Why Tumblr Must Kill What Made It Big: Porn and Copyright Violations

Last Updated Sep 12, 2011 7:03 PM EDT

Tumblr, which has suddenly become massive according to Nielsen, has a problem. In order to attract the advertising dollars it will need to make a profit, Tumblr must kill two aspects of its business that generate the majority of its content: Porn and photo copyright violations.

Tumblr had about 15 million unique visitors last month, according to Compete, and users spend 623 million minutes per month on Tumblr, more than Twitter and Linkedin (LNKD), according to Nielsen. The four-year-old blog host recently took in a round of $75 million to $100 million in new venture capital, which puts the fictitious "value" of the company at $800 million, according to the Wall Street Journal.

It has also experimented with advertising by offering sponsorships of its fashion blogs to New York Fashion Week advertisers.

Tumblr's dark side
But Tumblr's visual appeal has made it a haven for photoblogs, almost all of which rely on stealing the copyrighted works of others and publishing them without payment. If Tumblr and its bloggers begin earning revenue by running ads next to copyright-infringing images, lawyers will descend on Tumblr and its users like lions on an injured antelope.

Before that happens, advertisers will want to know if Tumblr can make itself safe for their brands. As a rule, mainstream brands decline to advertise on adult-entertainment content. Tumblr's problem is that it's the perfect vehicle for image porn: It displays lots of photos in large formats with few words and lots of tags and referrals for viewers who want more in the same vein. While mainstream advertisers with real money are sitting on the sidelines, porn bloggers are already earning money by referring traffic to adult businesses through referrals and widgets.

A majority of Tumblr searches are porn related, according to Web.App Storm. And "Tumblr Porn" searches on Google have risen in pretty much the same dramatic fashion as general interest in Tumblr has risen:


Tumblr will also have to grow up in terms of customer service. It currently does not offer enough dashboard analytics for its serious users to leverage it as a selling tool for clients. And although concentrating on selling sponsorships of fashion blogs is a good start, the company will have to become more realistic about pricing -- Tumblr recently attempted to charge $150,000 for a single banner ad on its fashion week site.

Related: Image by Skreened.

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