Interesting take on the Getty/Shutterstock news from the Millwaukee Independent

https://www.milwaukeeindependent.com/explainers/big-photo-getty-images-shutterstock-merge-3-7b-deal-form-new-visual-content-powerhouse/

So customers feel their situation was sidelined by the happy-talk from the two CEOs at yesterday's conference call:

"Representatives of Shutterstock have begun to offer reassurances to its subscribers, specifically telling the �Milwaukee Independent� that in the near term, nothing would change in how Shutterstock customers license images, videos, and other media. A company spokesperson also explained that there would be no immediate impact on how Shutterstock subscribers sourced, purchased, or managed content.

The merger is expected to offer customers more options to license content, as a benefit from the combined libraries. But despite belated efforts to reassure existing clients, the manner in which Getty Images and Shutterstock unveiled their deal has left some uneasy.

In many creative and editorial circles, the announcement sparked initial concern from businesses that rely on Shutterstock images. The fear is that the more expensive and stricter licensing by Getty Images would dictate massive changes.

Such apprehension was magnified by what critics say was an overly celebratory tone from the merging corporations by highlighting the revenue from their stocks, yet offering minimal public-facing information about the benefits to their customers.

�Both companies put all their energy into celebrating the new massive value and stock revenue windfall, while completely omitting any message or information to their extensive customer base,� said a consultant for a small nonprofit that relies heavily on stock photography via Reddit. �That only escalates the fear that policies and pricing structures could shift with little warning. It�s left people feeling anxious about how the transformation might jeopardize budgets or access to content.�

More to read:

https://www.reddit.com/r/photography/comments/1hvq4np/getty_images_and_shutterstock_to_merge/

https://www.hollywoodreporter.com/business/business-news/getty-images-merger-shutterstock-1236103000/

https://www.fastcompany.com/91256130/getty-images-shutterstock-merge-3-7-billion-deal

The above article mentions competition from genAI images; both CEOs dismissed any impact on their licensing from genAI in the Q&A section of yesterday's conference call. Either they were just spouting the party line, or possibly that isn't really a major factor in deciding to merge?

"The merger comes at a time when companies that use still images are facing increased competition from images generated by artificial intelligence. The companies said Tuesday that they have complementary portfolios and that a merger will provide customers with a broader array still imagery, video, music, 3D, and other media."

There's a lot of overlap in the collections.

Ignoring all the agencies Getty acquired in its early years...

Getty acquired iStock in 2006, not 2009

Getty acquired Jupiter Images (and thus StockXpert) in 2008

https://www.cnet.com/tech/computing/stock-art-consolidation-getty-to-buy-jupiterimages/
https://www.selling-stock.com/Article/getty-images-to-acquire-jupiterimages-for-96

Visual China Group acquired Corbis; Getty just has distribution rights outside China

https://petapixel.com/2016/01/22/corbis-images-sold-by-bill-gates-to-china-visual-group/
https://www.dpreview.com/news/7484881039/corbis-images-content-to-be-distributed-by-getty

Shutterstock acquired BigStock in 2009

https://www.selling-stock.com/Article/shutterstock-announces-acquisition-of-bigstoc

There's an article from Selling Stock about other acquisitions (written in 2014)

https://www.selling-stock.com/Article/stock-agency-acquisitions

https://petapixel.com/2024/12/23/us-senate-passes-bill-that-makes-it-easier-for-photographers-to-film-in-national-parks/

"...the EXPLORE Act will no longer require photographers or videographers to get filming permits because they may be paid for the footage or images." The group has to be six or fewer people and has to be in an area where people are allowed in the parks.

There are other elements in the act as well:

https://www.rei.com/action/network/campaign/americas-outdoor-recreation
https://www.tpl.org/media-room/passage-of-the-explore-act-reflects-a-transformative-milestone-for-outdoor-access-in-america

�.when were they ever not "cutting royalties from contributors"!?

Believe it or not, back in the beginning they did steadily increase royalties - from 20 cents to 23 (for those of us around during the buggy start of FTP uploads) to 25 cents and then the tiered system that paid 38 cents.

All the agencies were much more reasonable when they didn�t have content and were afraid to lose us�

Thought it worth adding an article from early November that talked about the problems with Shutterstock's acquisition spree and suggesting it was an interesting short opportunity for investors:

https://finance.yahoo.com/news/shutterstock-inc-sstk-bear-case-162730125.html

"SSTK�s top-line growth has largely been driven by acquisitions, a trend that may not continue . . . This reliance on acquisitions, combined with a gradual decline in subscriber numbers and revenue per subscriber metrics, signals a troubling trend that management has not adequately addressed."

