Some of the Services require payment of fees. Subscriber shall pay all applicable fees, as described on the Site in connection with such Services selected by Subscriber. Tumblr reserves the right to change its pricing and to institute new charges at any time, upon ten (10) days prior notice to Subscriber, which will be posted on the Site and e-mailed to Subscriber along with a link to the modified fee schedule so that you can review it. Use of the Services by Subscriber following such notification constitutes Subscriber's acceptance of any new or increased charges.
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Or, it could just be that they're making money by raising it from VCs.
Tumblr actually built out a feature set that was to be called "Tumblr Plus" ala Vimeo. This included group blogs and many other features that have since been released in the past year.
Ultimately, Tumblr's venture capitalists (including Fred Wilson) encouraged them to release those features as part of the free product and continue to focus on growth rather than monetization.
"Wilson added that 'some businesses should be allowed to scale and that takes capital — going for revenues and profits too early in some businesses is a mistake.'"
Some of the Services require payment of fees. Subscriber shall pay all applicable fees, as described on the Site in connection with such Services selected by Subscriber. Tumblr reserves the right to change its pricing and to institute new charges at any time, upon ten (10) days prior notice to Subscriber, which will be posted on the Site and e-mailed to Subscriber along with a link to the modified fee schedule so that you can review it. Use of the Services by Subscriber following such notification constitutes Subscriber's acceptance of any new or increased charges.
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Or, it could just be that they're making money by raising it from VCs.