Author Topic: What does Shutterstock really want? (Read 5515 times)

Chichikov · « **on:** June 05, 2020, 01:43 »

In recent days, like many of us, I have been wondering about Shutterstock's true intentions.
What is really behind this sudden change in the earnings structure?
What do they really want to do?
Where do they really want to arrive at?

In the current confusion it is very difficult to answer these questions.

A few days ago I had a little experiment:
I played the fool (which is not too difficult for me and comes quite naturally...) and I sent an e-mail to Shutterstock, playing the role of the poor disappointed little boy who doesn't understand what's happening ("I don't understand what's going on, for the last few days I've only had sales of 10¢, so to speak. Isn't it due to a bug in your system?")

The answer was not long in coming.
In short, they explain to me that the payment structure has changed (for my sake, of course - but we already knew that).
But that if I want I can either close my account, or deactivate it, which would allow me, if I change my mind, to reactivate it later...
They conclude by telling me they are (not "that they would be"!) sad to see me go.

This second part where they explain to me what to do to close my account or deactivate it, as well as their conclusion that, using the present tense, they are certain I'm going to do it, leads me to conclude that they really don't give a crap if the contributors leave.

What does Shutterstock really want?
The idea that's starting to germinate on the web is that the reason they're doing all this is so that they can be in a better financial position to be able to sell the company more easily.

And what do you think about that?

cobalt · « **Reply #1 on:** June 05, 2020, 01:58 »

By raising profits by cutting suppliers and then aggressively increasing „growth“ by blitz selling nanostock packages all over the world, they can indeed and at least on paper, make the company look very attractive.

I think it is becoming obvious they are preparing the company for sale.

They are debt free, pay a dividend and have 300 million in cash. The technology and the apps are excellent.

So it is not like they have nothing to offer.

The knack is that most investors will not be aware how crowd communities work and that the buyers, who are designers are also the poducers.

But purely on paper, if they can sell enough of these ultracheap subs packages, sstk will look like an interesting bet.

Any company that gets through the Pandemic and doesn‘t cut it‘s dividend, doesn‘t have to lay off employees will get glowing reviews when it is all over and a vaccine is available.

Also - Adobe is not paying out a dividend.

Many longtime, often retired, private investors have huge portfolios with a mix of various interest paying companies.

The real question, from my perspective - does Oringer just want to gradually get rid of his shares at ever increasing prices?

Or are they looking for a large company to buy him out?

cobalt · « **Reply #2 on:** June 05, 2020, 02:01 »

What would help is if Adobe in their next statement says they have a large influx of new buyers and producers who have left SS because of the scandal.

ETA:

in principle we should be able to follow if the target is simply the general investor community - then Oringer will gradually keep selling his shares or transfer larger parcels to a mix of institutional investors like blackrock. Then his percentage will go down, but these shares don‘t go through the market. It still has to be announced in public though.

But if he sticks to most of it, then he is looking for a buyout.

Actually if SS is taken over by a good company, that might be a bonus for us.

For Adobe we are just an add on to sell Adobe software. They are also not inclined to pay us less because we are their customers.

Plus we are ungrateful and unruly and cause shitstorms.

MicroVet · « **Reply #3 on:** June 05, 2020, 02:14 »

I would not be surprised that they are positioning themselves for acquisition.

And that explains why they created the $0.10 minimum per download when 15% actually represents $0.04 of most sales, 30% represents $0.08 and so on, for example. Does it make any sense that they created a 15% level when the sales of that level will almost always be bellow $0.10?

They created the $0.10 limit so that a new owner already has the tools to reduce even further the payment expense and make SS more attractive to potential buyers.

And it may not even take that long as I believe that later next year, after they have reset the levels in January, SS itself will drop the $0.10 limit and put all sales in the correspondent level to increase their earnings again. The $0.10 limit is just the well know strategy to soften the first blow.

So prepare yourselves to earn $0.04 per sale or little more.

cobalt · « **Reply #4 on:** June 05, 2020, 02:21 »

Very good point, they could lower the limit to 5 cents or just drop it altogether.

Then we will get sales for 2 cents or even a fraction of a cent like on Getty, but Getty balances it out, by occasionally dumping a 100 dollar sale on you.

So the current 10 cent limit, is probably masking a lot of sales that are much lower than that and are being rounded up.

The new owner can of course also adjust the yearly targets however they want, pushing us even further down. For this year I am sure they made the levels really easy to attain. At least...from their perspective.

They could also have factored in that overall volume will go up, when they aggressively sell nanostock packages. I think that is why the numbers in video are so unachievably high. If they sell enough nanostock subs, of course the volume of video sales will go up drastically.

Actually, maybe this is the reason pond5 created Hyperstock. They knew this is coming...SS promoting nanostock for video.