"Furthermore, data from ALTD shows a notable decline in e-commerce sales that contradicts management's assertions, further validating the bearish thesis. Concerns regarding management integrity are heightened by prior misrepresentations about the performance of their e-commerce segment, which raises questions about the reliability of their segment reporting and overall transparency. "

That second quote is intriguing. It would be a big deal if the reports weren't accurate

Thanks for the link - I didn't see email (and I did check my spam/junk folder). I completed the survey.

Can you elaborate on why Adobe is surveying contributors?

Adobe (ADBE) announced their quarterly results Dec 11 after the market closed. The stock dropped in after hours trading and continued to fall today - closed today at $474.63 a share, down $75.30 (13.69%) from yesterday.

The revenue and earnings for the quarter were good but the lower than expected growth for the coming fiscal year disappointed investors. They're worried that Adobe isn't able to "monetize" AI tools.

https://finance.yahoo.com/news/analysts-revisit-adobe-stock-price-123216031.html

https://www.investors.com/news/technology/adobe-stock-ai-monetization-in-focus/?src=A00220

From a Barron's article that's behind a paywall:

"Investors are concerned the company isn�t yet seeing major gains from its AI offerings, which it has been monetizing for about a year now. One of those offerings is Firefly, which gives Adobe users the ability to use gen-AI to create images and videos from text, edit images using AI, and more. " . . . �We don�t see GenAI helping to bend the growth curve in the foreseeable future. And [with] guide suggesting growth is teetering on single digits, we think this will weigh on valuations,�

From our perspective as contributors, I think the major concern for 2025 would be that our content will be used as needed to support their "AI tools and features are driving revenue/profit growth" message which may end up with lower royalty revenues for us. As we have been promised 33% of either customer payment or a computed payment for unlimited plans, that can still be true but meaningless. 33% of eff-all is eff-all.

The other day Adobe and Box announced a collaboration via Adobe Express. There was no specific mention of stock images (versus the customer's own product images) but if these are very low cost/high usage plans, we could see our "custom" royalties drop.

https://blog.adobe.com/en/publish/2024/12/10/adobe-express-for-box-bringing-together-creativity-collaboration-in-the-cloud

One analyst noted that Adobe had pointed to slower subscriber growth:

https://www.gurufocus.com/news/2631524/adobe-shares-slide-as-revenue-forecast-misses-expectations-ai-competition-looms

Adobe's slides and press release are on their Investor Relations page:

https://www.adobe.com/investor-relations.html

Adobe's CEO noted in his statement at the beginning of the earnings call that Firefly-powered generations had surpassed 16 billion. At first that struck me as a very big number for a not-very-good genAI tool. Uncharitably I first thought it meant that you had to generate so many times to get anything usable, thus driving up their counts!

I think the odd phrasing means that they're counting the Remove tool (Phtoshop and Lightroom) and the various generative expand options - those are OK for very low res images or very small sections, but are otherwise not up to scratch. I don't know how they're tracking every use of the Remove tool with Generative AI turned on, but assume they must be to calculate credits usage.

So the big number may be accurate, but not really comparable to Midjourney or any other genAI tool


Edited Dec 13 to add an article link:

https://finance.yahoo.com/news/lack-roi-ai-investments-rattles-190529459.html

"The earnings report is missing one key metric: Return on AI investments. In fact, it would be more accurate to say that the company does not even have a metric to measure those returns with. Investors can be very short-sighted, and they want to see visible improvements. AI offerings were supposed to improve the company�s subscriber base. They didn�t. The investments were supposed to aid the growth of a company that was otherwise reaching a stage of maturity. They didn�t. So what can the company do better during the next year so that 2026 is different?

That�s the million-dollar question that shareholders want answered. The company�s strategy will become clear with time. But with modest growth prospects, and reliance on share buybacks to reward investors, many shareholders are likely looking for a better investment."

ADBE was down again today; dropped as low as $456, but closed at $465.69.

Edited Dec 16: ADBE down today, closing at $461.53

The total collection size is now 603,641,179. In the last 6 days (Dec 10 - 16) it has grown by over 5 million (5,159,959). Over 4.2 million of that 5 million were genAI.

Edited Dec 17: ADBE down, closing at $455.23. That's down almost $100 a share since results were announced last week (closed at $549.93 Dec 11).

...If I add grain in Photoshop 80% of you would assume it's a real photo.
https://i.ibb.co/mBmJr5p/Universal-Upscaler-dc3663a9-364e-434a-978f-356af59f4967-grain.jpg

This just screams fake.

Arguably not too different from the over-airbrushed, liquify-filter, skin smoothed fashion covers that have been around for years, but now those are churned out in industrial quantities, not handsful.

The masses of getAI people images on Adobe Stock look like a clone army of slick and polished humanoids.

The main issue is the size of the market for stock images. It's not growing anything like as fast (at an educated guess) as the supply of content. And there's only a portion of the buyer population who want the shiny-happy-fakey humanoids. If what was being produced with genAI substantially increased the size of the customer group or the volume of content they're licensing this might be a game changer.

