It’s been a long and winding road for Tumblr, the blogging site that launched a thousand writing careers. It sold to Yahoo for $1.1 billion dollars in 2013, then withered as Yahoo sold itself to AOL, AOL sold itself to Verizon, and Verizon realized it was a phone company after all. Through all that, the site’s fierce community hung on: it’s still Taylor Swift’s go-to social media platform, and fandoms of all kinds have a home there.
Verizon sold Tumblr for a reported $3 million this week, a far cry from the billion-dollar valuation it once had. But to Verizon’s credit, it chose to sell Tumblr to Automattic, the company behind Wordpress, the publishing platform that runs some 34 percent of the world’s websites. And Automattic CEO Matt Mullenweg thinks the future of Tumblr is bright — he wants the platform to bring back the best of old-school blogging, reinvented for mobile and connected to Tumblr’s still-vibrant community. And he’s retaining all 200 Tumblr employees to build that future. It’s the most exciting vision for Tumblr in years.
Matt joined Verge reporter Julia Alexander and me on a special Vergecast interview episode to chat about the deal, how it came together, what Automattic’s plans for Tumblr look like, and whether Tumblr might become an open-source project, like Wordpress itself. (“That would be pretty cool,” said Matt.)
Oh, and that porn ban.
Interview transcript condensed and edited for clarity.
Nilay Patel: How did this deal happen? Did Verizon call you? Did they send you a 5G Samsung phone with a note on the screen?
That would’ve been awesome.
I’ve long been a fan of Tumblr, I’ve been using it pretty much since it started. There’s been some features on WordPress certainly inspired by Tumblr over the years, and I was bummed when it sold to Yahoo, which was 2013 now.
For $1.1 billion dollars.
$1.1 billion dollars. And I was very happy for the team. And I was a little relieved as a competitor, because Tumblr was so cool, and at the time Yahoo was not cool. But around this [deal], you know, I believe Verizon reached out to a number of folks, and also had a ton of folks incoming, because the news of Tumblr being for sale did leak to the Wall Street Journal a few months ago.
So I know that there was a lot of incoming, a lot of good bidders. I’m really glad that they chose Automattic to be the home for it, because I do believe that we’re the best place that Tumblr could be in terms of what we do, what we’re passionate about, what the teams already do. There’s a lot of overlap between WordPress.com and Tumblr. I’m really glad that this is how it ended up. It was a difficult process.
I want to talk about the future of Tumblr, but the purchase price was reportedly three million dollars. Can you can you confirm that?
I like how y’all just ask the same questions.
It’s the question, so A, I think I’m obligated. And B, it’s a pretty precipitous drop in value. So I’m curious if you can discuss that.
Sure. We’re deferring to Verizon on all the details there. It’s really up to them what to disclose or not.
I can talk more generally. I just did a blog post about this. Verizon is a company that does over $120 billion dollars in revenue. They got Tumblr through Yahoo, which then merged with AOL, became Oath, got bought, became Verizon Media. It’s something they inherited a few levels down.
Their top priority was not trying to maximize the purchase price — there might even be a corporate reason for the purchase price to be lower, for taxes or something. They were really looking for where the best home was going to be. That was really where we tried to optimize the deal, especially in terms of bringing over close to 200 people. We’re taking them all on. I am aware of some of the details of some of the bidders — you know they were not planning to keep much, if any, of the team going.
We did more of a Berkshire Hathaway approach: we really want to bring over the management team, take what was working well, which is Tumblr’s engagement,and grow from there.
Most people listening to a show like this are not in your shoes very often, where you go out and buy a legendary internet property. Describe what it was like going through that process.
Actually, people send us stuff all the time, so we look at at least a few acquisitions a week. Most are not a good fit.
There was a deck they had. We went over and met the management team and a few folks who work on the Verizon Media and Verizon side of things. I had some contacts at Verizon that I pinged separately. Then there was a diligence process to try to find out as much information as you can about the business. You talk about possible outcomes. You just kind of figure out what works best for both sides. We always approach deals from kind of a win-win. What I like to do is understand what motivates the other side, and what’s most important to them and then know try to find the intersection, the Venn diagram overlap of of what you’re able to do and what’s important to you.
