Saturday, November 1, 2008

From Bad to Better - Likely Acquisition of DRR Assets By Newscom A Good Thing

There were just a few outcomes for what remains of Digital Railroad, or so I thought. One was closing it's doors, another, being acquired by PhotoShelter, then there was potential suitor liveBooks, Mark Ippolito, and then the never-was-gonna-happen Getty and Corbis.

What hadn't crossed my radar was Newscom, when rumor spread Thursday evening of a company with cash to buy the assets. A number of people got calls from me, including several at Diablo Management. I wrote in an e-mail to them :"I have heard that Digital Railroad was acquired this evening in a cash transaction, and I would like, at the very least, to know if you can confirm that." The response I received Friday morning, first thing, was "No comment regarding your assertion. We will however have some news later in the day."

When they wrote in their statement, describing the suitor, but strangely, not naming them, I pondered who fit that bill. Daryl Lang, over at PDN had the only viable name to fit that bill (Is Newscom about to aquire Digital Railroad Assets?, 10/31/08), and I have to agree with him.

So, what exactly does this mean?

(Continued after the Jump)

Like the Phoenix rising from the ashes, this is a good thing. No, let me get that right, this could be a great thing. This entire piece will be a dissection of the problems that the other suitors likely would have had, and how Newscom is great for everybody, save one.

First to PhotoShelter. The only real reason PhotoShelter would have benefited from the aquisition would be because they could have used the aquisition to get 1,400+ new active photographers. To date, several hundred have already made the switch. However, the demands by WTI for a price-point made that deals' value minimal, at best. Further though, PhotoShelter wasn't really focused on agencies to use ther platform (although they have the capability to take them, if they wanted to). So, for PS, it was all about new members.

Next to liveBooks. LiveBooks could have used the technology as an add-on to their current capabilities, but the question first was of valuation and then of integration. Following that was the concern about the debts that were outstanding. There was the $1m to WTI, then right around $80k to another lender, and then $120k or so owed to photographers, and taking on those debts made this deal unpalatable, for sure.

Next to Ippolito. Mark would have been a good fit, except that people would have been leary that he could keep it going, and they would associate him with the unexpected failing that just happened, and lastly, he likely had a hard time coming up with the money that Diablo/WTI wanted.

Getty and Corbis already have platforms they are happy with, and for them, it was likely a question of acquiring several million more images, but then again what to do with all the agency deals that were there. So they too, not a good fit.

Then, the morning of October 30th, Newscom sent out this missive:

Dear Former Digital Railroad Customer:

With the unexpected closing of the Digital Railroad business, Newscom and Mainstream Data have been receiving many calls from photo agencies and professionals like yourselves asking if there is anything we can do to help them – and do it quickly. The answer is Yes!

Mainstream provides premier hosting and distribution services, software development, and web platforms for prominent photo agencies including Thomson Reuters, Bloomberg, the European Pressphoto Agency, the German Press Agency (DPA), the Dutch Press Agency (ANP), the Spanish Press Agency (EFE), the Portuguese Press Agency (Lusa), UPI, and many photo plus video agencies like Splash News, AdMedia, Featureflash, Sipa Press, Ace Pictures, INF, and Jupiterimages. Moreover, unlike some of the other companies offering refuge for Digital Railroad customers, Newscom and Mainstream have been key players in this business for more than twenty years, are profitable, and offer you the security and functionality you need to be successful and to be able to sleep at night.

We provide both Internet FTP push delivery and hosted web portals for delivery of your photographs to subscribers, and we also operate the largest multi-agency marketplace for digital media in the world (Newscom).

Our managed FTP service is called MediasFTP; it is our automated FTP distribution system that reads the IPTC data out of your photographs, categorizes the photos for delivery to groups of users, and then simultaneously delivers the photos to your partners, customers, and agents at very high speeds. Our customers for this service include Sipa Press, AdMedia, Featureflash, Ace Pictures, and Splash News; they use this system to insure that their photos arrive first at their customers, for, as you know, speed is everything these days!

