John Battelle's Searchblog

Will Flickr survive the Yahoo mega-monster? Yahoo has so many other services that Flickr will probably be buried between the Yellow Pages and the People Search.

I think that this is the best move, for both companies. The viability of Flickr as a potential independent, TSX-traded company would seriously be questioned as I don't believe the social networking and photo sharing phenomenon can ever achieve sustained profitability and revenue growth like major e-commerce and Internet services businesses like Yahoo! and Google can. So, I'm glad Flickr, or its privately-held Vancouver, BC-based owner Ludicorp Research and Development Ltd., decided not to go the initial public offering route.

It's with a little bit of patriotic sadness at the loss of an Canadian Internet "star" that is wholly founded by Canadians and continued to be based in my home province of British Columbia. Nonetheless, being part of Yahoo! will allow it to grow without being pressured to ever produce profits or growing sales by its shareholders as Yahoo! will simply be happy with the massively loyal and dedicated Flickr users it attracts, to which Yahoo! can passively push paid, subscription-based Yahoo! Network services.

It's also interesting to note that Ludicorp was one of the first companies to receive start-up financing from the B.C. government's small business and venture capital fund. Cool.

As far as going to Yahoo!, it's better for another reason: Yahoo! has one of the best records of acquisitions. Not only does it consolidate all of its acquired companies domain names and other assets into a single portfolio, it lets them operate better under their own brand within the multi-faceted Yahoo! Network and branding.

So it's good all around. I was definitely glad to see Yahoo! snap it up before Google could.

Cheers,
Doug