according to Leaked memo, Tumblr’s long-term financial problems have reached a breaking point. Aside from a core staff of essential workers in departments like trust and safety, the majority of Tumblr’s 139 workers will be reassigned to other products at parent company Automattic, which employs about 1,900 people. CEO Matt Mullenweg acknowledged the memo on his Tumblr blog, where he was responding to questions from site users.
In response to a question about whether or not Tumblr will be shut down, Mullenweg wrote:
“What’s very clear is that our previous approach wasn’t working. The business didn’t improve to make enough money to support the investment in infrastructure and staff needed to run Tumblr, and a lot of users were unhappy with some of the changes we tried. There were some changes in staff Working within the team, but basically what we’re saying is that starting January 1, 2024, we’re going to try a different structure with smaller, more focused teams working on the core parts of Tumblr that people say they want to improve. We’re going to cancel or roll back some of the things we tried that didn’t work.
Tumblr’s problems are no surprise. The blogging platform saw a brief resurgence in popularity, as disaffected Twitter users searched for a new home in the wake of its acquisition by Elon Musk. But Mullenweg revealed last July that Tumblr loses about $30 million annually.
Tumblr faces the same challenges as any social platform, but it has the unique tension of catering to a fiercely protective fan base who rebuffs most attempts at monetization. Tumblr users will pay to submit crab to their friends, or to buy blue checks as a prank to mock Twitter, but when the site tried to launch the subscription feature, it went as bad as a product launch can.
Founded in 2007, Tumblr was acquired by Yahoo (parent company of TechCrunch) for $1 billion in 2013. By 2019, Automattic, the parent company of WordPress.com, bought Tumblr for just $3 million. Although it has a loyal base of power users and is beloved in fandom spaces, Tumblr also has Resist To grow the number of daily active users, especially after the notorious porn ban.
This story develops…