Why do they want to know that?
As I am using Yahoo!* weather, I started asking myself, why would that be one of their first mobile apps.
I mean, look, you'd be hard pressed to put an ad right into the weather app (though you could). You're not going to charge for it - too many free competitors. You're not driving traffic back to other places that are generating ad revenue (though they are trying that in a mobile sort of way.)
Looks good
Then, why weather? Well, it got me to thinking about checking the weather. First, it tells Yahoo! where I live. (If I'm responsible, I'm probably checking before I get myself or my kids dressed, so it's telling them what my normal routine is.) If I work in a different city (especially in micro-climate heaven Northern California), I'm probably checking the weather there too. If I'm going on vacation (or thinking about going somewhere), I'm checking the weather there.
So, without thinking about it, I'm telling Yahoo! a lot about myself with this app. That gives them a lot of information by which they can target stories or ads at me. I like the app, so I'm willing to make the trade. But I'm making the trade consciously. Now, at least.
If they can get all this from a weather app does Yahoo! shelling out $1.1B for Tumblr make more sense?
* Full disclosure, I used to work at Yahoo!
Good info
And an attempt at recirculation.