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Author Topic: Shutterstock Reports Q3 2014 Results  (Read 12484 times)

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« Reply #50 on: November 09, 2014, 04:49 »
0
It doesn't matter if it is a tiny niche that only has 20 buyers a year if you are the only one with pictures of it.

Surely something niche is better sold at a site like Alamy where it has the potential to earn more. And, also, RM - so that repeat and additional uses are also paid.


« Reply #51 on: November 09, 2014, 05:01 »
+1
It doesn't matter if it is a tiny niche that only has 20 buyers a year if you are the only one with pictures of it.

Surely something niche is better sold at a site like Alamy where it has the potential to earn more. And, also, RM - so that repeat and additional uses are also paid.

With Alamy's low sales - meaning possibly no sale ever - and RM licenses going for $20 commission (and 25 year RM licenses kicking about), I would think there is an excellent chance of SS delivering bigger returns on something like this. One SOD or EL at Shutterstock could be worth more. The Arab foods I'm doing at the moment are mainly intended for Photoarabia, in the hope that they may develop a decent market in the Middle East over the next couple of years.

« Reply #52 on: November 09, 2014, 07:27 »
+9
Here's the thing that scares the crap out of me...

Look at the chart for "Historical Operating Metrics"...

The rate of growth in the image collection has been accelerating at a frightening pace.

From Q3 to Q4 2012, the collection grew by 7.4%.  That rate of increase steady rises from quarter to quarter, and in the most recent period, from Q2 to Q3 2014, the collection grew by 10.0%

THIS is why we're making less and less while we upload more and more.  Unless you're an uploading machine, you cannot keep your port growing at the accelerating rate of the overall collection. 

If this trend continues, most of us will watch our SS earnings continue to dive no matter how hard we work. 

Very discouraging stuff, and it's making me question how much blood, sweat and tears I will continue pouring into microstock. 

« Reply #53 on: November 09, 2014, 08:54 »
+3
Here's the thing that scares the crap out of me...

Look at the chart for "Historical Operating Metrics"...

The rate of growth in the image collection has been accelerating at a frightening pace.

From Q3 to Q4 2012, the collection grew by 7.4%.  That rate of increase steady rises from quarter to quarter, and in the most recent period, from Q2 to Q3 2014, the collection grew by 10.0%

THIS is why we're making less and less while we upload more and more.  .

Look at the actual number of added photos and you'll be even more scared. Even if the rate had remained at 7.4% throughout, the growth would still be exponential. If you have 7.4% increase per quarter in a collection of 100,000 images then in Q1 you add 7,400, in Q2 you add 7,950, in Q3 you add 8,500 and in Q4 you add 9,160, over the course of a year you have increased from 100,000 to about 133,000.

It's always been clear that nobody can keep up with collections that are growing 30, 40 or 50% a year. The miracle is that the agencies have found enough buyers for us still to be able to make some money more than 10 years after this began.

« Reply #54 on: November 09, 2014, 11:34 »
0
Here's the thing that scares the crap out of me...

Look at the chart for "Historical Operating Metrics"...

The rate of growth in the image collection has been accelerating at a frightening pace.

From Q3 to Q4 2012, the collection grew by 7.4%.  That rate of increase steady rises from quarter to quarter, and in the most recent period, from Q2 to Q3 2014, the collection grew by 10.0%

THIS is why we're making less and less while we upload more and more.  Unless you're an uploading machine, you cannot keep your port growing at the accelerating rate of the overall collection. 

If this trend continues, most of us will watch our SS earnings continue to dive no matter how hard we work. 

Very discouraging stuff, and it's making me question how much blood, sweat and tears I will continue pouring into microstock.

But the revenue pie is not being shared out between images but between contributors. I very much doubt that the number of contributors (who actually know what they are doing) is growing at anything like the same rate.

A huge number of the new images being accepted are multiple similars of LCV subjects. There are contributors out there that are working incredibly hard to generate massive portfolios of images ... most of which will never sell. Even if the images themselves are ok then some folk are uploading 10 or 20 nearly identical images when 1 or 2 would have been enough. Microstock has always been more about working smart than working hard.

