Acquisitions

Was Posterous a ‘Consolation Prize’ When Twitter Really Wanted to Buy Tumblr?

davidnomnom2ms6 Was Posterous a Consolation Prize When Twitter Really Wanted to Buy Tumblr?

First Prize?

When the news broke this Monday that Twitter was acquiring Posterous, the reaction among the tech blogs was a rather muffled meh. Posterous, the microblogging platform that was pitted again Tumblr as soon as it game out of the gate, simply never got much traction. The platform’s founder, Garry Tan moved on to a more promising role as designer-in-residence and now venture partner at Y Combinator.

But what if Twitter had purchased Tumblr instead?

According to Gawker’s Ryan Tate, that’s exactly what Twitter was hoping for. His characterization of a partnership between two companies that hemorrhage cash? “The millenium’s worst merger,” beating out Time Warner-AOL’s “worst deal of the century.” As Mr. Tate writes:

It’s hard to imagine a pairing of two more overvalued and under-earning companies than Twitter and Tumblr, certainly not in the last 11 years. Aside from losing lots of money, both companies are bumbling about looking for a business strategy, more than five and four years from their founding, respectively. Nor would a combination harmonize the chaos, given the leadership differences; one company is run by a 25-year-old bon vivant car enthusiast on the east coast, the other by a former management consultant who convenes leadership classes and orders up lists of company “core values” out on the west coast.

Nonetheless, Twitter’s aim, said Mr. Tate, was to “add another channel into which Twitter could sell ads.”

As NBC reports, selling ads (something Tumblr won’t deign to do) is partly what Twitter wants to do with Posterous (well that and be all things to all people):

Why just be a part of the Internet, when you can try to mostly be it? Why be this machine for referring to Tumblr links, when Twitter users can start sending more traffic to Posterous links?

There’s also the matter of advertising. It’s no secret that Twitter is hard to monetize. Instead of crowding up the Twitter feed with ads, the company could offload advertisements to Posterous (or whatever new platform it becomes when Twitter’s wrapped its fingers around it).

Word of a Twitter-Tumblr partnership have been floating since January; Tumblr president John Maloney called it a “false rumor.” However, Mr. Tate’s sources seem to support what was out there: that Twitter was planning on offering equity to Tumblr, since the latest injection of cash valued Tumblr at $800 million despite “scant” and “mostly experimental” revenues, as the Wall Street Journal reported last August.

Instead, Twitter got Posterous, which raised 8 percent as much funding as Tumblr, but doesn’t offer (as-yet-unmonetized!) pageview riches.

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