To replace the hosted photo website that Digital Railroad has provided, we also offer what we call, ‘Newscom Minisites’, using the same technology that more than 5,000 newspapers, magazines, broadcasters, and web sites depend upon every day to license images for their publications. You may already be familiar with Newscom as the one-stop digital media marketplace where users have instant access to almost 25 million rights-managed and royalty-free photos, graphics, illustrations, news stories, and features created by the world’s foremost publishers.
What you likely didn’t know was that more than 150 content providers use Newscom to reach a secondary market for sale of their content. Newscom is the digital media marketplace of the future—today.

A Newscom Minisite provides functionality similar to the Digital Railroad web portal in that we provide your customers password protected access to your photo archive where they can search, browse, and download photos and other multimedia content. We can also provide some customization of the front page of your Minisite by using your logo and contact information.

We would love to tell you more about our services and show you a demonstration, including a WebEx Internet broadcast in the next few days for those who have interest.

Don’t jump out of the Digital Railroad frying pan only to find yourself in the fire because you have chosen yet another unstable vendor.

To find out more about how Newscom and Mainstream can help, please send us an email at Alternatively, please feel free to call one of us at the numbers provided below:

North and South America and Asia

Greg Weeks
Vice President, Mainstream Media Services
u.s.a. | work: +1.801.584.3989 | mobile: +1.801.915.2768

Bill Creighton
Managing Director, Newscom
u.s.a. | mobile: +1.703.850.5711
Europe, Middle East, and Africa

Richard Buckler
European Sales Director
u.k. | work: +44.1293.561120 | mobile: +44.7711.717935

Thanks, and we look forward to hearing from you.

Kind regards,

Your Friends at Newscom and Mainstream

While that's a nice offer, and one worth considering, it defines in very clear terms what Newscom is, and does. I can tell you that I have an account with Newscom, and I use it on a fairly regular basis, and it has generated revenue for me, and I think highly of its' services.

You may not be familiar with them, but you're familiar with Knight-Ridder, and Tribune Media? This press release informs you about just where their foundations lay and that were, in fact, a joint venture of Knight-Ridder and Tribune, before being sold to Mainstream Data last Summer. That's pretty solid backing, to be certain. So, when I learned of this possible outcome, I began to think about all of the good things to come of it. Let me walk you through a few of them:

1) I think the biggest benefit is that Newscom is a conduit for countless other image providers. Getty, UPI, AFP, Black Star, and many others have images that flow through their image pipeline. If you want to go check things out, visit:, and click the "Login" link. NewsCom allows anybody to browse their images as a guest, (login: NCFOTONA, Password: Guest) and they provide the login information to do so without having to sign up. A search for "Palin" yields images from many sources, including, yes, AFP and Getty. In fact, check this link (once you're logged in), to see their partner sources, and above, right, you can see that I am listed, alphabetically right above Jupiter Images.

2) In addition, much of NewsCom is "push" technology. What that means is that those images are in browsers at newspapers and other content users, at their fingertips. To them, a search on their desktop is as if they are searching their own computer's hard drive, with instant results, and instant download/usability. Previously, DRR's Marketplace would only get a sale if someone knew about DRR, and navigated themselves to DRR, set up an account, and then began their search - that's more like "pull" technology.

3) NewsCom has a wide collection of images, just as Getty/etc does. Sporting events of all types, celebrity events, portraiture, and so forth. They have a fat pipeline of a wide variety of images, and they have numerous sources for those images. While they are seen as predominantly news, they have creative (i.e. non-editorial) images, as well as graphics, illustrations, cartoons, and so forth. Look around the publications you have nearby you right now - I'd bet that there is at-least one credit for NewsCom in it somewhere.

