What Flickr Might Have Been and How Yahoo Is Slowly Burying It

The photo-sharing site Flickr may be following a path eerily similar to its troubled parent Yahoo!

In December, Flickr’s unique U.S. visitor traffic dropped 16 percent, to 21.3 million, compared to a year ago, according to the New York Times. In contrast, Facebook’s photo-sharing capabilities saw a 92 percent increase for the same time period.

Flickr resembles several other Yahoo! properties that have either underperformed or missed market opportunities. In Flickr’s case, the story is particularly bittersweet. As the Times states, Flickr was “a pioneer in combining photos with social networking features.” But now it faces a double-edged sword—competition from the social networking tsunami called Facebook, along with the rise of other newer photo-sharing services, particularly in the mobile space.

Jordan Rohan, an analyst with Stifel, Nicolaus & Company, puts the Facebook phenomenon in perspective. He tells the New York Times:

“The Internet is starting to rotate around the axis of Facebook—not everything, but everything social. Yahoo! and Flickr don’t really have the gravitational pull that would make Flickr the axis that they once imagined.”

As the de facto standard for sharing, Facebook makes it just as easy to share photos as text. Admittedly Facebook’s photo service is more about quantity than about quality, which is Flickr’s strong suit. But last fall, Facebook was testing images with a higher resolution, as well as a new photo viewer and the ability to tag photos in bulk, according to the Times.

Where Flickr may have focused on providing a quality service to serious photographers, thus limiting its market, Facebook made photo-sharing a natural part of its offering for all users. In the mean time, YouTube dominated the video market, marginalizing Flickr even further.

One of Flickr’s key failures may have been the fact that it missed the mobile market. Take a start-up like Instagram, which signed up 1.75 million users in just four months. The service is specifically intended for use with the iPhone. Users can take pictures with their iPhone, add visual effects, share them, and comment on other users’ photos. Instagram just announced its first major round of funding—$7 million.

“The really sad thing for Yahoo about the popularity of Instagram,” writes Nicholas Carlson for Business Insider, “…is that the people who use the Instagram app seem to be very similar to the type of people who currently use Flickr.”

Stewart Butterfield, who founded Flickr with his wife in 2004 and sold it a year later to Yahoo!, sounded downright melancholic when he told the Times, “We just missed some opportunities that we could have tried if we were independent and raised our own money. Who knows what would have happened?” He added, “There’s not another 100 million people who would use Flickr and be happy with it without a fundamental change to what it is and what it does.”

As if to add an exclamation point to Butterfield’s criticism, a story surfaced on February 1 in which a photographer said that Flickr had mistakenly deleted his account’s 4,000 pictures. Talk about adding insult to injury.

While Yahoo! publicly denies any plans to shut down or sell off Flickr, Flickr’s fate may in fact be linked to Yahoo!’s fundamental problems. This is just one more piece of evidence that the early market leader who doesn’t stay current will not remain a leader for long.

About Barry Silverstein

Barry Silverstein is a freelance writer/marketing consultant. In addition to writing for ReveNews, he is a contributing writer to Brandchannel.com, the world’s leading online branding forum. He is the author of three marketing books, The Breakaway Brand (co-author, McGraw-Hill, 2005), Business-to-Business Internet Marketing (Maximum Press, 2003) and Internet Marketing for Technology Companies (Maximum Press, 2003). Barry ran his own Internet and direct marketing agency for twenty years. You can find Barry on Twitter @bdsilv.

2 Responses to What Flickr Might Have Been and How Yahoo Is Slowly Burying It

  1. TrishaLyn says:

    This makes me sad to consider that Flickr may be failing, as I love the service. I love the pro features and gallery features that Facebook doesn't have.

  2. Pat Grady says:

    if a picture falls in a forest…