I was interested in the stuff that Robert Scoble and Thomas Hawk have posted about meeting with Getty Images, the giant stock photography company, but not necessarily because I’m all that interested in photography (although I am). The interesting thing for me is how Getty — like a lot of other companies in different industries — is trying to find a way of transitioning its business from one model to another, effectively cannibalizing itself before others can do it.
Scoble mentions how people such as Thomas (or whatever his real name is) and services such as Flickr and Zooomr are a threat to Getty, and they are — although not so immediate a threat that you can draw a direct line between the disappointing financial results the company reported and the rise of consumer photo-sharing sites. And Getty essentially tried to build a bridge between its old business and a new one by acquiring Calgary-based iStockphoto, one of the largest Web-based stock photo services out there (it recently added video as well).
Getty’s business, like that of competitor Corbis (owned by Bill Gates) consists mostly of high-quality, hard-to-come-by photos of celebrities and events, used in glossy, high-quality magazines, and for those the company gets paid anywhere from hundreds to thousands of dollars, depending on use. iStockphoto.com, by contrast, sells photos for as little as $1. And it does big business with small and medium-sized publications, Web sites and so on, with photos for $10 or $50 or $100.
In effect, Getty is hoping that owning iStockphoto can expand its business rapidly enough that it can counterbalance the decline in those hundred or thousand-dollar photo jobs, and prevent the recent financial pressure from becoming a sustained downturn. Other companies will have to find ways of doing the same in their industries, as James Robertson points out.