But in the end, if the producers don‘t supply, it all doesn‘t work. Some things just look on paper or screens.

Stockmaan · « **Reply #5 on:** June 05, 2020, 02:58 »

Maybe SS and Getty get together. Maybe this is the first step in merging.

Canonbabe · « **Reply #6 on:** June 05, 2020, 03:00 »

With this cut in royalty for us the profit for them is growing. On paper and only shortterm. When their customers notice there isn't that much new stuff available and/or big portfolio's are gone at all, they will quit SS.

Whatever they SS does: we are the ones that are paying for it! I hope all of us deactivate their work or at least stop uploading there.

When I checked my "sales" this morning I noticed this: Increase your discoverability > Upload a profile photo: Very tempting to upload something else: A contributor lives matter avatar or something like that!

thestuckpixel · « **Reply #7 on:** June 05, 2020, 03:05 »

cobalt · « **Reply #8 on:** June 05, 2020, 03:55 »

By the way, if we anticipate a takeover by another company, that might be an argument to turn off sales, stop uploading but keep the account itself active.

The sales process might take 2-3 years, but if the buyer company are good people, you just have to flick a switch and your port with 20 000 files is live again.

If the new owners are useless, change nothing and wait for the next buyer

Allsa · « **Reply #9 on:** June 05, 2020, 14:15 »

Quote from: cobalt on June 05, 2020, 03:55

By the way, if we anticipate a takeover by another company, that might be an argument to turn off sales, stop uploading but keep the account itself active.

The sales process might take 2-3 years, but if the buyer company are good people, you just have to flick a switch and your port with 20 000 files is live again.

If the new owners are useless, change nothing and wait for the next buyer

That's what I thought. I disabled my entire portfolio, and now they are now in the process of removing my entire portfolio. A few days ago I had over 2000 images on SS, I now have only 31.

Mrblues101 · « **Reply #10 on:** June 05, 2020, 15:02 »

I think they use COVID-19 in a very perverse way as the perfect moment to reduce contributors payment in order to made bigger profit.

Because of COVID most of people are at home and the only chance for them to made incoming is SS, some people is even in a critical economic situation due to COVID, and because of that they will accept 10cents revenue.

COVID-19 the perfect storm for SS

Pixart · « **Reply #11 on:** June 05, 2020, 15:07 »

It looks very much to me that yes, they are in the process of selling.

What are their expenses? Real Estate and the cost of doing business (paper, desks, phones, travel etc.), Employees (and benefits), technology, marketing, Contributors, Reviewers - what am I missing?

March 31 paid .17 per share in dividends.

June 1, promoted Pavlovsky to CEO and at virtually the same time as making abrupt changes:

- Unilaterally slashed one expense - what it pays to the actual owners of the content.
- Unilaterally fires content review team and contracts it out to Mumbai

*Note that the above two changes were made without notice. (No, 5 days notice does not count).

- On about June 2/3, it became apparent that content was declining faster than it was increasing. Possibly for the first time since SS came into business (This is an assumption, not an investigated fact)

- On about June 2/3 SS reaches out to select excellent content producers with an offer to grandfather their May 2020 rate through December 31, 2020 before resetting to 0.

There are two things of note. No notice of rate cuts and December 31, 2020. I believe that a change is imminent.

And yes, Oringer is slowly selling shares. June 1 and June 3 for roughly 1 million, although his still holds 16,240,365 shares, about $607M

https://www.marketbeat.com/instant-alerts/nyse-sstk-insider-buying-and-selling/

H2O · « **Reply #12 on:** June 05, 2020, 15:46 »

It's a classic case of 'Pump and Dump'

They are Asset Stripping the Company and the assets are the contributors.

Personally I believe that the American system of Capitalism seems to have become corrupted, mostly they act like the Mafia in the Martin Scorsese film Goodfellers.

Shutterstock shareholders are doing exactly the same at the moment, they are asset stripping the creatives.

And when they can't squeeze anymore cash out of the Company they will cash out, by selling the company on to someone else; Getty who have acted in a similar way has captive contributors in 'Exclusives' along with various collections of imagery from companies that it has acquired over the years, it has been able to effectively mortgage future revenues, these have been used to sell and buy the company from one bunch of Asset Strippers to another, leaving the company with heavy debts.

Shutterstock doesn't have Exclusives' or collections, their problem is the talent is walking, I know people who have for a long time had a problem with finding the right imagery, saying things like, 'Once you have waded through all the crap' and as we all know there is great piles of spammed imagery, this never used to happen.

All the full time contributors will also have worked or will be working or know people in the advertising and design business and will be prime influencers, this move is checkmate.

There is no mug to buy the Company, they have made a strategic mistake, they don't own or control anything, it is just a selling platform.