As I wrote in an earlier post the libraries actually grew much faster as a percentage of the total at the start of microstock. For example SS's library grew in size by more than 100x between 2005 and 2008.

« Reply #55 on: November 09, 2014, 11:53 »
+2
I hope all of you people who rely on SS for income have a Plan B in place. Because they are running over the competition like a steam roller. When they have dominant market share, and stock price growth stalls, they will have no choice but to start changing contributor terms to improve their financials. And at that point they know they will be able to do whatever they want to contributors.

I don't know if you have to wait that long, from what I remember every earnings report investor call has had a question about royalty rates and the company is beating expectations every quarter.  It might just take one quarter of meeting expectations?


That would be a very dangerous game for SS to play. Istock already tried 'management by quarterly target review' when H&F were their masters ... and look where it got them.

If SS were to destroy itself through greed, as IS did, then another agency or two would simply step up to take their place.

I'd definitely have concerns if Oringer were to walk away but I don't think he will. It's now a game to him. He wants to make SS as big as possible and he knows that he won't achieve that by messing with either his customers or his contributors. If short-term greed were in his nature then we'd already have witnessed it. Instead the opposite is true.

So far they have been consistent in saying they aren't planning on changing the royalty rates.  One thing that bothers me from their answers is that some quarters they say the royalty rate has been and will be 28% while other quarters (including the most recent one) they said the royalty rate was about 30%.  Maybe that's not such a big deal but with the amount of money they are dealing with the difference between 28 and 30 percent is over $500,000 in royalties paid per month.

My point was more about investor pressure than how great Jon is, I'm not sure how much influence investors have over the company.


Documentation of Insight Venture Capital Insider Moves http://tinyurl.com/lfeszaw

Insight Venture Capital placed insiders within shutterstock and not only granted them key positions within the company but large quantities of stock at a cost of $0. They also own a significant portion of its stock under various entities. These are large and easily tracked INSIGHT VENTURE PARTNERS V L P, SHUTTERSTOCK INVESTORS I LLC & Institutional holdings via INSIGHT HOLDINGS GROUP, LLC

SSTK Insider Activity (SEC Form 4)
http://www.nasdaq.com/symbol/sstk/insider-trades

There is no questionthat these key holders will not hesitate to squeeze contributors if they see their positions losing value via plunging stock prices. In fact I am sure they have been doing so since March 2013 when Insight Venture Capital previously put key stakeholders in place to build and implement the new search that they rolled out out in March.

http://www.nasdaq.com/quotes/institutional-portfolio/insight-holdings-group-llc-651789

Top 5 Insider Trades
SHUTTERSTOCK INVESTORS I LLC       2,835,697
ORINGER JONATHAN       2,530,000
INSIGHT VENTURE PARTNERS V L P       1,610,000
INSIGHT VENTURE PARTNERS V L P       1,610,000
INSIGHT VENTURE PARTNERS V L P       1,300,000

Top 5 Holders of Institutional Holdings
1.      PRICE T ROWE ASSOCIATES INC /MD/    2,729,747
2.      WELLS FARGO & COMPANY/MN    1,923,913
3.      WELLINGTON MANAGEMENT CO LLP    1,344,486
4.      JACKSON SQUARE PARTNERS, LLC    1,318,414
5.      INSIGHT HOLDINGS GROUP, LLC    1,289,748

http://www.nasdaq.com/symbol/sstk/ownership-summary#ixzz3IafANBvJ

« Last Edit: November 09, 2014, 11:58 by gbalex »

Photominer

« Reply #56 on: November 09, 2014, 12:02 »
0
It's quite popular in the Middle East as part of a meze. It doesn't matter if it is a tiny niche that only has 20 buyers a year if you are the only one with pictures of it. It's no different from shooting something that sells 20 million licenses a year, if evry picture of yours has a million competitors. In fact, it's better, because my image is always going to be on the first page of the search, if I shoot Girl With Headphones I probably won't be in the first 40 pages.
It's shredded chicken in a walnut, bread, stock, onion and spice sauce drizzled with a mix of walnut oil and paprika. It's surprisingly nice, actually.
That's it in a nutshell. What is a tiny niche to you? When GI did their "free" portal thing, there were a number of posts about bloggers being a negligible market. But to whom? If SS (for example) has over a million buyers, what is negligible? 1%? If I had 10k buyers (or even a fraction of those like 100 regular buyers), I'd be smiling all the way to the bank...

