Illustration: Sarah Grillo/Axios

When Yahoo bought Tumblr in 2013 for $1.1 billion, its press release included a "promise not to screw it up." We could almost call that a tell, except it was really Yahoo asking if 4 in a row could count as a straight.

Why it matters: For Verizon, selling Tumblr was a fire sale for tax purposes. It also was another way to unload media assets that don't seem to interest Hans Vestberg, who became CEO after the Yahoo purchase. Yes, Yahoo screwed it up. But Verizon did no better.

Context:

  • Yahoo wrote down nearly half of that purchase price just 3 years later and then sold itself entirely to Verizon in mid-2017. In short, Yahoo never managed to leverage Tumblr's data in the way that Facebook did with Instagram ⁠— a pretty good comp given the timing, price and sector.
  • Verizon yesterday sold Tumblr to Automattic, the parent company of blogging platform WordPress. No financial terms were disclosed, but multiple sources tell Axios that the price was around $3 million. Or, put another way, well less than 1% of what Yahoo originally paid.
  • Automattic also will take on the entire Tumblr workforce, with a source saying that puts its post-close costs at around 20x the purchase price.
  • Tumblr still hosts around 450 million blogs.

What they're saying: We hear there were other bidders, although it's unclear if Pornhub was among them. The smut streamer had expressed interest back in May, after Verizon banned porn from Tumblr and put the business up for sale.

  • In terms of comps, the best I can come up with is Bebo, a social network AOL bought for $850 million in 2008, which it then sold 2 years later for just $10 million to a private equity firm (which later sold it to Bebo's founder for around $1 million).

For Automattic, which is viewed by Wall Street as an IPO candidate, it's about adding a consumer-facing business and large existing user base (or at least just Taylor Swift).

  • Axios' Sara Fischer notes that Autommatic rival Squarespace, which also wants to go public in the next year or two, has spent big money on consumer-facing marketing campaigns to beef up its numbers. Adding Tumblr helps Automattic keep pace there.

The bottom line: One of the fastest ways to lose $1 billion in value is to be sold for just over $1 billion.

Go deeper: An exclusive club of media unicorns survives media industry turmoil

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Illustration: Annelise Capossela/Axios

  1. Politics: Trump calls Fauci a "disaster" on campaign call.
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  3. States: California to independently review FDA-approved coronavirus vaccinesWisconsin judge reimposes capacity limit on indoor venues.
  4. Media: Trump attacks CNN as "dumb b---ards" for continuing to cover pandemic.
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USA Today breaks tradition by endorsing Joe Biden

Photo illustration: Aïda Amer/Axios. Photo: Win McNamee/Getty Images

USA Today, one of the largest newspapers by circulation in America, gave Joe Biden its first-ever presidential endorsement on Tuesday.

The big picture: A slew of media companies are endorsing a candidate this year for the first time ever, citing the unprecedented nature of this election.

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Illustration: Sarah Grillo/Axios

Many of the world's biggest tech and telecom companies, like Google, Amazon, Microsoft and AT&T, are licensing the Associated Press' election results to power their voice, video and search products, executives tell Axios.

How it works: Because tech firms need to answer millions of unique voice commands and search queries in real time, the results will be coded through an API — an interface that a computer program can read — designed to handle "not enough results in yet" and "too close to call" cases.