Six Apart has sold its hosting blogging platform LiveJournal, which it acquired in January 2005, to Moscow-headquarted SUP (pronounced “soup”), the company said this evening. Terms of the deal were not disclosed. SUP previously acquired licensing rights in October 2006 permitting them to manage LiveJournal in Russia, where the platform dominates blogging culture.
“This allows Six Apart to focus on their remaining three brands (Vox, TypePad and MoveableType)” CEO Chris Alden told me this evening. LiveJournal, created by Brad Fitzpatrick in 1999, was the lone service not built in house. “We have very ambitious plans for our remaining brands going forward” he added.
Since the 2005 acquisition, Live Journal has grown from 5 million to over 14 million accounts. But overall unique visitor and page view growth has been static for the last year. In October 2007 Comscore says LiveJournal had 13.8 million worldwide unique visitors generating 475 million page views. That’s up only slightly from the 11.1 million visitors and and 408 million page view per month a year ago.
How much was it sold for?
I am aware that live journal is still very popular. It was one of the first services to give people their own subdomain for a blog.
Looks like typepad.com is down. I am getting a 502 Proxy Error. Anyone else having a problem?
The proxy server received an invalid response from an upstream server.
The proxy server could not handle the request GET /.
Reason: Error reading from remote server
Russia.. impressive! Congratulations!! /ac.
LiveJournal was effectively the MySpace / FaceBook of its day in terms of its success as a social networking site. It’s certainly the site I remember a lot of people signing up to and connecting through about four years ago. With that in mind, this sale is a little sad, although perhaps the new owners will infuse it with some energy. There’s no denying Brad Fitzpatrick is a true Internet hero though.
As a Typepad user for over a year and a half, I’m glad the service is being sold, if it means Sixapart will spend more time on their Typepad product.
They announced paginated main page archives in mid-October, but here I am, beginning of December, with no paginated archives. Explain to me how you can run a serious blog where readers have no idea what to do after scrolling down your newest 10 articles. Love the company, but would like the service to be comparable in terms of features, when compared to other blog platforms.
Michael, thanks for mentioning the story — it’s going to be an exciting time both for Six Apart and for LJ.
Carnet, we’re not seeing that error — feel free to email me personally (anil@sixapart.com) if I can help you troubleshoot access to TypePad.
And Preston, we hear you loud and clear. We’re investing a tremendous amount of resources into TypePad (check out Everything TypePad today for info on just some of the positions we’re hiring for), and we definitely intend for TypePad to be the leader every feature that’s out there. Feel free to contact me or our support team if there are specific things we can be doing better for you.
Poor guys
there was a very big scandal in Russia when one of SUP guys accessed private information of ljplus.ru user (ljplus.ru is a service associated with livejournal and supported by SUP) using his administrative rights.
I expect that the same may happen with livejournal users. SUP did nothing to prevent such accidents in future.
Hope California laws will protect livejournal users from Russian team.
This might be interesting to everyone:
http://siteanal....com/?metric=uv
LiveJournal is a lot bigger than Vox, and a lot smaller than Typepad, Compete says.
Smart move by 6A, congratulations! LJ has to be albatross-like, it’s so primitive.
Russians, they’d better be careful! I know what I’m talking about.
Das ve danya
http://fakestev...er.blogspot.com
Jeeze, i didn’t realize they grew LJ so nicely over there. Makes Fitzpatrick’s dropping the ball even more pronounced
hey Michael, a typo, it is Movable type not moveable type.
other than that, congrats to my former company Six Apart and to sup, sounds like a good deal for both.
Hey Loic, a typo, it’s SUP (all CAPS) not sup.
/just say’n
Same difference.. /ac.
Livejournal has gotten increasingly draconian with their users, sometimes deleting permanent accounts with little to no actual explanation. People may not think this is a big deal, but it does discourage people from endorsing the site to friends/family.
even i m a user of LJ, i disliked it.the basic user interface was too poor.
That’s the best buyer it could find?
Friend studying the case studies of business sold and acquired I never understood the core focus vs. diversified business thesis. Hedging risk is better or going for focus.
Whats Ur take friend.
http://tekno-wo...ld.blogspot.com
Well I’m actually kind of confused with this deal.We know change can be scary, even if it’s a good change.Russian company buying LJ, given Russian servers’ problems with viruses and the like.
If i can recollect there were a lot of embedded viruses in there, so it that LJ is going to get migrated to Russian servers. Silly must say !
Well Anyways ALA SUP’s get their priorities straight: their number one goal is to make sure all of you who are current LiveJournal users are happy, and to make LiveJournal better than ever before.
Parul
http://www.bhopu.com
Paid LJ users might want to keep a close eye on those credit cards on LJ’s servers once the Russian team gets their hands on them.
What’s the deal size? Are we talking about $200M? That’s the valuation that had been floated at some point.
When SUP first partnered with LJ, they negotiated something around 20 mln to be invested to enhance marketing across the russian LJ-communities.
If you’ll trace thoroughly to where the money flow, you’ll learn, that a guy Andrew Paulson has been working for SUP for quite some time. He came there from Afisha – an entertainment press and web publisher, arguably largest provider of theatrical, cinematic etc. entertainment info in Russia. Afisha was bought by PROF-Media publishing house, currently owned by one of the Top-5 Russian oligarchs – Vladimir POTANIN. Potanin’s primary assets are Kombinat Noriliskiy Nikel (largest base metal producer in russia), gold production facilities and large-scale industrial production (tubes, machinery etc.).
PROF-Media is actively expanding in it’s internet division (some time ago, it bought a decadent russian search engine – Rambler). It’s not known for sure, but very likely that SUP is also under the influence of Potanin’s money.