I agree though, even 20 buyers can be quite lucrative, especially if the picture is of something you were doing anyway like my food pix. There are a huge amount of mainstream items not well covered or barely covered. You just have to go look.

« Reply #57 on: November 09, 2014, 14:38 »
+1
It's quite popular in the Middle East as part of a meze. It doesn't matter if it is a tiny niche that only has 20 buyers a year if you are the only one with pictures of it. It's no different from shooting something that sells 20 million licenses a year, if evry picture of yours has a million competitors. In fact, it's better, because my image is always going to be on the first page of the search, if I shoot Girl With Headphones I probably won't be in the first 40 pages.
It's shredded chicken in a walnut, bread, stock, onion and spice sauce drizzled with a mix of walnut oil and paprika. It's surprisingly nice, actually.
That's it in a nutshell. What is a tiny niche to you? When GI did their "free" portal thing, there were a number of posts about bloggers being a negligible market. But to whom? If SS (for example) has over a million buyers, what is negligible? 1%? If I had 10k buyers (or even a fraction of those like 100 regular buyers), I'd be smiling all the way to the bank...

I agree though, even 20 buyers can be quite lucrative, especially if the picture is of something you were doing anyway like my food pix. There are a huge amount of mainstream items not well covered or barely covered. You just have to go look.

I cook, shoot and eat, so the cost to me of turning out food images is negligible, though there's some extra waste.  Looking at my total earnings over the last 10 years, the average return per image in my portfolio is about $20. Not a lot, but if shooting an extra 10 food pictures one day is going to bring in another $200 over the next 10 years it is still a worthwhile day's work.
On the other hand, I went to Venice once to shoot stock, that's a fairly high commercial value destination and my pictures sank almost instantly, without trace. It was an interesting trip but it's pretty clear it will never recoup its costs.  I've made quite a nice pile of cash from Santorini - but that's only because I was one of the very first microstockers to upload pictures of the famous churches.  I would say that breaking into a high-commercial-value area these days probably requires an absolutely extraordinary interpretation of the subject (which is then probably too good for the micros), if your pictures are just superb microstock HCV work then they are likely to be competing unsuccessfully against established, equally superb images and to be lost in the nether regions of the search before they've made an impact.  Yuri's HCV, high production cost, work now only seems to sell two or three times faster than my LCV, dirt-cheap, work; at one time he was outselling me 20 or 30-fold or more.

« Reply #58 on: November 09, 2014, 15:44 »
+2
But the issue is how many people WANT a picture of Circassian chicken etc. When we get into really tiny niches, the game has to be well nigh over. I could do pics of all the local variations of biscuits in Italy - can't imagine selling (m)any....
PS I have no idea what Circassian chicken is except it invoves walnuts (!) and maybe it is an extremely popular thing....somewhere....

Sometimes you don't know until you fill the niche :) I had Bell's Palsy in the summer of 2013 and did some stock photos of my face in that state as I saw just diagrams on SS and other sites at the time. I now see a man as well.

One of that series is now climbing the charts in my top 100 (by downloads). I'm not suggesting one can become Yuri Arcurs on such niches, but there are a lot of unfilled areas with smaller markets. A bit like indie films versus high budget blockbusters - if you can do the work on a low budget and have access to something authentic for the niche in question (there's no way to fake Bell's Palsy shots!), there are still opportunities.

If there was some big burst of interest in traditional Italian biscuits (think artisinal salts and other food fads that come and go)...

