Verizon has agreed to sell Tumblr to Automattic Inc, the owner of publishing platform WordPress. The American telecommunications company had got Tumblr as part of its acquisition of Yahoo in 2017. Tumblr was bought by Yahoo for $1.1 billion in 2013. Now, Axios reports that the deal is valued at well below $20 million. One of the source has put the price for Tumblr below $10 million. The service is home to more than 450 million blogs and was one of the major players in the social media space.
However, Tumblr has lost its prime in the last few years and has faced a number of controversies as well. It has faced backlash over the years for not properly monitoring pornographic content on the platform. Verizon ultimately banned pornographic content on Tumblr last year. Matt Mullenweg, Chief Executive of Automattic told the Wall Street Journal that he plans to keep the ban in place. As part of the deal, Automattic Inc. will buy the network and absorb its 200 employees.
WordPress is the most popular publishing platform in the world and is used by more than 60 million websites. Around 33.6 percent of the top 10 million websites use WordPress as of April 2019. According to Crunchbase, Automattic has raised a total of $317.3 million in funding over 9 rounds. Its latest funding round was raised from Venture – Series on July 1, 2019. It is valued at over $1 billion and the acquisition gives it leverage in the content publishing business.
Verizon has been planning to sell Tumblr for sometime. As of May, Pornhub had been the only bidder to show its public interest. The turn of events with Automattic getting the platform is a surprise. It is not immediately clear how Automattic plans to integrate Tumblr into its ecosystem. It could leverage some of Tumblr’s strengths to make WordPress better. The platforms are likely to co-exist and may would call this a steal deal.