Potanin is politically neutral, but is generally supportive of Russian current political balance. So if my logic is true, some political censoring might be expected…
By the way, my second guess, which my be even better, is Leonid MELAMED. A former top-manager of Russian energy monopolist RAO-EAS, now a book and internet tycoon. There were talks, that he, among other powerful people is behind SUP Fabrik.
I doubt they got $200 million. It’ll be interesting to see if the valuation leaks out, but given that it was announced quietly on a Sunday and has a feeling of unloading an albatross from their neck to focus on their core competencies, I wouldn’t be surprised if they got little more than what they paid for it with a slight premium.
They paid roughly $5 million nearly three years ago. My guess is they got maybe $7.5 to $10 million for LiveJournal? Remember, valuations are going down, especially for stagnant and falling properties. IAC/InterActiveCorp recently shed Excite Europe for half what it paid for it ($6 million versus $10-12 million a few years ago) to GoAdvertising Ltd., a European new media advertising company.
What do you guys think?
Cheers,
Doug
Here in Russia one of the most reliable newspapers tells today it is only $30 million. Actually I would not tell it is a definitive price since it is not from the SUP SEO (he refused to disclose the amount when talking to the journalist from the newspaper) – instead they quote some “source close to the deal makers”. Poor price in my opinion – gives the impression that SixApart wanted to get rid of LJ very much.
Russia’s Interfax news agency is reporting the price tag as roughly $30 million, could be slightly more or slightly less and likely all in cash.
http://www.inte..._issue=11921892
So, it appears my guess was a lot closer. They wanted rid of LiveJournal and managed to make a healthy return on their nearly three-year-old holding. It’s a good move – I just hope the U.S. site remains hosted in North America.
Cheers,
Doug
The $30 M number comes from a publication affiliated with the new owners so I feel $7,5M might be a more realistic guess.
Whatever the price is: $7.5 or $30M, don’t forget it is inflated by mandatory kickback – the money ultimately come from Russian government and not from private investors, so the size of the deal has nothing to do with market value.
I’d expect the price around 5-10M dollars
Russian companies sell&buy one user for 5-10 dollars (considering last “runet” merge and sales) so I would expect say 7 dollars for each one of 1.5 mln Russian users
Stan: I understand the reasons for your assumption but so far all interest has been purely commercial.
Good to see things moving out of US. With falling dollar and geo-political unrest created by the US, we can see more of this in future. Next: TechCrunch acquired by somebody in Vietnam
Kashif: if US dollar falls relative to your home currency, this makes US more competitive against your country, not less. Time to move back to Bay Area.
Interesting strategic move given the traffic and the brand name. I wonder what this means strategically. Does TypePad need the cash?
Michael – where is your analysis on this? It seems you just cut and pasted the SA press release.
My analysis: LJ was a distraction for SA. This should allow SA to concentrate on it’s core products.
MT – DIY and Enterprises
TP – bloggers, ads and professional
Vox – social and personal
I guess Putin has the root password now for the LiveJournal servers.
Russian businesses are not to be trusted, especially when the executives have tattoos!
http://fakestev...er.blogspot.com
i have yet to see someone do a more in-depth piece reviewing SixApart business strategy (or lack thereof) & fundamentals… seems like someone could put a really interesting story together on this.
sarah lacey’s article over on BusinessWeek is a nice opinion fluff piece, but there’s got to be someone willing to do the hard digging to put together real #’s on the LJ sale, the 3 remaining properties, and 6A’s overall prospects for acquisition vs IPO vs further investment.
the company is perhaps 2nd only to Yahoo in terms of potential opportunity yet-to-be-realized… what the hell is going on over there? why hasn’t a deal happened? are they profitable or not? are they an acquisition target or not? has the CEO turnover resulted in material change in strategy?
if anyone’s seen a more in-depth article on 6A, please provide link.
Dave – they do seem very reclusive!
What really amazes me is the number of commenters who seem to think this is a good thing.
SixApart knew full well of the opposition in the Russian-speaking segment of their customer base to SUP. There was a wave of indignation and opt-outs when they allowed SUP to do part of the support. Despite this knowledge they basically sold their customers down the river.
VERY, VERY SAD!
There were parliamentary “elections” in Russia yesterday and there was a blog, which was fallowing all the law violations (which were infinite) and was anti-Putin.
If the rumors (government backed buying) are true, and I thing they are, this is Russia buying logs for every user LiveJournal ever had. Very, very sad.
I found the buying at Sunday when the elections just ended to be very interesting.
And when I say there were “elections”, I mean:
1. 99,9% in the state of Chukotka voted pro Putin ?!?!?!?!?!?
2. There were opposition leaders in the arrests!
3. No free press, government supported EVERYWHERE in media, and the only place left is Internet.
Living in Eastern Europe and lived during communism, I can tell something is coming from Russia … and you won’t like it.
I forgot, the blog was at Livejournal:
http://communit...om/vibory_light
The freest political forum in Russia is a hot potato to more than just the Russian elite it seems.
Is there any other free blog providers in Russia? I know mail.ru has simple blog feature. Haven’t seen any proper russian blog services.
Did anyone hear that LiveJournal tried to acquire Amateurmatch but they declined? I mean I havent heard anything about that for Amateurmatch
An interesting video report on this issue!
http://www.yout...h?v=h7gfyE1Taa4
YouTube
Not sure about importancy of LJ for russian speaking community now but a couple of years ago it was growing very fast. I think now a huge part of russian speaking LJ users and newcoming internet users rushing to use a brand new services on russian internet scene such as vkontakte.ru (facebook clone) and odnoklassniki.ru.
Hi! cipro hc ortic