As images generated by Artificial Intelligence multiply and more than 5 billion photos are produced every day, licensed image banks are losing ground. Getty Images announced plans to acquire Shutterstock for around $1 billion, according to Reuters calculations. After the announcement, shares of Getty and Shutterstock jumped 46% and 24%, respectively, after years of decline. The agreement must still obtain approval from Shutterstock shareholders and especially from public anti-trust authorities in the United States and Europe.
The turnover of the new entity called Getty Images Holdings is approaching $2 billion. The planned economies of scale would reduce costs by around $200 million, according to Reuters. Getty shareholders are expected to own 54.7% of the new entity while Shutterstock shareholders would own the remainder.
Founded in 1995 by Mark Getty and Jonathan Klein, Getty Images is the leading provider of images (photos and videos) to advertising agencies and media outlets. It was sold in 2012 to the Carlyle group for $3.3 billion (3.2 billion euros) then bought by the Getty family in 2018. Shutterstock is an American platform founded in 2003 by Jon Oringer and specialized in distribution digital content.
Getty Images Holdings will be led by Craig Peters, the current chief executive of Getty Images. A board of directors led by Mark Getty will be made up of 11 people, including current Shutterstock CEO Paul Hennessy. We will “meeting the evolving needs of the creative, media and advertising industries through combined investments in content creation, event coverage and product and technology innovation” said Getty Images.
Faced with the rise of AI tools like Midjourney and Dall-E, which generate sometimes hyperrealistic images, the sector is under pressure. Getty Images tried to fight back by offering the ability to generate AI images from its photo library and pledged to pay the artists whose photos were used.
The Getty / Shutterstock merger, however, is not unanimous. “In my opinion, any merger inevitably means that photographers will suffer. This merger results in a monopoly”photojournalist Yunghi Kim told Artnews. “Getty has always aimed to monopolize the image market”. The main competitors of Getty Image and Shutterstock are Reuters, Associated Press, AFP, Adobe Stock and Alamy.