Photominer

« Reply #59 on: November 09, 2014, 16:24 »
0

Sometimes you don't know until you fill the niche :)
Yup. My Tahitian wedding chair is a good example of something very rare. But I've never sold it once. :)

Photominer

« Reply #60 on: November 09, 2014, 16:33 »
0
I cook, shoot and eat, so the cost to me of turning out food images is negligible, though there's some extra waste.  Looking at my total earnings over the last 10 years, the average return per image in my portfolio is about $20. Not a lot, but if shooting an extra 10 food pictures one day is going to bring in another $200 over the next 10 years it is still a worthwhile day's work.
I got into food photography mainly for the simplicity. I eat every day and my wife is a great cook, so adding a small bit of styling or plating was hardly any stretch. I put my setup between the kitchen and dining area and spent approx 1-2 minutes right before supper to shoot 90+% of my food portfolio. Then I ate it. :) My costs are purely time since everything else is either already paid for, or for other uses (like eating). That's what micro is for me. Spending a lot of money on a (micro) shoot just wouldn't be viable for me. I am amazed that others can do it, and it speaks to how good they are if they can. Otherwise, why pay more than peanuts to make peanuts?

Photominer

« Reply #61 on: November 09, 2014, 16:41 »
+1
There is no questionthat these key holders will not hesitate to squeeze contributors if they see their positions losing value via plunging stock prices. In fact I am sure they have been doing so since March 2013 when Insight Venture Capital previously put key stakeholders in place to build and implement the new search that they rolled out out in March.
Not trying to start an argument, but where exactly do you see contributors being squeezed? I haven't seen any reductions in royalties? Can you clarify exactly how we are being squeezed to get more profit to shareholders?

Tryingmybest

  • Stand up for what is right
« Reply #62 on: November 09, 2014, 17:12 »
+3
Good news. Now they can raise our commissions.

- Third quarter revenue increased 41% from prior year to $83.7 million
- Adjusted EBITDA increased 36% to $17.3 million
- Quarterly paid downloads increased 23% to 31.2 million
- Revenue per download increased 13% to $2.65
- Image collection grew 44%; currently exceeds 44 million images and 2.1 million video clips

Read more about it here;

http://seekingalpha.com/pr/11606925-shutterstock-reports-third-quarter-2014-financial-results?app=n

Uncle Pete

« Reply #63 on: November 09, 2014, 18:48 »
+1
Thank You! I've been trying to point out the same information and get pooh poohed with "algorithm change", capping, blackouts and who knows what else. Personally the IS exclusives coming over are a drop in the bucket, but part of the problem.

June 2012 20 million images. Aug 2014 40 million images.

Exactly what you have been saying. We can't keep up with that doubling of competition, and even an uploading machine, won't keep up with 10 million new images by March or April 2015.

We are bound to lose our share of the sales. This is not any great or mysterious discovery. Just that people don't want to admit that we are getting buried by the numbers.



Here's the thing that scares the crap out of me...

Look at the chart for "Historical Operating Metrics"...

The rate of growth in the image collection has been accelerating at a frightening pace.

From Q3 to Q4 2012, the collection grew by 7.4%.  That rate of increase steady rises from quarter to quarter, and in the most recent period, from Q2 to Q3 2014, the collection grew by 10.0%

THIS is why we're making less and less while we upload more and more.  Unless you're an uploading machine, you cannot keep your port growing at the accelerating rate of the overall collection. 

If this trend continues, most of us will watch our SS earnings continue to dive no matter how hard we work. 

Very discouraging stuff, and it's making me question how much blood, sweat and tears I will continue pouring into microstock.

Photominer

« Reply #64 on: November 09, 2014, 19:49 »
+1
Thank You! I've been trying to point out the same information and get pooh poohed with "algorithm change", capping, blackouts and who knows what else. Personally the IS exclusives coming over are a drop in the bucket, but part of the problem.

June 2012 20 million images. Aug 2014 40 million images.

Exactly what you have been saying. We can't keep up with that doubling of competition, and even an uploading machine, won't keep up with 10 million new images by March or April 2015.

