Nice piece. In the last couple years the media has focused on web 2.0 companies and applications- many new social networking sites look at the success of a YouTube and get stars in their eyes. Quick success stories are rare- even seasoned entrepreneurs will tell you luck was on their side.
Building a successful business takes time. iStockphoto focused on growing a community of passionate people. In 'Internet time' seven years seems like ages. New internet start-ups need to understand that business fundamentals still apply. Good relationships, solid revenue, energetic community and a strong leader- now that is web 2.0!
An Exclusive Digital Markets Blog "Real Deal" CEO Interview: Bruce Livingstone, Founder, President and CEO, iStockphoto.
Got $1.00? Then you can download one of 1,459,000 artist quality, royalty-free images showcased at iStockphoto.
Bruce Livingstone, iStockphoto President and CEO, has been powering “the first, biggest and best community-powered marketplace for value-priced imagery,” since he founded it in April 2000.
As of February 2006, Livingstone has been powering his photographic phenomenon on behalf of Getty Images, “the world’s leading creator and distributor of visual content.”
Getty Images acquired the Canadian firm iStockphoto for $50 million to “embrace the power of the culture of participation that is sweeping the Web” while supporting a Getty strategy of “serving image buyers at all price points on all platforms and in all markets.”
Livingstone said of the Getty purchase of iStockphoto at the time: “We took a look at where we wanted to go and found Getty Images singularly capable of helping us get there.”
As iStockphoto celebrates its one anniversary within the Getty Images family, Bruce Livingstone sojourned from Canada to New York City last week and I joined him over lunch to discuss iStockphoto, past, present and future.
Livingstone on the “The Story of iStockphoto.com”:
iStockphoto.com was founded in May 2000, but the groundwork was laid in 1999 with Frequency Labs Inc., my first attempt at launching a stock photography publishing company. As a boutique studio, Frequency Labs produced and retailed 4 CD-Roms, (which can still be found in the iStock web store). I decided to give away all 1600 or so images from the CD-Roms on a web site. As an independent stock photographer I wanted to re-invent the traditional model of stock photography sales. I worked off some ideas I had when I worked at Image Club Graphics from 1994-1996. The commerce model was loosely based on an arcade, micropayments with mechanisms for contribution and accessibility. On April 7, 2000, iStockphoto was born. Today, iStockphoto is the world's fastest growing collection of original, independent, royalty-free images.
The success of iStockphoto has its roots in Livingstone’s business model based entrepreneurial development process. Nevertheless, Livingstone is not shy in offering a Web 2.0 start-up on a shoestring tale, he proudly told me the iStockphoto domain name was acquired for $25.
Despite the $25 URL frugality, Livingstone could not avoid the high costs of professionally operating a photography hosting business.
Livingstone told me he founded iStockphoto as a “community” for photographers. Livingstone embraced the notion of online community long before it became a buzzword and he operates iStockphoto as a real community to this day.
Livingstone’s photography-based community was originally based on a iStockphoto “trading” model with photographers trading digital photos amongst themselves. When Livingstone received a $10,000 Web hosting bill from his ISP, however, he replaced the iStockphoto “credits” trading currency with real currency in order to fund iStockphoto infrastructure.
When iStockphoto began charging users for photography downloads, it created the first online microstock business, Livingstone told me. Very micro-payment, in fact: iStockphoto initially charged 25cents per photo, with 5cents earmarked for the photographer.
Seven years later, the price of artist-quality images at iStockphoto has quadrupled to reach a rock-bottom download price of $1 up, photographer cuts range from 20% to 40%.
Livingstone came to NYC last week to join fellow iStockers at the “PLUG Independent Music Awards,” a “collection of music lovers, writers, DJs, bloggers, artists, filmmakers, managers, indie retailers, and most importantly fans, who gather together each year to celebrate the artists who live and flourish in the margins.”
Artist members that are part of the iStockphoto community, however, may shine beyond “the margins.” Livingstone boasts iStockphoto, “the official photographers” at the PLUG Independent Music Awards in NYC 2007:
Like iStock, PLUG is about the independent artist community coming together to recognize their own. We figure this will be the perfect opportunity for our exclusive diamond members to get a head start on some editorial content for Getty.
The iStockphoto “Diamond” photographer program represents the iStockphoto-Getty collaboration win-win-win opportunities available for dedicated photographers consistently contributing high-quality photos to iStockphoto.
“Diamond” level iStockphoto contributors have achieved the 25,000 downloads milestone and are rewarded with the privilege of submitting up to five images a month to Getty for additional exposure and increased remuneration.
iStockphoto’s “Diamond” recognition for top contributors is but one of the ways its one-of-a-kind community of photographers is groomed to the benefit of all constituents: photographers, customers, iStockphoto, Getty and the photography world at large.
What it takes to be part of the iStockphoto photographer community:
Anyone can apply to become a photographer on iStockphoto. Contributors will be asked to read through our online training manual which is found by clicking the “Upload” link. Once that’s complete, you will need to answer a few questions and then upload a piece of government issued identification in the form of a JPEG. We require this to confirm who you are and that you’re of legal age. Finally, you will be asked to submit 3 sample images which will be reviewed by our inspection team. We will notify you of our decision via email or you may review the status of your application by clicking the “Upload” link again.
Sound familiar? Probably not. iStockphoto is NOT YouTube.
In stark contrast with the video upload free-for-all encouraged at YouTube, iStockphoto provides a professionally controlled photography upload environment which results in a vast collection of high quality and non copyright infringing works, available for purchase at the consumer friendly price of $1.
iStockphoto employs a 73 person strong worldwide team of image inspectors:
Each image is checked individually by one of our Approval Administrators for various requirements such as size, file type, quality and copyright. This means that every image in the library has been downloaded, viewed at full size, checked exhaustively and qualitatively evaluated by at least one, but sometimes two or more Approval Inspectors.
Result? iStockphoto stats:
35,000 photographer contributors
150,000 images uploaded monthly
50% of image uploads are accepted
iStockphoto has recently expanded into the video arena and currently features the work of several hundred videographers. Video downloads are priced from $5 up.
Traction? iStockphoto stats:
180,000-200,000 unique visitors a day
About 4 million page views a day.Data served: 1.5-2 terabytes a day
Downloads: An image or video is downloaded somewhere every 3 seconds.
How does iStockphoto attract such high levels of usage, from both photographers and consumers?
Livingstone told me iStockphoto’s “explosive” growth in the past year is due in great part to the goodwill generated from its acquisition by Getty Images. Getty support is now helping fuel iStockphoto’s international expansion.
Livingstone is proud of the iStockphoto localized sites in French, German and Spanish. Following his NYC visit, he was enroute to Germany to meet with the German iStocker community.
What is next for iStockphoto, for Bruce Livingstone?
I asked Livingstone if he retained any equity in iStockphoto upon its sale to Getty Images. Livingstone told me he does not currently hold any stock.
As conventional buyout wisdom suggests founding management needs equity involvement to fuel continued operating passion, I asked Livingstone what motivates him to stay at iStockphoto, what drives his continued iStockphoto passion?
Livingstone is innately proud of his contribution to the world of digital imagery via the iStockphoto phenomenon that he created. He is confident the Getty-iStockphoto collaboration has many more fruits to bear and wishes to help harvest them personally.
Getty has provided its “controlled vocabulary” assets to iStockphoto and Livingstone looks forward to significant improvements in image search and retrieval.
I asked Livingstone if he is not impatient to bite the entrepreneurial start-up bullet once more.
Livingstone underscored to me his passion for continuing to shepherd iStockphoto innovation, he also acknowledged he has a few exciting ideas perculating.
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