Techcrunch and Valleywag report that Yahoo! has agreed to acquire MyBlogLog for an estimated $10 million.
That takes the number of Yahoo acquisitions we’ve heard of in the last 24 hours to 3 – Loren talked about Yahoo acquiring Bix earlier, while Katie Fehrenbacher from GigaOM also reports that Yahoo! has confirmed its acquisition of Swedish mobile company Kenet Works. The deal was concluded a few months ago and is reported to be at least $21 million (according to Swedish newspaper Dagens Industri).
Where does this lead Yahoo? While Google has established a clear lead in search engine market share, Yahoo still holds its own where social media is concerned and their traditional focus has always been on community building tools.
I think people have it wrong. The reason Yahoo picks up all the cool social media startups is NOT that Yahoo ‘gets’ social media better than Google (they might, but that’s not the reason they’re buying these companies) – it’s because they’ve effectively lost the battle in search, and are working hard on beefing up in the one area where they might stand a chance – social media.
Coming back to MyBlogLog, it looks like a very smart piece of business by Yahoo. I’m sure plenty of people are going to come out and point at the hammering Yahoo’s received in the stock market, at the lack of a lucrative business model in MBL, etc etc. But at the end of the day, MyBlogLog has all the features Yahoo’s gunning for in the social media wars – strong community base, a geeky coolness, plus a kickass product.
I remember when I first came across MyBlogLog – Aaron Wall was trialing it on his blog and I mailed him asking about this ‘cool javascript mouseover thing’ he had on his site. Doesn’t seem too long ago, but here we are today and MyBlogLog’s fetching $10 mil. Good business for Scott Rafer, and good business for Yahoo too methinks.
MyBlogLog may stagnate, or it may keep booming. But what will be most important is how Yahoo leverages the community, and dealing with communities is Yahoo’s bread and butter.
Ahmed Bilal is a business consultant – you can reach him through his blog.
