Verizon, the owner of the Tumblr blogging platform as well as of AOL, now says that its purchases of the two content providing platforms was basically useless.
But there seems to be more to the story. Apparently, Verizon purchased Tumblr and AOL to give itself the ability to produce content for the web. The two companies were then united under a Verizon subsidiary, Oath Inc. Industry analysts have suggested that the ban of erotic material reflected a plan on the part of Verizon to make Tumblr/AOL/Oath more appealing to conservative users and advertisers.
The marriage doesn’t seem to have been happy, though. Today (17 December), Verizon basically wrote off the whole Oath end of its business. CNN is reporting that “Verizon just admitted that the brand value of its media company, Oath, is almost nothing.” Further, says CNN, “Verizon (VZ) announced … it would take a $4.6 billion writedown on Oath, which includes Yahoo and AOL.”
Then, to add insult to injury, Verizon announced upcoming cuts in Oath’s workforce. According to NBC, Oath will lose roughly ten percent of its staff, or about 1000 employees.
None of this is good news for any of the companies involved–including the online magazine, HuffPost, which was purchased by AOL in 2011.
In short, the decision to ban adult content from Tumblr looks more and more like just the most recent of a series of disastrous decisions made by MBAs who were certain they knew how the content business worked…
…when in fact they were totally clueless.