4) What NewsCom really doesn't have was the individual-photographer-archive capability that DRR has. Yes, NewsCom has their MiniSites, but the back-end and client services capabilities that the DRR architecture would offer would be great for them.

Ok, so that's all the good things - are there any bad? Well, it's not a bad thing, per se, but a question - what will the rate structures look like? I can say that my revenue from image licensing has been fair and reasonable, and I doubt that would change with the integration of the DRR platform and services, but it does remain to be seen what the rates will look like.

Additionally, it's clear that Newscom wants the architecture/intellectual property. It's unknown at this time was the final dissolution will be of the reported $120k in monies that are owed to photographers from images sold/licensed. I know that Stock Artists Alliance is on the case on this. That said, if Newscom is just looked at the assets, it's likely they won't take on the $120k owed photographers, but who knows. Perhaps there are images that were licensed, but the bills not paid, and Newscom may facilitate that final payment, if the balance due DRR/Newscom is still outstanding? We'll need to wait and see on this point.

Then, let's return to PhotoShelter. I think this is a potential problem for them. They closed the PhotoShelter Collection, and they have various degrees of image licensing available, and they use the FotoQuote pricing structure, modifiable by each photographer, to license images. Yet, you have to come to PhotoShelter to get the image - a form of "Pull" technology that requires the person needing the image to come to PhotoShelter. PhotoShelter's archives previously had a large number of sports images there, due in large part to the earlier partnership between them and SportsShooter, and the natural use of PhotoShelter by the large SportsShooter member community. While their image library has grown over the years, this puts them in a bit of a challenging position. Digital Railroad has a few features that PhotoShelter doesn't, but it suffered from a problematic user interface and client interface. PhotoShelter has a much more intuitive and easier to use interface, but is that enough of a value proposition to keep people?

Down the line, I think you will see a merger of both PhotoShelter and liveBooks, which will be a remarkable union for the photographer that is primarily an assignment photographer who has clients that need for an integrated website solution, client download capability, image licensing, and hardcopy prints. I don't expect NewsCom will get into the website business, and who knows about the ability to obtain an 8x10 of an image a client wants.

So, when will the NewsCom deal happen? It either will, or it won't, by mid-week, according to our sources. At this point, it's just a "Letter of Intent", and noting more. As a variation on what I wrote before - fasten your seatbelts, this is where the ride gets really interesting.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Thursday, October 30, 2008

PhotoShelter Steps In To Aid Digital Railroad Subscribers

Here is the official statement from PhotoShelter, regarding Digital Railroad:


Photographers & agencies to get more time to save their work

New York, NY, October 30, 2008 – In an effort to bring some clarity to the Digital Railroad shutdown situation, PhotoShelter CEO Allen Murabayashi has engaged in multiple discussions with Diablo Management on behalf of the community of over 1,500 Digital Railroad customers. The outcome of these discussions is an understanding that more time will be provided for Digital Railroad customers to access their work. The official statement from PhotoShelter and Diablo Management reads:
(Continued after the Jump)

“As part of the process of terminating the business operations of Digital Railroad, Diablo Management Group has informed PhotoShelter of their intent to shut down the DRR site as early as 11:59PM, PST, on Friday October 31. After this point, it is very likely that all the images located on the Digital Railroad servers could be permanently inaccessible. Given the strong possibility of this event, PhotoShelter, on its own initiative, is strongly suggesting that customers migrate their files from Digital Railroad immediately. Digital Railroad, at the present time, has no plans or resources to accomplish this task.”

Upon announcing the termination of operations on Tuesday, DRR stated it would provide only 24 hours of server access. Across the industry, this tiny window of time was deemed unacceptable. Although the extension through October 31 is brief, it will provide more time to help photographers find backup options and transition their online presence. This statement also represents the latest definitive information to be shared with impacted customers, directly from the group that is controlling DRR. Both parties stress that the situation is highly fluid and this deadline could be altered with little or no notice.

