Public Company Dilemmas

Posted on 2/18/2016 by Jim Pickerell | Printable Version | Comments (0)

The three public companies in the stock photo industry – Getty Image, Shutterstock and AdobeStock -- face major challenges that will probably be impossible for them to overcome. Adobe is the possible exception because it can approach the stock image side of its business as a loss-leader that supports the other 98% of its business.

Owners and Investors

Owners and investors insist on quarterly revenue growth. When they don’t see it the company’s stock value declines, or in Getty’s case the value of its bonds and its ability to raise additional investment capital decline. It is very difficult, if not impossible, to make strategic adjustments that might result in temporary revenue declines or loses for several quarters, but in the long run could produce a healthier company.  

In a growing market delivering ever growing revenue and profits while still keeping suppliers and customers reasonably happy may be possible. But, in a mature market like the stock photography business,where there is very little growth, it becomes much more difficult to provide the service customers want; the compensation suppliers need in order to continue to produce, along with the revenue growth owners insist on.


Not only do customers want a cheaper product they also want service that saves them time. For the most part the market leaders have focused on giving the customers cheaper. Supposedly efficient technology solutions will provide the time savings.

But customers are complaining that the technology solutions are not saving them time. In fact, just the opposite is occurring. The companies are supplying an increasing volume of product requiring much more of the customer’s time to find something they can use. More choice is becoming a negative factor.

In years past, sellers provided personal services in sorting, editing and curating that saved customers time. That has all but disappeared, although some boutique agencies still provide it. In theory, technology was supposed to solve this problem, but it seems that it has gone about as far as it can go.

The distinctives that make a particular image right for a particular customer are very hard to define in words. Keywording has its limits. Either there are too many or too few words. Or the customer uses different words than the keyworder to mean the same thing. So far auto-keywording is worse, and it doesn’t look like there is much hope of it even getting as good as human keywording.

And even if it does, it seems that it will be impossible to train the customers to use exactly the same words that the agency has attached to the image.

What customers want is better curation so they are not asked to wade through a huge number of inappropriate images in order to find a handful that might work for their immediate use. This requires humans and humans cost money.


To keep their profits high the owners have required more and more of their suppliers. But the net revenue the suppliers receives has declined rapidly for several reasons:
    1 – The agencies have dramatically lowered the prices they charge for use of an image.
    2 -They have cut the royalty share.
    3 -They have cut staff thus giving producers less support in terms of guidance as to what the customers want.
    4 -They add images to their collections at a very high rate with little or no editorial judgment as to what their customers might want to use. This new material is being add much faster rate than growth in demand. Agencies have minimal cost to integrate this product into their collections. Otherwise they pay noting for additional product. There is no incentive to limit production in any way.
Thus, in order to maintain a proportionate position in the collection the creator must constantly produce more and more images at a high cost to him/her in time and expense.

Solving The Problem

To solve this problem for customer, owners would have to be willing to spend more of the revenue they take in. There is evidence that at least some customers are willing to pay higher prices for curated collections, but it is not clear that the increased revenue generated from these higher prices will be enough to offset the cost of curation. In fact, it is not even clear how much increased costs might be required to have a positive effect on sales.

In my estimation none of the curated collections we have now are a perfect solution, or even as good as the curated collections offered by the major agencies in the 1990s. Back in the 90s the editing for a print catalog (curated collection) occurred once a year. Now, considering the new material coming in curation updates might need to happen almost daily. That could result in a huge additional costs. Technology could help in solving some of this problem, but significant human curators would also be required.

Meanwhile, the declining revenue for suppliers is driving many out of the industry. These are the people who have been willing to spend the time necessary to understand the market. There are plenty of new suppliers who shoot what they like and throw it up online, but that only increases the chaos for the customer.

Copyright © 2016 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to:  


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