We are bound to lose our share of the sales. This is not any great or mysterious discovery. Just that people don't want to admit that we are getting buried by the numbers.
I guess it depends on how you define "competition". Within my niches, who shoot to my target audiences, who market themselves the same way, have roughly the same quality and portfolio size, I just don't see the cause for alarm yet. I'm not competing with 40 million images. In some cases not even a few hundred. I think those who go after specific targets and do the research will see the gains. I think the hyper-competitive fields will be much tougher though. I'd love to see stats on how much of the 40 mil library is editorial, how much people, how much landscape, food, illustrations, etc...

ruxpriencdiam

    This user is banned.
  • Location. Third stone from the sun
« Reply #65 on: November 09, 2014, 20:06 »
-2
Here Pooh pooh on you some more! ;)



Thank You! I've been trying to point out the same information and get pooh poohed with "algorithm change", capping, blackouts and who knows what else. Personally the IS exclusives coming over are a drop in the bucket, but part of the problem.

June 2012 20 million images. Aug 2014 40 million images.

Exactly what you have been saying. We can't keep up with that doubling of competition, and even an uploading machine, won't keep up with 10 million new images by March or April 2015.

We are bound to lose our share of the sales. This is not any great or mysterious discovery. Just that people don't want to admit that we are getting buried by the numbers.



Here's the thing that scares the crap out of me...

Look at the chart for "Historical Operating Metrics"...

The rate of growth in the image collection has been accelerating at a frightening pace.

From Q3 to Q4 2012, the collection grew by 7.4%.  That rate of increase steady rises from quarter to quarter, and in the most recent period, from Q2 to Q3 2014, the collection grew by 10.0%

THIS is why we're making less and less while we upload more and more.  Unless you're an uploading machine, you cannot keep your port growing at the accelerating rate of the overall collection. 

If this trend continues, most of us will watch our SS earnings continue to dive no matter how hard we work. 

Very discouraging stuff, and it's making me question how much blood, sweat and tears I will continue pouring into microstock.


« Reply #66 on: November 09, 2014, 20:13 »
+3
Here Pooh pooh on you some more! ;)



Thank You! I've been trying to point out the same information and get pooh poohed with "algorithm change", capping, blackouts and who knows what else. Personally the IS exclusives coming over are a drop in the bucket, but part of the problem.

June 2012 20 million images. Aug 2014 40 million images.

Exactly what you have been saying. We can't keep up with that doubling of competition, and even an uploading machine, won't keep up with 10 million new images by March or April 2015.

We are bound to lose our share of the sales. This is not any great or mysterious discovery. Just that people don't want to admit that we are getting buried by the numbers.



Here's the thing that scares the crap out of me...

Look at the chart for "Historical Operating Metrics"...

The rate of growth in the image collection has been accelerating at a frightening pace.

From Q3 to Q4 2012, the collection grew by 7.4%.  That rate of increase steady rises from quarter to quarter, and in the most recent period, from Q2 to Q3 2014, the collection grew by 10.0%

THIS is why we're making less and less while we upload more and more.  Unless you're an uploading machine, you cannot keep your port growing at the accelerating rate of the overall collection. 

If this trend continues, most of us will watch our SS earnings continue to dive no matter how hard we work. 

Very discouraging stuff, and it's making me question how much blood, sweat and tears I will continue pouring into microstock.




You really should stick to the SS forum. Maybe folk over there would find your posts interesting and amusing. Probably not __ but at least it's worth a chance.


« Reply #67 on: November 09, 2014, 23:01 »
+1
There is no question that these key holders will not hesitate to squeeze contributors if they see their positions losing value via plunging stock prices. In fact I am sure they have been doing so since March 2013 when Insight Venture Capital previously put key stakeholders in place to build and implement the new search that they rolled out out in March.
Not trying to start an argument, but where exactly do you see contributors being squeezed? I haven't seen any reductions in royalties? Can you clarify exactly how we are being squeezed to get more profit to shareholders?
Those of us who experienced large drops when they rolled out the new search have explained ad nauseam, that the income drops occurred overnight.

If these sudden overnight drops in income had occurred because of large quantities of new exclusive content the drops would have occurred slowly over time.  Do you actually believe that the majority of exclusive content was uploaded overnight and that all exclusives jumped ship together on the very day our earnings were slashed? 

Most everyone I know who had large quantities of images in first pages experienced these drops. I do understand that if you did not have many images in first page searches to begin with, your sales would not have changed much.