Since the announcement, PhotoShelter has welcomed DRR customers with a special 3-month free offer and ftp solution to help migrate their images. The offer can be found here:

PhotoShelter management encourages all DRR photographers to use this time extension to access their images and ensure backup using any chosen method. And, PhotoShelter calls on photographers industry wide to help contact peers travelling in the field who may not yet have heard the news.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Wednesday, October 29, 2008

One Solution for Digital Railroad Survivors

So, my good friends at liveBooks have got a great deal for you, and I'll just put the number out there, so as to not bury the lead:

25% off a liveBooks site if you survived Digital Railroad's demise and now need a web presence.

(Continued after the Jump)

You have until November 14th to take advantage of this deal. Previously, you had to be a member of a trade association to get a deal, and that maxxed out at 15%. liveBooks is NOT PhotoShelter, and PhotoShelter is the best solution for archiving, and image licensing/sales. For a website, liveBooks is a top notch solution.

“Many Digital Railroad clients have come to rely on their DRR archives as de facto websites, thanks to the ability to easily upload photo galleries and share high resolution images with clients,” said Andy Patrick, president and CEO of liveBooks. “With Digital Railroad recently ceasing operations, these photographers face the prospect of a substantial disruption in their client workflow, as well as the loss of potentially their only online presence. By extending this offer, we can help DRR clients create a professional, powerful web marketing presence that will enable them to sustain and build their businesses, and also maintain some continuity in their work with clients even in these difficult economic times.”

Of course they have a great website capability, but you can also produce galleries on the fly from a shoot that are password protected, and also deliver images via FTP. So, check them out. If you were looking for the best discount possible to make this happen, you've just found it.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Jill Greenberg - Still At Large?

Well, it seems that Fast Company is none-to-concerned about Jill Greenbergs' bad reputation (Jill Greenberg: Open Mouth, Insert Foot, 9/12/08) and has assigned her to photograph Family Guy creator Seth MacFarlane for their latest cover story.

It surely helps, that the opening paragraph of the article ( Seth MacFarlane’s $2 Billion Family Guy Empire, 11/08) describes MacFarlane's work - "Much of the animated sitcom's purpose seems to be to stoke the opposition, to offend the easily offended." So, perhaps they are two peas in a pod? Kindred souls?

(Continued after the Jump)

The online article includes other images Greenberg produced as well as her signature (and dare I say, now looking a bit passe) lighting style.

Perhaps, though, Greenberg shot this piece back before the controversy erupted? As we move forward in these interesting editorial times, it will be interesting to see if Greenberg remains "assignable." Certainly, if this was done after "the incident", MacFarlane surely has no problems with Greenberg, since 10 days ago, his Family Guy show had this suggestion that McCain/Palin supporters are Nazi's, with this in it:

If you'd like to see the video segment with that in it, click here.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Tuesday, October 28, 2008

Digital Railroad - Saving Your Facade

If you are looking to preserve your website's look and feel, in order to transfer to a place like liveBooks, or hire a designer, while your site is still up, go into Adobe's Acrobat Professional program.

Go to the "Advanced" drop-down menu, and choose "Web capture". Choose "create PDF from/Append web page...", and enter in your URL, and how many clicks in you want it to capture.

Good luck.

(Comments, if any, after the Jump)

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Digital Railroad - 24 Hours, and Counting to Shutdown

The front page of DRR says:

When you visit the Digital Railroad website, this is the message you get:


Digital Railroad Suspending Operations – Added Oct. 28, 2008

To our valued Members:

We're sorry to inform you that Digital Railroad (DRR) has shut down.

On October 15th we reported that the company had reduced its staff and was aggressively pursuing additional financing and/or a strategic partner. Unfortunately, those efforts were unsuccessful. Therefore Digital Railroad has been forced to suspend all operations.

Digital Railroad has attracted a loyal set of customers and partners, and we regret this unfortunate outcome. Without sufficient long-term financial support, the business had become unsustainable.

