Getty Images, Inc. has announced the acquisition of EyeWire, Inc., one of the largest
providers of royalty-free photography, video, audio, typefaces, software and other
design resources to creative professionals and business users.
Under the terms of the all-stock transaction, which closed August 5, 1999, EyeWire
shareholders will receive 1.85 million newly issued shares of Getty Images common stock
currently valued at about $33 million.
Getty CEO Jonathan Klein told Thom Calandra's Stockwatch that he was paying two times
what he expects will be more than $15 million of EyeWire revenue next year. He also
told CNET that EyeWire generated $12 million in sales last year.
EyeWire had its origins in 1985 as the industry's first distributor of individual
digital typefaces on CD-ROM. The company was purchased by Adobe Systems Incorporated in
1994 and operated as Adobe's visual content division. In September 1998 it was
purchased by the division's management team and at that time EyeWire president Brad
Zumwalt said, "The company has a growth rate of 50% per year and revenue exceeding $20
million annually." (See story 196.)
At that point EyeWire repositioned itself as an Internet-focused business and moved to
launch a portal site serving the graphic design community. It is interesting that
eleven months after taking this new direction current revenue on an annual basis has
fallen from "in excess of $20 million" to somewhere between $12 and $15 million. EyeWire
says the Adobe revenue included portions of business they did not carry on with once
they became independent.
EyeWire's distributes a monthly catalog to approximately 700,000 business users in the
visual content industry. In addition to marketing their own wholly owned content they
have become a leading distributor of third-party products, through agreements with some
of the industry's top vendors such as Adobe Systems, for design applications; AutoFX,
for image manipulation tools and typefaces from industry leaders such as International
Typeface Corporation (ITC), FontHaus, and Elsner & Flake.
Expect to see EyeWire drop its efforts to launch a Rights Protected division of their
operation as was announced in June (See story 229).
Charles Mauzy will remain with the company and work on other projects.
Key Benefits For Getty
The acquisition marks the first time new product categories beyond still and
moving imagery have been added to Getty Images' product offering. These new product
lines extend Getty Images' collection beyond still photography and moving imagery,
adding royalty-free audio, video, illustration, clip art, over 800 typefaces, and a
variety of design applications.
EyeWire has one of the industry's largest and most comprehensive customer
databases of design professionals worldwide.
Eyewire's strong relationships with the emerging business-user market is expected to
help build the foundation for the Business User division of Getty Images.
EyeWire's strong relationships with non-photographic content providers will add
tremendous value to Getty's hub websites.
Removing a potential competitor for "portal dominance" from the field.