Of Music and RR Video . . .
Stock Asylum Staff Report
June 20, 2007
Getty Images announced on this date that it has acquired Pump Audio
for $42 million. The purchase marks Getty's first significant foray
into the stock music marketplace. In another matter, the stock photography
distributor has started marketing a new "rights-ready" footage
product.
Getty Images said it will expand its new music offering from Pump Audio to provide "incremental revenue opportunities for major labels and publishers and other owners of high-quality audio content."
Until now, Pump Audio has licensed mostly "indie" music from largely unknown musicians and songwriters. According to a Wall Street Journal report this morning, Pump has about 100,000 songs in its collection and generates some 80,000 sales a year, some to major clients like NBC and Mercedes Benz.
The acquisition appears to be a part of a larger strategy by Getty Images to move beyond the company's core offer of commercial still stock photography. Growth in sales from Getty's commercial still collections has slowed during recent quarters.
Earlier this spring, Getty purchased the parent company of WireImage, which supplies a large percentage of the entertainment and celebrity photography used in editorial markets. Getty also has been promoting its general editorial business and other services.
Getty CEO Jonathan Klein recently told an investors conference that Getty will use excess cash for more acquisitions rather than for dividends. He contended that the company has been very successful in growing through acquisition.
The company also has been building an increasingly robust collection of video clips. And, though there has been no official announcement, the Getty Web site has started promoting a new "rights-ready" motion product. The motion product is similar to the company's rights-ready still image offer, which provides imagery under a simplified licensing system.
For footage, there are six distinct usage options under the commercial usage category. Prices for commercial uses of one clip ranged from $850 for limited advertising distribution to $2,750 for unlimited advertising distribution.
In three editorial categories, prices for using the same image ranged from $175 for web sites, mobile devices and e-mails, to $750 for a documentary or editorial film. Internal company uses were quoted at $450 while comping uses were quoted at $150.
The rights-ready video collection includes footage from AP Archive, Archive Films, dick clark productions, inc., Discovery Footage Source, Image Bank Film, Universal Studios, Warner Bros. Entertainment and WireImage Video.
Getty Images said music will eventually be integrated into various web sites operated by the company. Getty recently changed its longstanding single web site policy and now hosts several sites that licence imagery.
Besides Gettyimages.com, the company now operates the iStockphoto micropayment web site, the WireImage web site and the PunchStock web site. The company has also said it will launch a consumer web site, but has not provided details.
Punchstock, with a large royalty-free still image collection aggregated from a number of sources, is for price-conscious commercial and editorial buyers.
In addition to the Pump Audio acquisition, Getty recently revealed in a Securities and Exchange Commission filing that it will acquire from Bruce Livingstone a music web site called Paper Thin Walls for $850,000. Livingstone is a Getty executive and former owner of iStockphoto.
Paper Thin Walls appears to be a site that reviews music. It is not clear how Paper Thin Walls fits into Getty's plans.
In purchasing a music archive, Getty is following the lead of JupiterImages, which already owns several music collections, along with flash animation and video archives. Jupiter, however, tends to target the low end of the market while much of Getty's collection is aimed at high-end buyers.
The Getty Images web site is at: http://www.gettyimages.com.
The Pump Audio site is at: http://www.pumpaudio.com.