So were you most engaged with Verizon or with Tumblr folks?
That’s actually a good question. Both. We both interacted with the Tumblr folks and it is kind of Verizon running the process. They have some extremely experienced corporate development and lawyers and everything.
Verizon? Lawyers? I don’t believe it.
I’ll say their lawyers are super good. Some of the agreements that came over were like whoa!
The team at Automattic is very tiny but powerful and we worked really really hard to make this happen. There was an exclusive period and then the deadline, and we got everything signed up on Sunday.
So the deal’s closed? Tumblr is an Automattic property now?
We are all signed. I believe that terminology is the deal is “subject to customary closing conditions.” So it’s going to take, call it a few months to actually transfer everything over. But now we’re all signed and agreed, so it’s basically 99 percent of the way there.
So that’s the deal. What do you want to do with it?
One of the things that really surprised me is I thought —as probably many do — that Tumblr had kind of died under under its variety of corporate parents. And then actually being able to see some of the numbers, including some the numbers post-when they changed the adult content policy. I was like, “wow, this has still got a ton going on.”
We’ll be able to talk about more of those numbers after the close, because I think they’re really really interesting. But like I said, it actually hasn’t transferred over yet, so I don’t want to speak out of turn. But there’s huge engagement. The people who love, love Tumblr use it every day. They have more daily active users than WordPress.com has monthly active users. They’ve really cracked a lot of the social side of it.
In terms of what we want to do, one thing that also impressed me was just the team, the people who are still there and working on Tumblr are really passionate about their community, about what this offer could do. I know that they have a lot of things that they want to launch and do — some that are even already fully built that — that while this process was going on, it didn’t really make sense to add new things that change your service.
It’s a very innovative team as well. Tumblr pioneered a lot of what later would show up on Twitter, Instagram, WordPress, all sorts of other places. So it’s always been a very creative team, and I really am looking forward to seeing that just unleashed.
I guess we’re still a corporate parent but we’re very friendly one, and we’re all about blogging, innovation, publishing communities. So I would love for Tumblr to become a social alternative. That’s in line with Automattic’s values around privacy, and freedom of speech, and publishing, but has the fun and friendliness of some of the other networks we use, but without that democracy destroying... oh, I don’t know what you want to call it.
I think you want to call it Facebook. Is that your goal, to go right at Facebook and Twitter with Tumblr?
No, not at all, because I think that we’ve always had some different models. Advertising is definitely something we’re going to explore, we do definitely want to grow Tumblr’s revenue. Right now they’re burning a lot of money. But long-term I would say I’m also super interested in experimenting with upgrades. Wordpress.com has always been an upgrade-centric model. It’s freemium: use it for free and then you can buy plans anywhere from 40 dollars to 450 dollars per year to get added functionality. I’m curious about turning on things like some of the e-commerce functionality we’ve been developing with Woocommerce, memberships., those things I think would be very, very interesting to the Tumblr community. So there’s just so much to unlock there.
Julia Alexander: The Tumblr community has watched as executives from Yahoo and Verizon came in and tried to grow something that they really didn’t understand. Famously in 2016, a Yahoo executive reportedly said Tumblr is the next PDF. It’s now a major joke in the community.
You’re coming in, you’re the new corporate overlord, how you’re going to prove that you know what Tumblr is and should be, in a way that doesn’t make them feel more alienated than they already are?
If anyone had nervousness now, I would just say look at Automattic’s 14-year history or Wordpress’s 16-year history. We have a long track record with these things, including building a lot of trust in an open-source community, which, by the way, is usually also very skeptical of any company at all.
But really I would love for people to judge us by our actions over the next 18 months. Call it two months to close, it’s going to be a few months of integration and the migrating data and servers and everything like that. But then after that really look at what happens and ultimately, that’s all I always want to be judged: by our actions.
