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Time to upgrade this from rumor to unannounced fact — that's our bet, anyway. "Consolidation" was the word seized upon most in Yahoo exec Brad Garlinghouse's "Peanut Butter Manifesto." And consolidating the duplicate services provided by post-acquisition Flickr and Yahoo Photos makes sense. Flickr founder Stewart Butterfield denied there would be any merging, but that doesn't rule out "consolidation" by way of elimination. For the whys and wherefores, read on.When we predicted that competing products like Flickr and Yahoo Photos would be consolidated, Butterfield reassured nervous Flickr fans:

I betcha Flickr keeps going more or less on the same path (always evolving, sure, but more or less the same) for a long, long time to come.

He went on to call us out specifically:

It's interesting to hear all the different perspectives on this. ... Very different from the inside, but it's mostly stuff I can't talk about. However, I can say that I'm really, really happy about all the recent changes. Valleywag has a lot wrong (just factually wrong, but it shows up in their interpretations) so I wouldn't put a lot of stock in it. All good! And in particular, all good for Flickr and it's future :)

M'kay, but what's good for Flickr ain't so good for Yahoo Photos. It's an unfortunate situation, as Yahoo Photos has actually been doing well lately. However, it can't compete with Flickr's brand and fanatically loyal following, and there really is no reason for Yahoo to maintain two flavors of the same service.

As Jason Kottke pointed out recently, Flickr is under assault from Fotolog, which while much less popular Stateside, is eating Flickr's lunch internationally (particularly in South America). Arguments about relative quality of product aside, this should be worrisome for both of Yahoo's photo teams. Secondly, while Butterfield calms the Flickr faithful, his fellow Flickr co-founder Caterina Fake now leads Brickhouse — Yahoo's in-house idea creche that just launched Yahoo Pipes. With Butterfield and Fake both holding power cards, what challenge could Yahoo Photos realistically mount to stay viable?

Flickr may indeed stay on the same evolutionary path, but Yahoo Photos will almost certainly disappear in the very short term, with its users and content migrated to Flickr gently but forcibly. Flickr itself may well "evolve" some of Yahoo Photos' monetization strategies ... perhaps Flickr will inherent the "Prints and Gifts" section from Yahoo Photos once the just-launched Flickr print service gets off the ground. Either way, Yahoo Photos will be consolidated right out the door, and sooner rather than later.