Getty Images has watched the rise of
Shutterstock – to the company’s chagrin – and is trying to build
Thinkstock to a position where it can take market share away from Shutterstock.
Getty acquired Thinkstock as part of its 2009 purchase of
Jupiterimages. Since then both Thinkstock and Jupiterimages have been operated as separate brands. Some of the brands acquired in the Jupiter deal, like Comstock and BrandX, are also available as separate brands on GettyImages.com.
According to sources, in an effort to upgrade the quality of the Thinkstock offering Getty has put 3 million of the images from various brands that were originally part of the Jupiter purchase onto Thinkstock. These images can now be found on both sites at different price points on each site. Among the Jupiter brands now on Thinkstock are: Creatas, Bananastock, Able Stock, Hemera, Goodshoot, Photos.com, Liquidlibrary, PhotoObjects. When customers go to Jupiterimages.com it says there are 2.5 million images on the site which would indicate that 100% of the images there can now also be found at Thinkstock at much lower prices.
Getty has also placed 1 million of the Royalty Free images that can be found on Gettyimages.com on Thinkstock. This means that almost 30% of the Royalty Free images on Gettyimages.com are now also available on Thinkstock as well, at much lower prices. Among the brands are: Blend, Image Source, Lifesize, Digital Vision, Photodisc, MonkeyBusiness, Stockbyte, DesignPics, Blue Jean, Fuse, MIXA, Wavebreak Media, Purestock, Ingram Publishing, Huntstock, Dorling Kindersley, BlueMoon Stock, TongRo Images, F1Online, EyeCandy, FogStock, Zoonar and Stocktrek. It is unclear whether all the images of these brands can be found on both sites, or whether Getty has done some type of editing and only selected some of the images from each collection to be placed on Thinkstock.
In addition, Getty claims they have put 6 million of the images from
iStockphoto on Thinkstock. We believe most of these images are from the collections of non-exclusive iStock contributors. The non-exclusive contributors are required to allow Getty to sell their images through Thinkstock if they want the images to remain on iStock. Based on comments found on various blogs we believe very few of the exclusive contributors have allowed their images to be placed on Thinkstock because they generally think it is a bad deal. Exclusive contributors have been given the option of having their images on Thinkstock, or not.
Pricing
The pricing for Shutterstock and Thinkstock breaks down as follows:
| |
Shutterstock |
Thinkstock |
| Subscriptions |
|
|
| 25 per day |
|
|
| 1 month |
$249 |
$299 |
| 3 month |
$229 |
|
| 1 year |
$199 |
$208 |
| |
|
|
| 50 per month |
|
$139 |
| |
|
|
| Image Packs |
|
|
| 2 image |
$29 |
|
| 5 image |
$49 |
$49 |
| 25 images |
$229 |
$229 |
| 100 images |
|
$799 |
| 250 images |
|
$1,499 |
Thus, with a 25-image pack the cost per image is $9.16; with 100 image pack the cost is $7.99 and with a 250 image pack the cost is $5.99.
The Image Packs are a tremendous bargain, more with Thinkstock than Shutterstock. Thinkstock offers large packs at deep discounts compared to Shutterstock. All a customer needs to do is make an estimate of the number of images they will need to purchase in the next 12 months. The customer will want to try to purchase a pack that offers less than they actually expect to need so they are sure to use all the images allowed. If they run out before the year is up they simply purchase another pack and start a whole new year. The only problem customers have when purchasing images from Thinkstock rather than Gettyimages.com is that they can’t print more than 500,000 copies of an image in any given product without buying an extended license at an additional expense. If the customer is going to use a lot more than 250 images in six months or so it will probably make a lot more sense to purchase a subscription, but very few customers will fall into that category.
If the customer finds an image from one of the brands listed above on Gettyimages.com there are four different price levels depending on the brand. They are:
| Smallest |
Largest |
| File Size |
File Size |
| $10 |
$361 |
| $15 |
$412 |
| $21 |
$567 |
| $26 |
$618 |
The prices on Jupiterimages are a little less than on Gettyimages.com, but more of less in the same ballpark. On iStockphoto the price for the smallest file size of a non-exclusive image is a little less than on Thinkstock. But, the larger file sizes needed for most print uses will be much more expensive in most cases (See
chart).
The big advantage Thinkstock offers compared to purchasing the image on Gettyimage.com, Jupiterimage.com or iStockphoto.com is that customers get a full 50mb file of any image they download rather than having to pay more for larger files sizes.