Nilay Patel: Obviously Verizon decided that adult content was going away. You tweeted last night, “If people want big policy changes here, put pressure on the app stores of Apple and Google, no one else has any leverage.” What did you mean by that?
This is a very nuanced issue.
Every layer of tech policy is implicated in that conversation.
Yeah. And some people say, well do you need to be in the app store? Just have a web version. But apps really are it, and I believe Tumblr is one of the top 30 or 40 apps in the social networking category. It’s usually top couple hundred globally. So their app is a big part of how people interact with it.
And I don’t know if you’ve ever been through an app review process; we’ve even run into this on WordPress. They’ll search for porn. It’s not like it needs to be on the homepage or on the sign-up, they really look for it. And if they find something you can be taken down.
And, by the way, it’s arbitrary. Maybe they something you launched a year ago now they’re saying it’s not allowed. App stores can be kind of fickle. Not capricious, but it sometimes feels a little arbitrary. Honestly, I think if you’re going to be there, if you’re going be on the app store, you want to try to play by what they what they support.
The more nuanced and broader issue, which I think is affecting every place that has user-generated content, is that pretty much everyone has moved beyond saying, “hey, if it’s First Amendment, if it’s not illegal, if we don’t get a legal order to take it down we’re happy to host and promote it.” And now everyone is realizing, well, there’s a lot of stuff that’s not legal that you maybe don’t want to spread everywhere else.
When you talk about the adult content on Tumblr and the changes that they made, it’s really like four or five issues mixed in there. There was definitely spam. I was more active Tumblr user eight or nine years ago, and when I logged back to check it out, my feed was full of nude pictures that were linking to a spam site. This wasn’t had it wasn’t something I had subscribed to, but it was a tumblog that had been taken over by spammers and they were posting five times an hour with ads for some sort of chat site. Spam, essentially.
There is lots and lots of shades of grey in between, and I do definitely want to learn more. There’s been a lot of different communities on Tumblr and some of the baby might have been thrown out with the bathwater, so with any sort of policy or algorithm or AI or whatever that’s doing the filtering, you want to evolve it and make sure that you’re blocking what you say you want to block, and not catching legit content as well.
You could do that stuff on the web, you could evolve the content policy and make it maybe less restrictive there. But in the app you’d still be stuck inside of whatever Apple and Google want?
That’s my understanding.
You know another thing people ask is well, how do Reddit and Twitter or get away with it? Because both have tons of adult content. I don’t know. I’m actually curious.
I believe Reddit has a setting you do on the web, but then if you turn that off you can get more adult stuff in the app? But I wonder if that just works because Apple hasn’t noticed it yet, or if it’s actually something that is allowed within their policies. I don’t know.
I will say that overall, a really thriving home for adult content is probably best for a company or a website which is totally dedicated to it. I know a bunch of sites popped up after the policy change in December, so I mean that might be a better future versus someplace where there might be a gray line or an evolving policy.
WordPress is a huge platform for all kinds of creators. It has obviously different monetization models as you said. Entire massive media publications are hosted on Wordpress and individuals use WordPress. Do you expect that kind of scale for Tumblr or do you expect it to be more of a social network?
The primary user experience is going to be that social network. But there’s no reason that VIP or really high-end users of WordPress can’t tap into that social network and a really native beautiful integration.
One of the things that Facebook did after Cambridge analytics is they actually removed all their posting APIs. So you used to be able to post to WordPress and we would auto- post to Tumblr, Twitter, LinkedIn, Facebook etc., and they turned off those API is after Cambridge Analytica. No one really objected or talked about it too much, but effectively they turned off the part that allowed you to put external content into the Facebook news feed and everything.
That was actually a big change in how the open web worked because previously all of the social networks had had some sort of way to get things in and out. Tumblr for example used to have RSS feeds so you could follow things that weren’t actually hosted on Tumblr. I would love to bring features like that back because I would love for Tumblr to be a better part of the open web.
