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Author Topic: Shutterstock Downloads Declining As A Percent Of Images In Collection  (Read 5034 times)

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« on: May 19, 2014, 08:36 »
+10
The chart below shows some of the trends in downloads relative to the number of images in the Shutterstock collection since the beginning of 2012. These numbers indicate that while Shutterstock sales per quarter have been steadily growing the number of images in the collection have been growing at a faster pace. Thus, the odds that any given image will be licensed is steadily declining.

To arrive at our percentage number we simply divided the total number of images in the collection into the total downloads. (The image and download numbers below are in millions.) Shutterstock reports the number of images and the number of video clips. We add these two numbers together for our image number since the downloads number includes both images and clips.

Some images are downloaded many times and others not at all. Thus, the actual percentages for each quarter would be much lower, but we suspect the trend would be relatively the same.


      Number       Number      Percent Image
      Images      Downloads   Licensed
Q1 2012   18.8          17.6      94%
Q2 2012   20.2          18.3      91%
Q3 2012   21.7          18.7      86%
Q4 2012   23.3          21.4      92%
Q1 2013      25          22.4      90%
Q2 2013      28          24.3      87%
Q3 2013   31.3          25.4      81%
Q4 2013   34.5             28      81%
Q1 2014   37.1          29.7      80%
« Last Edit: May 19, 2014, 08:38 by Pickerell »


« Reply #1 on: May 19, 2014, 10:17 »
0
interesting numbers, guess we have been watching that for a while

but with a 315 to 320 M $ revenue prediction for 2014, 5M $ in reviewing costs with a 20% acceptance ratio doesn't look much (if 10 cents per review)

storage must be a lot cheaper too

anyway what are your thoughts?
« Last Edit: May 19, 2014, 10:21 by luissantos84 »

« Reply #2 on: May 19, 2014, 11:12 »
+4
15% lower downloads/image in 2 years is not that bad, considering the exponential portfolio growth.

Just hope the majority of the new images are from "factories" shooting business people and not my area.

« Reply #3 on: May 19, 2014, 21:28 »
0
Quote
      Number       Number      Percent Image
      Images      Downloads   Licensed
Q1 2012   18.8          17.6      94%
Q2 2012   20.2          18.3      91%
Q3 2012   21.7          18.7      86%
Q4 2012   23.3          21.4      92%
Q1 2013      25          22.4      90%
Q2 2013      28          24.3      87%
Q3 2013   31.3          25.4      81%
Q4 2013   34.5             28      81%
Q1 2014   37.1          29.7      80%

In other words:
If the percentage of unsold images increased in two years from 6% to 20% (licensed images - 94% in 2012 vs 80% in 2014), in relative terms it is a 300% decline.

In two years, SS collection will be in 60-70 million ballpark, and if the present trajectory continues, percentage of licensed images will drop to only 60%.

MxR

« Reply #4 on: May 20, 2014, 01:43 »
0
Solution is: ...improve Quality...


stock-will-eat-itself

« Reply #5 on: May 20, 2014, 06:15 »
+5
SS are beginning to experience what has happened at iS the last couple of years.

Collection far outpaces the demand and contributors income declines no matter how much is uploaded or the how much quality is improved. I fear a crash with subs pricing will be far more painful than the exclusives are experiencing right now.

Ironically SS are spurning whole new business models compounding the problem with the likes of the 'Dollar Photo Club' as this is the only way other agencies can compete.

Agencies are never too concerned as their income always increases, eventually though the business model for contributors will snap and a McJob will be far more lucrative.

« Reply #6 on: May 20, 2014, 08:47 »
+3
Ironically SS are spurning whole new business models compounding the problem with the likes of the 'Dollar Photo Club' as this is the only way other agencies can compete.

Agencies are never too concerned as their income always increases, eventually though the business model for contributors will snap and a McJob will be far more lucrative.


Shutterstock openly admits that as a strategy to gain market share they strategically chose to not raise prices in 9 years, while they also acknowledge that images quality has risen dramatically.

By using long term price undercutting to successfully gain market share over other agencies; they leave other micro sites no alternative but to accelerate the race to the bottom in an attempt to compete.

As you mention they could have used alternate strategies, but it is no skin off their back if they devalue our assets. They still make bank even without the IPO which also gives them the option of printing money in the form of granting themselves free stock options worth millions.

For instance on the date 04/24/2014 the Shutterstock board granted Jonathan Oringer 100,000 shares of shutterstock stock at a cost to Jon of $0 per share.

Automatic Sales:  These are planned sales of their personal stock position as part of their personal financial strategies to liquidate some of their stock positions.

Option Exercise:  These are options that are awarded to high-level executives and board members (i.e., Directors) as incentives to remain with the company, especially in leaner, difficult times.  Every "Option Exercise at $0 per share" is essentially a grant of shares at the $0 value level.  Therefore, if they sold these shares, they could do so at the full market value on the day of sale.  Basically, these are part of these insiders' compensation packages that were negotiated for their participation and contribution to the company.

If you take a look at the link recording insider trades http://www.marketwatch.com/investing/stock/sstk/insideractions

You can easily see how much key insiders at shutterstock paid for their stock and how much they sold those shares for. Thilo sells 5000 shares every month as Automatic Sales.

Insight Venture Partners V L P SSTK Stock Sales Totaling $193,200,000 Paid $0 for its shares

Oringer Jonathan SSTK Stock Sales Totaling $144,969,000

Semmelbauer Thilo (President & COO) SSTK Sales Totaling $3,934,150 Paid $0 for his shares  He auto trades 5,000 shares each and every month and when they run out they grant him more @  $0

Chou James (Chief Technology Officer) SSTK Sales Totaling $987,000   Paid $0 for his shares

BERNS STEVEN (Director) SSTK Sales Totaling $499,350   Paid $17.5 for his shares

To see how much key stake holders paid for their granted stock options look under "Other Transactions":

Sort by clicking on the columns "Average Price" & "Total Amount" Paid for the SSTK shares to see the stock share transactions each person was "Options Awarded" Or "Other Share" Granted. They must love to see those lovely $0's

http://www.secform4.com/insider-trading/1549346.htm
« Last Edit: May 20, 2014, 08:54 by gbalex »

Ron

« Reply #7 on: May 20, 2014, 08:58 »
0
Bitter much

« Reply #8 on: May 20, 2014, 09:24 »
+6
Interesting stats. Thanks for sharing.

« Reply #9 on: May 20, 2014, 10:19 »
+5
The huge number of images now in the archive is like a big endowment fund - SS's near-term future is secure no matter what they do.

They could essentially stop accepting new images next week, cut their reviewing costs to zero, cap storage costs, increase profitability and stay in business for years by just selling what they already have.   Or they could cut royalties and do giveaway deals, cruise through a 'D-Day' that removes 5% of their images, and see their stock price go up.

Yes there are massive clouds on the horizon, but they're years away and of no concern to highly leveraged execs of a newly public company.
« Last Edit: May 20, 2014, 10:36 by stockastic »


 

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