Thank you for allowing us to serve the photographic community these past few years.

All questions pertaining to claims should be addressed to:

Digital Railroad, Inc.
c/o Diablo Management Group
1452 N. Vasco Road, #301
Livermore, CA 94551

(Continued after the Jump)

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Monday, October 27, 2008

1,900 and Counting - The Digital Railroad Bloodletting

There are 1,900 or so of you out here that need to read this message. The rest of you can just ignore it. The problem is, those that need to know what I am writing about have buried their head in the sand. As I am writing this, my own migration from Digital Railroad to PhotoShelter is in progress. I am benefiting from under-utillization of the DRR bandwidth, but you will not, because the doorway you all will be trying to pass through is only so wide, and only so many people can fit through the door at the same time. Where are you in that line? How long do you have?

Ok, let's, for the sake of conversation, conclude that, for whatever reason, you don't want to go to PhotoShelter. THEN DON'T! But, you better have those files archived somewhere. And you better migrate any that you don't, FAST.

The NPPA sent out this alert to it's members, this morning:

In the past, the NPPA had a partnership with Digital Railroad offering our members a service discount. In light of the current news on Digital Railroad we recommend that if you are a Digital Railroad customer, you take action immediately to protect your work. In researching what is available, your three best options are to:
A) Personally back up all of your work stored at Digital Railroad

B) Take advantage of the deal PhotoShelter is offering DRR customers to migrate their data:

C) All of the above
For more information please see the Digital Railroad article the NPPA published, updated this morning, on NPPA.ORG:

Thank you for your time and consideration,

Jim Straight
Executive Director

Below is a step-by-step for you to begin the process, and remember, those that begin this process FIRST, will get the bandwidth necessary to save their files.
(Continued after the Jump)

I am going to do the step-by-step in PhotoShelter. Come on, don't get all uppity - everyone knows these two were the only comparable platforms, and both were competing for customers. So, there's really no other option, unless you're downloading to your own computer at home (and good luck with that.)
The first thing you need to do is set up a "receiving" folder on the PhotoShelter system. Click the "Archive" tab in the Photographer Area on PhotoShelter, as seen below.

Then choose "Create New Folder". Here, I've chosen the name "Digital Railroad Transfer". Might I suggest you create one folder to receive all "Private" groups, and one folder to receive all "Public" groups. If you have any "UnPublished" groups, so too, a separate folder for those too.
That done, next click on the "Upload" tab at the top, and you'll see something new - the "Incoming FTP" option.
Click that (1) and then choose (2) "Add a new incoming FTP user".
Next, you'll see this screen, below. It will have pre-populated the username (1) with something applicable to you, but you may change it to whatever you want. So too, will the password field (2) be prepopulated with a password. Again, feel free to change it to suit your needs. Take extra note of the (3) "Active" checkbox. You are only allowed to have ONE FTP account "active" at a time. As you set up more than one archive folder, you'll want a comparable number of FTP accounts setup, because different logins sent the photos to different destination folders on PS.