I want to create a place on the web which is fun and supportive and substantial. You’re an old-school web user — at one point blogging had a real magic to it. A frisson. You’d have blog rolls and links and people would follow and comment and you’d keep up with things and it was a really, really nice social network. But it also was totally distributed and people had their own designs, and all those sorts of things. I think we can bring some of that back and reimagine it in the mobile world which is where Tumblr is also super strong.
Julia Alexander: Tumblr also has a bunch of major issues. It’s seen a huge rise in extreme ideology on the platform, it has seen major issues around mass shootings and the way [some users] glorify shooters that [Tumblr has] had to address. It’s become a huge issue. I just feel like it doesn’t it talk about as much because it’s not as big as Twitter. Do you plan to actively go in and try to clean this up, or are you just going to leave it be in the way that Verizon has?
These are these are very very difficult problems. so I do not want to trivialize or say that anything, even if you work really hard on it, will be 100 percent. But at one of the things that excites me is that Tumblr has a great trust and safety team, and so does the rest of Automattic that works on WordPress.com. These teams have a lot of overlap, and I’m looking forward to them working together. One of probably the first things that we’ll try to harmonize across acquisition is just say, “Hey, we’re doing 99 percent similar work. Let’s make sure our policies are consistent.”
Tumblr has some really amazing automated tools that we don’t have on WordPress.com that work really well. And what have we navigated with the nuance of content that people host on Wordpress, and how can we use that to inform and really encourage a healthy community on Tumblr as well.
Nilay Patel: Do you see these platforms coming together? I get the sense that you intend to keep them apart, which makes sense: one is that a very user-centric social network, the other is a publishing platform. But do you do you envision them coming ever closer together, or just more on the policies, procedures, backend stuff?
I think there’s a lot of overlap in what both do. I would love for them to interoperate. I do believe that long-term there’s an opportunity to merge backend technology so that Tumblr is actually powered by WordPress. WordPress, we think of as the open web operating system — it powers 34 percent of web sites now. It should be able to power everything that Tumblr does, but what I would call the Tumblr app, the user experience, the dashboard, that will always be its own unique thing and evolve in its own way because it is something distinct from everything else on the web. That’s what I think is the most interesting thing about Tumblr: it’s a unique, iconic brand that I’m looking forward to being around for decades to come. It has something that’s just a bit different.
It’s funny because almost every social network evolved to incorporate forms of blogging. There was microblogging, photo blogging, audio blogging which is podcasting. These are all kind of forms of things that were originally pioneered on blogging. Yet all of these things have become so balkanized. I think it’s very, very interesting to see if you can bring them together a bit, as Tumblr post formats do.
What kind of experience people can create for themselves, and really make it something where they choose what they follow? They’re not just being algorithmically pushed whatever is the most incendiary thing that might be in their feed.
I’m getting some like strong Google Reader vibes from you. Not that you’re going to build an RSS reader. But it’s still lamented that it’s gone; it was the application that brought together an entire ecosystem of blogs. Is that role something you can fill?
There’s something super valuable there. When you think of time well spent online, when you think about people getting more control over how they put their attention and their time. Think about their data: are they investing their data into a place where it can come back out? Where it benefits them as much if not more as it benefits whoever is hosting them or whatever software they’re using? Do they have true ownership?
These are all things that never go out of style. We have peaks and troughs of openness on the web. I think we are exiting a trough. If you think 2016 was the peak of the closed social networks and proprietary software, we are seeing incredible growth of open source, of distributed systems, whether that’s in information, whether that’s in blogging, with money, with crypto and everything related to that. These are powerful revolutions that are going to play out over the next 15 to 20 years, but it’s only going to go up from here.
This is also my life’s work. I’ve worked on this for 16 years. I hope to work on these issues literally the rest of my life. So I want to keep working to create the kind of web that if I ever have children that I want them to grow up with.
Julia Alexander: You said you wanted to introduce more advertising to Tumblr.
I don’t know if “more” is the best word. But I do think that the advertising they did do is significantly lower than what you would expect. It makes it significantly less than what you would expect for the amount of traffic and audience.
