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From: Glenn Petersen7/2/2017 3:02:23 PM
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While this article focuses on the challenges faced by Tumblr, those challenges are also shared by Twitter.

But the truth is that running a platform for culture creation is, increasingly, a charity operation undertaken by larger companies. Servers are expensive, and advertisers would rather just throw money at Facebook than take a chance on your weird, problematic network. Generating and incubating internet culture has little market value in and of itself.

Tumblr’s Unclear Future Shows That There’s No Money in Internet Culture

By Brian Feldman
New York Magazine
June 28, 2017 4:48 pm



Earlier this month, Verizon completed its acquisition of Yahoo, incorporating the internet-portal pioneer’s slate of brands under a new umbrella corporation named, ominously, Oath. Among those Yahoo brands is the website Tumblr, a blog-based social network that you either know well to the point of obsession, or find completely incomprehensible. As Verizon completed its acquisition, a number of Tumblr employees, as well as those at other Verizon-owned properties, like the Huffington Post, were laid off.

The future of Tumblr is still an open question. The site is enormously popular among the coveted youth crowd — that’s partly why then-CEO Marissa Mayer paid $1 billion for the property in 2013 — but despite a user base near the size of Instagram’s, Tumblr never quite figured out how to make money at the level Facebook has led managers and shareholders to expect. For a long time, its founder and CEO David Karp was publicly against the idea of inserting ads into users’ timelines. (Other experiments in monetization, like premium options, never caught on: It’s tough to generate revenue when your most active user base is too young to have a steady income.) Even once the timeline became open to advertising, it was tough to find clients willing to brave the sometimes-porny waters of the Tumblr Dashboard. Since it joined Yahoo, the site has started displaying low-quality “chum”-style ads in between user posts on the Dashboard. Looked at from a bottom-line perspective, Tumblr is an also-ran like its parent company — a once-hot start-up that has eased into tech-industry irrelevance.

Looked at from another angle, however, Tumblr is among
the most important sites online — a central hub of what is nebulously known as “internet culture.” Most recently, the site gave us Dat Boi, the unicycling frog, but Tumblr’s most famous legacy is probably the reaction GIF, which was popularized by Tumblr accounts like What Should We Call Me. Tumblr’s reblog structure, which created lengthy, publicly shared conversations between strangers, also helped popularize the concept of the Discourse, the internetwide conversation happening all at once. It is also the primary meeting place for fandoms of shows like Doctor Who and Supernatural, and films like the Marvel movies — some of the most aggressive fandoms are cultivated on Tumblr.

It is rare, but not at all unprecedented, for a site to reach Tumblr’s size, prominence, and level of influence and still be unable to build a sustainable business. Twitter steers a huge portion of online culture, and has become an essential water cooler and newswire for journalists, tech workers, and otaku Nazis, but still has trouble turning a profit. Twitter itself shuttered its service Vine after just four years, even though the six-second-video social network had created more ubiquitous catchphrases and viral videos than any other social network over the same period. Reddit, the so-called “front page of the internet,” has been unable to fully capitalize on its enormous audience and influence, even after being purchased by Condé Nast (which it then spun out again; Condé Nast is very careful to specify that it does not own Reddit, though its parent company Advance Publications is a majority stakeholder). 4chan, whatever else you might think of it, is probably the most influential single website of the last decade, but its owner Hiroyuki Nishimura has said he is likely to shut it down. Even YouTube, which is synonymous with online video, still has trouble with profitability. As late as last October, CEO Susan Wojcicki was saying that the site was still in “investment mode” and that there was “no timetable” for profitability.

What makes these sites so friendly to creative expression? To begin with, there’s a focus on frictionless, near-immediate sharing — making posting hassle-free. 4chan doesn’t even require an account, whereas Vine limited its clips to a mere six seconds. It also has to be easy for users to iterate or remix content: The core function of Tumblr is the reblog, which lets users attach their own comments and photos to other posts like Lego blocks.

Importantly, iteration, and a meme’s growth, is much easier to track and understand when platforms use strict chronological timelines, which allow users to see a visible progression of online discourse, rather than trying to piece it together like a puzzle. Algorithmic timelines, like Facebook’s News Feed, are terrible for collaborative online culture. If Twitter has seemed a bit more staid over the last year, it might have something to do with its algorithmic timeline (which you can turn off).

Lastly, there is light content moderation. This can be a blessing and a curse, but allowing users to feel safe posting whatever is what allows these communities to grow, whether it’s via 4chan’s lolcats or Tumblr’s porn GIFs. When heavy-handed moderation is put in place, you not only limit expression, you run the risk of alienating the creators — like when top YouTubers like PewDiePie began to rebel against the platform after advertisers withdrew over content they found objectionable.

Advertisers, ultimately, are part of the problem. The general thinking in the rise of social networks was that if you make stuff that gets a lot of attention (or, better yet, own the real estate on which others are making stuff for free), brands will put their ads next to it. But with a small handful of exceptions, the advertising riches never really materialized. There are many reasons for this — for one thing, it’s tough to sell a high-quality ad experience to executives at Coca-Cola when you first have to explain what a meme is and why it’s “viral.” On top of all that, there are reams of porn, hate speech, copyright infringement, and more porn floating around on these platforms, easily accidentally placed adjacent to a company’s studiously inoffensive ad.

Maybe more importantly, Tumblr and Vine and the like never had data-mining operations as sophisticated as, say, Facebook. That’s why most of the advertising money in the industry has drained toward Facebook, which has 2 billion users, mounds of data, and can better assure advertisers of content cleanliness. Facebook is instructive: It’s less a place for creation or debate than it is for hosting all of the nitty-gritty, more boring data about your life. For much of its life, Facebook aggressively trafficked not in collecting rage comics and funny video clips, but in collecting bland lists of favorite movies and where you went to college — personal information that it can use to target ads with alarming specificity. And by selling ads against people’s identities, rather than their creative content, the company has churned out impressive profits, and given a wider impression that an ad-supported content platform is viable. (One of the great ironies of Twitter’s and Tumblr’s inability to make sustained profits is that Instagram and Facebook are both full of videos and posts screenshotted and stolen from their more productive, less wealthy rival platforms.)

But the truth is that running a platform for culture creation is, increasingly, a charity operation undertaken by larger companies. Servers are expensive, and advertisers would rather just throw money at Facebook than take a chance on your weird, problematic network. Generating and incubating internet culture has little market value in and of itself.

Which means Tumblr has to hope for patience and kindness from Verizon while it seeks a way to make money. It’s not an impossible task (though Verizon’s hope that Yahoo will be the content arm of a major advertising operation is not promising for the company). There are signs that the internet-culture machines are finding ways to make themselves sustainable: YouTube is not shutting down anytime soon, but pre-roll ads weren’t doing the job, and now it has a premium subscription service in order to collect revenue directly from users. The next hubs of internet culture will learn from the mistakes of the past decade, hopefully by doing one of two things: developing a way to collect revenue directly from its audience, like Twitch or Patreon allow now, or by eschewing the notion of a sustainable business at all. It can be easy, in the era of just a handful of megaplatforms, to forget that the internet used to be a much more decentralized place, where things went viral across disparate platforms and websites and forum threads, rather than within a single one.

All of this is running in parallel to a larger internet movement away from public spaces: group messaging, private forums, and chat rooms, ephemerality. The overall stumbles of building centralized hubs of internet culture mean that, going forward, content might soon be consumed not by one large audience on a single platform, but by thousands of smaller audiences across a variety of online spaces.

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