Posted March 18, 2011 7:34 am by with 1 comment

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The Silicon Alley Insider is reporting that Yahoo is getting ready to sell its Delicious service for what seems like a mere pittance and that the buyer would be a strategic partner, possibly StumbleUpon.

SAI reports

Yahoo is about to close a deal to sell bookmarking site Delicious for $1-$2 million, says a source familiar with the discussions.

Our source isn’t sure what company is buying it, but says it’s a “strategic partner,” something like StumbleUpon. StumbleUpon just raised a fresh $17 million round, so it could easily afford Delicious. We called StumbleUpon for comment and haven’t heard back.

So why such a small price for such a well known and respected brand? It’s pretty simple. It doesn’t make any money. There is virtually no monetization. So it appears that even in this age of skyrocketing valuations that make some folks scratch their heads common sense can prevail. If something isn’t making money then it isn’t worth much.

So what is to become of Yahoo? Selling Delicious has to be somewhat painful because it is one of the most widely used Yahoo properties. And it’s only being sold at the price level of an appetizer on any VC’s menu. Not good. Not good at all.

There has been little talk of Yahoo these days and that doesn’t bode well. Each passing day that Google and other Internet players make more waves but Yahoo is left out of the equation it runs the risk of being pushed to the back burner like MySpace was. That’s not a good thing especially when stockholders would get slammed.

So is this Delicious fire sale a sign of what else to expect from Yahoo? Will they be able to play the content game and win? Are they going to innovate to attract new visitors or are they going to try to hold on their existing base and hope there’s enough there to be relevant? Add on top of all of this the latest exit of talent as the head of product at Flickr, Matthew Rothenberg announced his exit yesterday and there has to be real concern that Yahoo is in serious trouble.

What’s your take on Yahoo these days? Is there hope or are they becoming a non-issue as a brand and a company?

  • This is why we founded – Yahoo seemed to abandon Delicious years ago and hasnt added new features in a long time.

    It’s very sad – Delicious used to be the leader in social bookmarking…