Getty Images and Shutterstock, two of the biggest players in the licensed visual content industry, announced Tuesday a merger that will create a $3.7 billion company tailored for the challenges of the artificial intelligence era.
Getty Images and Shutterstock Merge PHOTO: facebook/Getty Images
The two companies are counting on the fact that this combination will help them reduce costs and grow their businesses by generating new revenue opportunities, at a time when the increasing use of generative artificial intelligence tools, such as Midjourney, is a threat to the industry, writes news.ro.
Shutterstock shareholders can choose to receive either $28.80 per share in cash, 13.67 Getty shares, or a combination of 9.17 Getty shares and $9.50 in cash for each Shutterstock share they own. The value of the transaction exceeds 1 billion dollars, according to Reuters calculations.
Shutterstock’s shares rose 22.7%, and Getty’s rose 39.7%. Both companies have seen their shares decline over the past four years amid the growing use of mobile cameras, which has reduced demand for stock photography.
Getty CEO Craig Peters will lead the combined company, which will have annual revenues of nearly $2 billion. The company will benefit from Getty’s extensive library of visual content and the strong community on the Shutterstock platform.
Peters downplayed the impact of AI, saying he was confident the merger would win approval from antitrust authorities in the US and Europe.
“We don’t control the approval schedule, but we have a lot of confidence. This was a situation where customers always had options”Peters said.
Analysts say President-elect Donald Trump’s recent appointments to the Justice Department signal a continuation of tight oversight by the antitrust division.
“With Gail Slater at the helm, the antitrust division will be much more aggressive under this Trump administration than in his first term”commented John Newman, a law professor at the University of Miami.
Regulators will look at the impact of the merger on both the traditional model of selling images for traditional media and the new model of offering copyright-compliant generative AI applications.
The merger is expected to generate cost savings of up to $200 million over three years. Getty shareholders will own approximately 54.7% of the combined company, and Shutterstock shareholders the rest.
Getty competes with Reuters and the Associated Press in providing photos and videos for editorial use.