As it is, the more of the look-alike content being generated just increases competition for the buyers who do want that look.

There was a thread about lowest custom rate on Adobe, but I can't find it right now, so I'll post here.   
Today I had lowest yet - 30 cents.  Until today lowest was 0.31

Over the last few weeks I've seen several $0.30 custom royalties - on Nov 27 & 28 as well as yesterday.

I believe we were told explicitly that there is no floor to the custom rates - it's 33% of what the buyer pays. That might be a constructed price based on total downloads the previous day for unlimited plans

https://www.microstockgroup.com/fotolia-com/adobe-stock-announcing-pro-edition-for-creative-cloud-for-teams-and-enterprises/msg563164/#msg563164

https://www.microstockgroup.com/fotolia-com/announcing-adobe-creative-cloud-express/

Look at your Getty/iStock Connect statement - you'll see lots of royalties less than one cent. Not that it's a contest I'd want to win

Looking at my November statement (for October royalties) I think 0.42 cents (i.e. $0.0042) was the lowest royalty for a license (i.e. not Cost per View).

The default order when you do a search on Adobe Stock (at least in the US) is "Relevence". Many days and with many searches, the top half of the first page is almost all AI images. IMO the massive volume of new (and generally low quality) genAI acceptances means that leaving it to Adobe's software to sort it out is wishful thinking. That sort of thing used to work when collections were smaller, inspections actually meant something and new work was a smaller proportion of the total collection size.

In five days - from Nov 21 to yesterday afternoon (Nov 25) Adobe Stock's total collection grew by just over 6 million items (6,075,697).

Nearly 5.5 million (5,499,162) were genAI.

Let those numbers sink in. And think about the possibility that the genAI content will slowly drive away everything else, and then buyers will drift away when they're bored with the sameness of everything left. Forget what's in my best interests as an individual contributor; Adobe Stock is taking a huge gamble that (a) genAI nearly-like-real-life content is OK with buyers and (b) that if it is, in time buyers will be able to find cheaper places to get it (Freepik's genAI collection is now 168.18 million) or make it themselves.

I've been licensing stock for just over 20 years. I remember a big celebration at iStock when they reached 1 million images...

Quote from: Jo Ann Snover on November 21, 2024, 15:36

...
Over all, the collection grew 32% between the end of April 2024 and today, but the genAI portion of the collection grew 82% versus the human-made portion grew 6.1%.
...

do we have actual numbers in each case? 6% of a very large number can be much greater than 82% of a much smaller number

Adobe Stock growth Apr 30 - Nov 21 2024; roughly 7 months

total collection: 139,801,939 (576,474,125 up from 436,672,186) - up 32%

genAI: 117,178,564 (181,469,399 up from 64,290,835) - up 82%

human made: 22,623,375 (395,004,726 up from 372,381,351) - up 6.1%

human made asset types

photos growth 9,936,406 (228,291,001 up from 218,354,595) - up 4.5%

videos shrunk 3,202,090 (15,884,530 down from 19,086,620) - down 16.8%

illos growth 1,990,088 (33,691,112 up from 31,701,024) - up 6.3%

genAI asset types

photos 49,408,590 (71,313,378 up from 21,904,788) - up 126%

illos 65,134,599 (106,056,450 up from 40,921,851) - up 59%

videos 846,305 (1,237,747 up from 391,442) - up 116%

Contributors to Adobe Stock won't be surprised to hear that the genAI content in the collection has been increasing faster than the human-made content.

Over all, the collection grew 32% between the end of April 2024 and today, but the genAI portion of the collection grew 82% versus the human-made portion grew 6.1%.

The human-made video collection shrank over that period - by over 3 million images; 16.8%. I assume that means some content left - does anyone know about that? It's not the Pond5 content which was much larger and left in July 2022.

I have no sales data, obviously, but I would guess that the genAI collection size is growing faster than genAI sales - too many kinds of content genAI isn't very good at and massive piles of similars for the things it is.

Possibly the ability to modify Adobe Stock items with genAI and then download will motivate buyers? It's a shame that we will only see "custom" in the royalties list so can't know - unless we find an image in use - if it's part of that program. I'll definitely be interested to see what impact that new feature has on our earnings.

As I don't upload genAI content, my sales would have evaporated if buyers have given up on traditional images. October 2024 was slightly ahead of October 2023 (my portfolio is small, just under 2500 images, and has grown very modestly this year. Nowhere near the 32+% growth in the collection).

Adobe Stock's total collection earlier today was 576,474,125 . For comparison, Shutterstock (as reported on the bottom of their landing page) went from 485+ million at the end of 2023 to 520+ million at the end of September 2024 - about 9.3% growth.

Anyone else have thoughts about Adobe Stock marketplace?