Pixart · « **Reply #13 on:** June 05, 2020, 15:50 »

Please comment on this (old) tweet. Edited to fix link

https://twitter.com/StevenBertoni/status/1227955940772761600

Steven Bertoni is a writer from Forbes, and here is the article about Jon:
https://www.forbes.com/sites/stevenbertoni/2020/02/13/shutterstock-founder-and-ceo-jon-oringer-to-step-down-in-april/#49bf0aa37e8b

Jo Ann Snover · « **Reply #14 on:** June 05, 2020, 18:22 »

Quote from: Pixart on June 05, 2020, 15:07

...On about June 2/3, it became apparent that content was declining faster than it was increasing. Possibly for the first time since SS came into business (This is an assumption, not an investigated fact)

I've been keeping track since the evening of June 2nd. Since then they've lost 1.7 million images (add to that whatever the uploads are which I have no insight into). They are dropping the number day by day that they say they are adding - it was 171,000 a day and now they say 160,400 a day

Numbers remaining 4pm June 5th and the change since 5pm June 2nd. Note that there is some overlap between illustrations and vectors, so the numbers don't add up

Photos
212,156,701   -1,322,077

Illustrations
111,156,382   - 510,107

Vector
69,675,150   - 302,972

All
324,066,312   -1,720,141

Chichikov · « **Reply #15 on:** June 06, 2020, 02:26 »

Quote from: Jo Ann Snover on June 05, 2020, 18:22

Quote from: Pixart on June 05, 2020, 15:07
...On about June 2/3, it became apparent that content was declining faster than it was increasing. Possibly for the first time since SS came into business (This is an assumption, not an investigated fact)

I've been keeping track since the evening of June 2nd. Since then they've lost 1.7 million images (add to that whatever the uploads are which I have no insight into). They are dropping the number day by day that they say they are adding - it was 171,000 a day and now they say 160,400 a day

Numbers remaining 4pm June 5th and the change since 5pm June 2nd. Note that there is some overlap between illustrations and vectors, so the numbers don't add up

Photos
212,156,701   -1,322,077

Illustrations
111,156,382   - 510,107

Vector
69,675,150   - 302,972

All
324,066,312   -1,720,141

Jo Ann, I don't see any video in your report.
I think a lot of the videos are also disappearing from their servers.
It would be interesting to know how many.

tätarätä · « **Reply #16 on:** June 06, 2020, 02:46 »

There is an oversupply of microstock images and also an oversupply on free images.

cobalt · « **Reply #17 on:** June 06, 2020, 03:09 »

Quote from: tätarätä on June 06, 2020, 02:46

There is an oversupply of microstock images and also an oversupply on free images.

But there is no oversupply of really relevant content. All agencies are screaming for modern, loclaized, fresh work with high production value.

But at 10 cents, it cannot be produced.

Free sites have an endless stream of sunsets etc...nobody pays models, rents a location and then puts the work on free sites.

tätarätä · « **Reply #18 on:** June 06, 2020, 04:03 »

Quote from: cobalt on June 06, 2020, 03:09

Quote from: tätarätä on June 06, 2020, 02:46
There is an oversupply of microstock images and also an oversupply on free images.

But there is no oversupply of really relevant content. All agencies are screaming for modern, loclaized, fresh work with high production value.

But at 10 cents, it cannot be produced.

Free sites have an endless stream of sunsets etc...nobody pays models, rents a location and then puts the work on free sites.

Cant talk about "for modern, loclaized, fresh work with high production value" like lifestyle.
Just doing food. There are quite a few professional food photographer giving away really good food images (20 MP +) for free at unsplash to get traffic on their instagram account.
Professional expensive work for free.

obj owl · « **Reply #19 on:** June 06, 2020, 10:53 »

Quote from: tätarätä on June 06, 2020, 04:03

Quote from: cobalt on June 06, 2020, 03:09
Quote from: tätarätä on June 06, 2020, 02:46
There is an oversupply of microstock images and also an oversupply on free images.

But there is no oversupply of really relevant content. All agencies are screaming for modern, loclaized, fresh work with high production value.

But at 10 cents, it cannot be produced.

Free sites have an endless stream of sunsets etc...nobody pays models, rents a location and then puts the work on free sites.
Cant talk about "for modern, loclaized, fresh work with high production value" like lifestyle.
Just doing food. There are quite a few professional food photographer giving away really good food images (20 MP +) for free at unsplash to get traffic on their instagram account.
Professional expensive work for free.

People who pay for images pay for indemnity those who take for free chance their arm.

marthamarks · « **Reply #20 on:** June 06, 2020, 11:05 »

Quote from: cobalt on June 05, 2020, 02:01

Plus we are ungrateful and unruly and cause shitstorms.

Very true!