We are now dealing with a venture capital firm and each quarter they prominently display "Revenue per download increased 13% to $2.65 " Do you really suppose that they choose to promote higher royalty contributors over comparable quality content from departing IS exclusives they initially pay $ .25

It will be interesting to see what occurs once SS has the lions share of exclusive content and those new members reach $ .38. New contributors from then on out will not have built up 10 plus years of content that they can upload with a few months or years work.
« Last Edit: November 09, 2014, 23:08 by gbalex »

Photominer

« Reply #68 on: November 10, 2014, 10:27 »
0
Ok, so if I understand correctly, you are saying that this group specifically targeted a segment of the contributor base to decrease their sales and increase the shareholder earnings?

Uncle Pete

« Reply #69 on: November 10, 2014, 10:46 »
0
Great point! I think Barry and I have been advocates of finding smaller needs that aren't over subscribed. Keep it up.

I also have never seen one of "Stockmarketers" works, but his targeting success and producing what's in demand, is also a good project direction. I never thought he'd hit the same wall that so many people run into.

Thank You! I've been trying to point out the same information and get pooh poohed with "algorithm change", capping, blackouts and who knows what else. Personally the IS exclusives coming over are a drop in the bucket, but part of the problem.

June 2012 20 million images. Aug 2014 40 million images.

Exactly what you have been saying. We can't keep up with that doubling of competition, and even an uploading machine, won't keep up with 10 million new images by March or April 2015.

We are bound to lose our share of the sales. This is not any great or mysterious discovery. Just that people don't want to admit that we are getting buried by the numbers.
I guess it depends on how you define "competition". Within my niches, who shoot to my target audiences, who market themselves the same way, have roughly the same quality and portfolio size, I just don't see the cause for alarm yet. I'm not competing with 40 million images. In some cases not even a few hundred. I think those who go after specific targets and do the research will see the gains. I think the hyper-competitive fields will be much tougher though. I'd love to see stats on how much of the 40 mil library is editorial, how much people, how much landscape, food, illustrations, etc...

Uncle Pete

« Reply #70 on: November 10, 2014, 10:49 »
0
Looks like chocolate ice cream or some fine whipped Chocolate pudding? It's some happy s41t whatever it is?  :)

Here Pooh pooh on you some more! ;)





« Reply #71 on: November 10, 2014, 10:58 »
+1
Ok, so if I understand correctly, you are saying that this group specifically targeted a segment of the contributor base to decrease their sales and increase the shareholder earnings?


The venture capital crowd understands that they have a short window of opportunity to drive stock prices up, grant themselves stock and cash out. http://www.nasdaq.com/symbol/sstk/insider-trades

They stumbled upon the perfect scenario with shutterstock a company who was openly willing to hold prices down to gain market share while its main competition was failing and large numbers of contributors were willing to jump ship with portfolios of proven content that they had built up over a number of years.


Photominer

« Reply #72 on: November 10, 2014, 11:09 »
0
Ok, so if I understand correctly, you are saying that this group specifically targeted a segment of the contributor base to decrease their sales and increase the shareholder earnings?


The venture capital crowd understands that they have a short window of opportunity to drive stock prices up, grant themselves stock and cash out. http://www.nasdaq.com/symbol/sstk/insider-trades

They stumbled upon the perfect scenario with shutterstock a company who was openly willing to hold prices down to gain market share while its main competition was failing and large numbers of contributors were willing to jump ship with portfolios of proven content that they had built up over a number of years.


Huh? is that a yes to my question or a no?

Lightrecorder

« Reply #73 on: November 10, 2014, 11:11 »
0
Here Pooh pooh on you some more! ;)
You really should stick to the SS forum.

This

Photominer

« Reply #74 on: November 10, 2014, 11:22 »
-1
They stumbled upon the perfect scenario with shutterstock a company who was openly willing to hold prices down to gain market share while its main competition was failing and large numbers of contributors were willing to jump ship with portfolios of proven content that they had built up over a number of years.
Sounds like good business practice for a company, isn't that exactly what made Walmart and Costco successful? Less so wonderful for us contributors. However, it is still miles better than all the agencies that actively decrease our commissions through shell games and parent companies skimming double royalties off of sales, or customer offerings that make us less and less money.




 

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