Assume that the image is available on both Gettyimages.com and Thinkstock.com. If the customer plans to use the image on the web and all they need is the smallest file size then purchasing the image from Getty won’t be that much more expensive than getting it from Thinkstock. But, if the customer needs a large file for print use there is a huge advantage in checking Thinkstock to determine if the image is available there for $9.16 or less rather than paying $400 to $600 to use a single image.
Getty has made it very easy for its customers to check Thinkstock to see if they can purchase the image for less money.
Thinkstock has added a new feature called “Search by Image.” If a Getty, Jupiter or iStock customer finds an image they want to use on one of these sites the first thing they need to do is right-click on a thumbnail of the image and save it to their desktop. Then they open Thinkstock.com, click on “Search by Image” and drag the image from the desktop into the search box. They will be told immediately if the image is available on Thinkstock. In about 30% of the cases they will find the image on Thinkstock at a much cheaper price than they would have on any of the other sites.
Getty needs to hope that its regular Gettyimages.com customers, or those using Jupiterimages.com or iStockphoto.com, don’t learn about the Thinkstock option. If they do Getty’s gross revenue will certainly decline.
Image Quality
Getty is hoping that by adding higher quality images to Thinkstock customers will be drawn away from Shutterstock. If customers take the time to compare the two sites side by side they may conclude that in many cases Thinkstock offers images of higher quality than Shutterstock. But, Shutterstock has plenty of images of sufficient quality to meet the needs of most customer. If a customer is currently happy with what they get from Shutterstock, I doubt they will find sufficient reason to switch.
Marketing Problem
Getty also has a major marketing problem. I suspect that right now relatively few of Getty’s 1 million customers know that Thinkstock exists. Getty will have to be careful about promoting Thinkstock to its existing customers for fear they will buy most of the images they need from Thinkstock rather than Gettyimages, Jupiterimage and iStockphoto. If that happens we’ll see a dramatic reduction in Getty’s gross revenue unless those customers buy a huge number of additional images. But customers don’t use more images just because they are cheaper. Most customers have relatively fixed requirements for images year after year.
The only way this strategy can work to Getty’s advantage is if they can attract a whole lot of new customers. That means they must take customers away from Shutterstock, as well as make Thinkstock the go to site for the majority of new customers coming into the market. As I have already pointed out, I don’t think they are going to pull that many customers away from Shutterstock unless Shutterstock makes some major strategic error.
It appears that Getty’s hope is that they will be able draw a major portion of all the new customers coming into the market to Thinkstock. The problem with this strategy, I believe, is that there are relatively few new customers coming into the market.
It is interesting to note that Getty was claiming they had 1 million customers back in the early 2000s -- and that’s the number they are still using today. Certainly some customers have retired or gone out of business. New people replace them. But by and large there has not been huge growth. Given the huge difference in price Getty must insure that all its current customers continue to pay top dollar for the images they need and that only new customers jump on the Thinkstock bandwagon.
Based on my analysis I think the gross revenue generated in the stock photo industry has been flat at about $1.3 to $1.5 billion for still photography in the last decade. (See
analysis)
Certainly there has been a dramatic increase in the number of images used annually – not in print, but definitely online. There has also been a dramatic increase in the number of images available in almost every subject area. This huge oversupply allows customers to find something that will work almost as well as the best, at a fraction of the cost of the best. And since most of the uses are online and will only be viewed for a few seconds the image doesn’t have to be a powerful as one that is used full page in print. The other problem is that people buying images for online use are only willing to pay a small fraction of what they used to pay to use an image in print. They get more of the images they use by grabbing them for free through a Google search.
Taking Market Share From Shutterstock
Last year Shutterstock spent over $30 million on ad words and SEO to bring their name to the top of the search results when people go looking online for images. Shutterstock has 750,000 customers. If we could compare customer lists my bet is that a very high percentage of the Gettyimages customers also use Shutterstock. Most customers that occasionally use Getty’s expensive images also have projects where they need a high volume of images at low price. In such cases they go to Shutterstock or one of the other microstock sites. For a while they used to go to iStockphoto, but Getty has pushed iStock prices up so high that many customers seek other cheaper alternatives. More often than not that alternative was Shutterstock.
I doubt Getty generated anything close to $30 million from Thinkstock last year. They will have to throw a lot of money at advertising and promotion to begin to take share from Shutterstock. And, if Getty does that Shutterstock will simply raise the price of what they are paying for adwords, and the money they spend on other marketing. Getty may be bigger in gross revenue, but overall their business is much less focused than Shutterstock’s. They must balance the needs of several lines of business, not focus exclusively on Thinkstock. And, given Getty’s debt and what it costs to service that debt they don’t have unlimited resources to throw at Thinkstock marketing.
All in all, I think Shutterstock is likely to be the winner in this battle and Getty’s fortunes are likely to further decline.