-home moms, the underemployed, retirees.' While readers are just the opposite: they 'have money but no time.... They want to see a picture of a watch they like, and buy it now.' In other words, it's the readers of the content that businesses are trying to reach. And interest graphs can be specifically targeted by businesses, much more so than social graphs."
Re:So, we built an internet, the great infrastruct (Score:5, Interesting)
Every great infrastructure ends up being used massively for stupid reason. 90% of postal mail I receive is spam, but 10% is important. (YMMV). The same goes with internet.
Drop the social network crap and funny cat pictures, and you will find again what you are looking for in the internet: a large base of knowledge and communication between people. My four most visited website are: slashdot, jeuxvideo.com (a french video game website), wikipedia and arxiv. And personnaly, I feel just fine about the internet.
Fag packet figures (Score:4, Interesting)
The acquisition is priced at over $1billion. Max annual revenue for Tumblr is $13million projected to be $100million this year(high hopes that are highly unlikely, I predict $20million).
Yahoo! is paying through the nose for a highly unprofitable company with no hope of ever generating a ROI.
This acquisition is massive folly!
I am sick of this back of a fag packet figure being banged around. In November 2006, YouTube, LLC was bought by Google for US$1.65 billion(the largest at the time). Its argued today its worth http://www.valuewalk.com/2012/03/google-inc-goog-youtube/ [valuewalk.com] $45.7 Billion Ironically in the context of this article Google outbid Yahoo. In terms of numbers http://allthingsd.com/20100319/the-numbers-behind-the-worlds-fastest-growing-web-site-youtubes-finances-revealed/ [allthingsd.com] youtube revenue for the year before the sale to Google was $15,057 (whole making losses of hundreds of thousands each month)
I have no idea whether this is a good deal. But these figures are not of relevance.
Stop cutting a pasting from other sites and think for yourself (registering would be a good start too)
Re:Price vs. Revenue (Score:4, Interesting)
But if fits the new internet model of how you make money. Put in a few thousand hours developing (and promoting) an application that a large number of people find marginally interesting -- enough that you have a huge number of page hits. Then sell to one of the majors at a vastly inflated price, so your 10,000 hours or so of work is rewarded with a billion dollars.
Net pay rate if you succeed, $100,000 an hour.
Net pay rate if you don't succeed: $0/hour.
Who gets the big payoff is a total crap shoot. It's like winning the lottery, only the stakes are bigger. Who loses? The suckers you get to buy you out.
And it all goes to prove something I've been saying for years: Hard work and prudent investments will never make you rich. What will make you rich if finding a way to get paid for what other people are doing.