Tumblr is such a niche audience — it gets away with being so weird. That’s why people still love it. It’s weird whether it’s fandom, or it’s just weirdness in general. Do you worry that bringing in ads will affect the community?
I think there is an opportunity there. My understanding is right now most of the ads are programmatic, which means network ads.
It’s not where, say, movie studio or a specific advertiser who really understands the Tumblr audience is saying “this is who we want to reach with a message we want to target to them specifically.” So, that’s an experiment, of course. But I have high hopes that the weirdness —what I would describe as the beauty of the Tumblr community — is actually really, really appealing. And we should do a good job with advertising. Now I will also couch that by saying Automattic is not an advertising company. We’re a subscription and upgrades company. So perhaps the advertising thing doesn’t work out, and it’s all more subscription-based. I think that can be really healthy and really positive as well.
Nilay Patel: How do you think about the relationship to creators? Is there a way to empower and compensate the creators? Tumblr is such a force of culture. Is there a way to give back to it in a way that isn’t just a transfer of value to BuzzFeed?
Let me talk about what we do for that on WordPress.com. So one, we have Wordpress.com upgrades you can buy and get additional customizability. And yes, it’s a cost, but you can get so much more power and control over your site, including things like your own domain name. It’s not bad, you know, it’s a week worth of Starbucks or something. It’s not a huge investment for your complete online presence.
We have a program called WordAds that allows people to run ads. We essentially bundle everyone together, we can do really advanced things like header bidding and other things to ensure quality and do a revenue share. So you can have your own ads on the site and make money from that traffic. We’ve also been launching features around monetization or e-commerce. So there’s a simple payments button, there’s some membership stuff that’s launching soon, all the way up to full e-commerce. There’s store’s that do over $100 million a year in annual revenue built on Woocommerce.
So from the simple PayPal-like pay me now button, all the way up to sophisticated stores, are things that you can do on WordPress. And we see literally north of 10 billion of transactions a year ago through that, and growing fast, so I would love to open some of that up to the Tumblr community. These are things we’ve built already.
How it fits or works for Tumblr is really going to be up to that team. You know they understand that user base and that community better than anyone else in the world. So I’m very curious to see how some of the raw materials and the technical things that we’ve already built inside the rest of Automattic, how they think that will fit best with the Tumblr community. I personally would be really excited about memberships or some sort of recurring payment.
Are you going try to integrate your engineering teams or are you going to leave them alone at first?
We’ve done a few acquisitions like this before. You want to integrate gently: look at where things make sense and do that first, show success, and then start to expand.
Long term, like I said, there’s a lot of overlap between WordPress.com and Tumblr. There’s also a lot of things that are totally different, and I could see being independent forever. But especially from an engineering point of view I am excited to build more things using React and APIs that might actually be reusable across them. So even though we could have some some code sharing across apps. As you know WordPress. com including Calypso, which is our front-end, is a hundred percent open source. So that’s all there and we can see what kind of code sharing, or maybe what we can open source on the Tumblr side.
You going to open-source Tumblr?
That would be pretty cool.
How soon until Verizon’s weird ad-tracking pixels are gone from Tumblr?
That’s a good question. I would say, for all of those things expect things to be kind of the same until we do the close. Think of that being October. We’ll really start to look at our systems. So Automattic has an approach to GDPR, an approach to tracking pixels, we’re very privacy-focused company. We’ll really start to try to integrate what Tumblr does with what we found works really well on WordPress.com, Longreads, Simplenote, our other products.
You’ve spoken to the employees of Tumblr. This is an opportunity to talk to the people who use Tumblr, the community. What is the thing that you want them to know the most?
First, I’ll say thank you for using Tumblr and sticking with it. Second, I would say that I hope and believe that Tumblr’s best days are actually ahead of it. That as an independent company again, as part of an independent company, it has the opportunity to be responsive, agile, and creator-centric in a way it might have been constrained in some ways since 2013. So stick around. Try it out, and keep an eye out especially over the next six to 12 months for some of the new stuff that’s coming.