Yahoo - Rough and Tumblr

It is not hard to see why Tumblr has attracted the internet giant's attention. The business, which was launched in 2007, is hugely popular and many of the service’s users are young folk who like to share everything from their latest fashion tips to pictures of cats with their heads encased in bread (yes, really).

Critics have been quick to point out that advertisers are unlikely to want their ads to appear alongside some of Tumblr’s content, notably numerous blogs that feature pornographic content. They have also been pointing out that a big part of Tumblr’s appeal is that its bosses have not let the service become overrun with advertising. If Yahoo starts to pump in huge numbers of ads, people may abandon the service in droves.

True, but if Yahoo manages the acquisition carefully it could turn out to be a smart move. Plenty of folk predicted a mass exodus from Instagram, a photo-sharing service, after Facebook snapped it up for $1 billion last year. But the social network has managed to develop the service without making users head for the exit. If Yahoo can pull off a similar feat with Tumblr, then it will certainly appear cooler to its shareholders.