Right now, it appears that AS is lying low, carefully keeping its head down and its mouth shut… hoping not to stir up this ungrateful and unruly crowd any more than we already are stirred up, and (especially) hoping not to bring any shitstorms down on its own head.

The only commercial stock site that's acting like a hero right now is DT. We'll see how long that lasts.

rinderart · « **Reply #21 on:** June 06, 2020, 11:12 »

Quote from: cobalt on June 06, 2020, 03:09

Quote from: tätarätä on June 06, 2020, 02:46
There is an oversupply of microstock images and also an oversupply on free images.

But there is no oversupply of really relevant content. All agencies are screaming for modern, loclaized, fresh work with high production value.

But at 10 cents, it cannot be produced.

Free sites have an endless stream of sunsets etc...nobody pays models, rents a location and then puts the work on free sites.

AGREE!!!!!!

Jo Ann Snover · « **Reply #22 on:** June 06, 2020, 11:48 »

Quote from: Chichikov on June 06, 2020, 02:26

Quote from: Jo Ann Snover on June 05, 2020, 18:22
Quote from: Pixart on June 05, 2020, 15:07
...On about June 2/3, it became apparent that content was declining faster than it was increasing. Possibly for the first time since SS came into business (This is an assumption, not an investigated fact)

I've been keeping track since the evening of June 2nd. Since then they've lost 1.7 million images (add to that whatever the uploads are which I have no insight into). They are dropping the number day by day that they say they are adding - it was 171,000 a day and now they say 160,400 a day

Numbers remaining 4pm June 5th and the change since 5pm June 2nd. Note that there is some overlap between illustrations and vectors, so the numbers don't add up

Photos
212,156,701   -1,322,077

Illustrations
111,156,382   - 510,107

Vector
69,675,150   - 302,972

All
324,066,312   -1,720,141

Jo Ann, I don't see any video in your report.
I think a lot of the videos are also disappearing from their servers.
It would be interesting to know how many.

Videos are disappearing, but I haven't been tracking them as I don't sell video

There is a guy who has started collecting data via a bot and has posted the results in the Facebook group Jake Sorenson started. He was tracking just the total, but I asked him about tracking individual content types - because I'd seen some odd times where all the individual types showed a decrease but the total (as shown by shutterstock when you selected "All images") was unchanged.

Here are his numbers yesterday evening

==> footage <==
Fri Jun 5 04:00 CEST 2020 : 18788305
Fri Jun 5 06:00 CEST 2020 : 18789157
Fri Jun 5 08:00 CEST 2020 : 18780447
Fri Jun 5 10:00 CEST 2020 : 18775951
Fri Jun 5 12:00 CEST 2020 : 18774347
Fri Jun 5 14:00 CEST 2020 : 18774296
Fri Jun 5 16:00 CEST 2020 : 18775593
Fri Jun 5 18:00 CEST 2020 : 18776547
Fri Jun 5 20:00 CEST 2020 : 18777780
Fri Jun 5 22:00 CEST 2020 : 18778295
Sat Jun 6 00:00 CEST 2020 : 18779293
SUM: -9012

So there were 9,012 videos gone in a day

H2O · « **Reply #23 on:** June 06, 2020, 13:08 »

Give it time and all the good content will be deleted.

I have, just like others been tracking the numbers and they are losing hundreds of thousands a day, in three days over a million and a half overall.

I'm not sure how many they get in new images a day but even with these they are going down quick, looking at the new uploads they are 99% utter rubbish.

A rough calculation by the end of the month they will have lost 15 million images, probably more taking into account all the uploads of rubbish they are getting.

If they lose 30 million in a month or so, those images will all be heavy hitting content, it is the talent moving out, no matter what they do, no stock site can sustain these losses, this along with no new quality means Shutterstock is finished.

Of course Pavlovsky won't bother, as he is just a bean counter, not knowing the difference between great and rubbish, only towards the end of the year and subscriptions are not renewed and the buyers stop buying will it become apparent, that he is about to be fired, by then no one will go back.

Mantis · « **Reply #24 on:** June 06, 2020, 15:01 »

I think FCC we will see another flood of deactivations after the June payout. THAT’s when those contributors who aren’t on social media and who really don’t bother to read the emails will know something is up.

What would be fun is if Leaf can post how many new MSG sign ups there were when the email came out and then since June 1. That would give us a small taste of what week one in July might look like.

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Author Topic: What does Shutterstock really want? (Read 5515 times)

Chichikov

cobalt

cobalt

MicroVet

cobalt

Stockmaan

Canonbabe

thestuckpixel

cobalt

Allsa

Mrblues101

Pixart

H2O

Pixart

Jo Ann Snover

Chichikov

tätarätä

cobalt

tätarätä

obj owl

marthamarks

rinderart

Jo Ann Snover

H2O

Mantis

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