Getty and Shutterstock Plan Merger to Combat AI
Getty Images, a prominent name in the stock image industry, is reportedly considering a merger with its competitor, Shutterstock. The news sent shares of both companies surging during Friday afternoon trading. Getty's stock rose by 20.3%, while Shutterstock's shares climbed by 7.7%.
Declining Fortunes in a Changing Industry
This development comes as Getty Images faces significant challenges in retaining and replacing its customer base. The company reported declines in its creative and editorial products—two key revenue streams—in its 2023 annual report. These struggles highlight broader shifts in the stock image market, which has been disrupted by the rise of AI-powered tools like Midjourney and DALL-E 2. These technologies offer users the ability to generate custom images quickly and at a fraction of the cost of traditional stock photos.
A Potential Game-Changer
If the merger proceeds, it could create a powerhouse in the stock image sector by combining two of the largest U.S. providers of licensed visual content. Based in Seattle, Washington, Getty Images was founded in 1995 and has built a global reputation through brands such as Getty Images, iStock, and Unsplash. Despite its extensive network of over 70 exclusive content partners—including AFP, Walt Disney, BBC Studios, FIFA, Formula One, and the NBA—Getty's stock has suffered, losing nearly 59% of its value in the past year.
Shutterstock, headquartered in New York, is another major player in the industry. It boasts a diverse portfolio that includes 3D models, videos, music, photographs, vectors, and illustrations. The company further expanded its offerings by acquiring Giphy in 2023.
Strategic Considerations
Getty is exploring how to structure the potential merger to unite the companies effectively. However, deliberations are still in the early stages, and there is no guarantee that a deal will materialize. Neither Getty Images nor Shutterstock has commented on the report as of now.
The Road Ahead
This potential merger reflects the shifting dynamics of the visual content market, as traditional providers face mounting competition from AI-driven solutions. By pooling resources and capabilities, Getty and Shutterstock could position themselves to better compete in an industry undergoing rapid technological transformation. However, it remains to be seen whether such a deal will come to fruition and how it might reshape the landscape of licensed visual content.
As deliberations continue, stakeholders in the creative and media industries will be watching closely to see how this potential merger unfolds.
