By: Daryl Lang/PDN Online
What are they pouring in the coffee in Seattle?
Two separate announcements Thursday reveal that Getty Images is on its biggest shopping spree ever. The number 1 photo agency has sealed a deal to acquire the parent company of WireImage and is in talks to buy a major rival stock agency, Jupiterimages.
The two acquisitions — a confirmed $202 million deal to buy MediaVast and a possible $400-million-plus deal to buy Jupitermedia — would consolidate thousands of employees and dozens of brands under one corporate umbrella.
The swelling size of Getty Images stands to raise the company’s — and photography’s — profile in the media landscape. It could create the first imaging company with $1 billion in annual revenue. But it stands to make a tough business climate even harsher for Getty’s competitors, including Corbis and dozens of small stock and entertainment agencies.
For photographers, the deals mean more power in the hands of company that some love to hate for its aggressive business practices, but which has a reputation for cultivating excellent photography and award-winning photographers.
Getty’s purchase of MediaVast, best known for its entertainment photo services, was a closely kept secret until Thursday.
A statement issued by Getty Images says Getty will continue to operate MediaVast’s three brands: WireImage, FilmMagic and Contour. The companies offered no other information on how Getty will manage MediaVast, thought the statement said WireImage’s founding photographers and key executives have signed long-term agreements to remain with WireImage and Getty.
“We’re in the waiting period right now,” says Marc Kurschner, MediaVast’s senior vice president for sales and operations. Getty’s integration plan will become clearer in the next 30 or 45 days, he says.
MediaVast competes with Getty in several areas, including entertainment and sports wire services, celebrity portraiture and commercial contracts with sports leagues.
A second deal, rumor of which leaked in Wednesday’s New York Post, would lead to Getty Images acquiring the Jupiterimages division of Jupitermedia.
In response to a surge in its stock price, Jupitermedia issued a statement Thursday to acknowledge that it is in advanced talks with Getty and to challenge some facts that were in the Post story. The Post reported Jupitermedia was for sale for $11 a share, and the report drove the company’s stock price up Wednesday. Jupiter’s statement said the asking price was in fact $9.60 a share, sending the stock price back down Thursday. Based on the number of outstanding shares and Jupiter’s debt, Getty could pay $406 million for the company.
Most of Jupitermedia’s business consists of stock photos licensed through various Jupiterimages brands. The company also operates several Web sites and trade shows for IT professionals under the brand JupiterWeb. The Jupitermedia statement said Getty does not want to acquire JupiterWeb. Current Jupitermedia CEO Alan Meckler has expressed an interest in buying JupiterWeb as part of the transaction, the statement said.
Unsurprisingly, the Jupiter statement offered no predictions as to how Getty might manage the integration of the two companies, or what it will mean for contributors and employees.
These deals are bad news for companies that compete directly with Getty. Corbis is the second-biggest U.S. stock photo agency and has struggled to become profitable. Its stock photo division competes with both Getty and Jupitermedia, and the Corbis Outline celebrity portraiture service competes with MediaVast’s Contour Photos and Exclusive by Getty Images.
On the editorial side, Getty and WireImage are both leaders in sports and entertainment coverage. Together, the companies will have exclusive deals with almost all major American sports leagues. Key competitors include the Associated Press cooperative, Reuters and its Action Images sports division, and dozens of small entertainment and photojournalism agencies.