As noted, choose the destination folder (4) for this account.
As you can see below, we've got two accounts set up, one for the "Private" files, which go to the generic "Digital Railroad Transfer" folder, and one for all the "Public" images.
Next up you'll want to head to Digital Railroad. Log in, and on the left-hand side, choose the "Syndication Management" link, and choose "Create New FTP Destination".
Choose (1) your Destination Name, and in the "FTP Host" (2) enter "", and then (3) the user name you were given (or chose) from Digital Railroad, and so too (4) the password. Make sure you (5) check the "create new folder" checkbox, which will create sub-folders on PhotoShelter that are named what you have them named on Digital Railroad. Once you've done this, click (6) "Test", so that you know it worked. You'll confirm that the FTP test was successful when you see the line (7). Note that if there is an extra space in the FTP (2) field, you could have a problem, so check that if you get an error.
Next, go to your "My Site Production", and choose the group you are working on. I suggest you do as below, and "right-mouse-click" (or control-click if you have a one-button mouse) and open that link in a new window. By doing this, it's easy to keep track of where you are in the process, because with the new window open, you can begin the transfer, and then just close the window and move on to the next one.
Next, from the My Site Production menu, choose "Syndicate Group".
Your options to syndicate come up, and all you have to do is place a check in the "Transfer to PhotoShelter" destination (1), and click the Syndicate (2) button.
Once you've clicked the "Syndicate" button above, you will see the confirmation, as below. Click the "View Syndication Details" text, to see that the FTP is taking place.
The next screen you will see is the details of the syndication. You will see the progress, and if there are any errors. If you see an error, just click the "Retry" button, and it will restart. Where you see "PENDING" below, the other options are "SENDING", "ERROR", and "SENT". Use the "Refresh" button to watch the transfer take place.
If you look at the above screengrab, you will see that the text "syndication management" is clickable. When you click that, you see all of your transfers, not just the single one. Below you will see multiple transfers in progress, from my DRR archive to my PS archive. One thing to note - it was my experience that if you opened too many transfers at once, there was an error in the transfer, and it stopped, and further, did not attempt to re-start. When there is this kind of error, you will see a red number in the "Error" column. Just click the individual group in progress, and then click the "Retry" button.

That's it. Sit back, watch for errors, and retry where necessary with a right-mouse (cntrl) click and open a new window to retry.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

The Second Mouse Gets The Cheese - Who Will Acquire Digital Railroad Assets?

It looks like the VC's that bought into the Orient Express that was Digital Railroad have a bit of a problem on their hands, snapped in half by the mousetrap spring they didn't see coming to crush them. In an effort to stem the burn-rate of what rose at points to be $800k a month, they took out a loan with a bank of upwards of $1M. The problem is, with a burn rate that high, that was a stop-gap solution that did not include the reining on of expenses, or atleast ones that never materialized. What is remarkable too, is that a startup was willing to pay reportedly between $400k and $500k for it's CEO, Charles Mauzy. While there are suggestions to the contrary where we detailed a similar pay structure for it's President, Maris Berens, a review of further documentation shows his salary at approximately $136k, and then under $125k after he took a pay cut as a part of belt-tightening at DRR. What startup pays that amount of money to a CEO? Certainly, both had a track record and contacts that were worth that, but that's bad form for a startup to pay that figure. What's not a part of the reporting of those salaries is what they had as an added equity stake that is now worth less than the paper it was printed on. There is speculation that the development of the DRR platform on an entirely Microsoft solution, coupled with bringing in Mauzy, a Microsoft veteran, was positioning them for an acquisition by Microsoft (and hopefully a big payday), but that never materialized.

One of the messages I overheard several times in the booth at liveBooks, where I spoke for an hour each day during the just-concluded PhotoPlus Expo was how much people wanted an integrated solution not just to facilitate an attractive facade in the form of a website, but to also be able to serve their clients with image delivery, and a licensing vehicle. For over two years, both liveBooks and PhotoShelter have been in talks to have at-least some form of bridge between the two, and it may be that there were also merger talks and the past two years have been just the courting phase. The fact is that you can get a great design integration between liveBooks and Photoshelter today, and if this all goes south maybe more will develop. However, for now however nothing more than visual integration exists.

(Continued after the Jump)

Months ago, the VC's of Digital Railroad were shopping around the platform, but too much in the way of expectations for what they would get for the sale, as well as a number of unreasonable (relatively speaking) demands were made, and they failed to realize that the clock was ticking, and ticking fast.

As we reported last week (Digital Railroad Likely Being Liquidated, 10/15/08), DRR is likely being liquidated. Every member of the board has, in fact, resigned, and the company is controlled by Diablo Management, with a few of the former senior management or officers remaining on as just employees, with no official officer roles. Yet, that changes today, Monday October 26th. With a negative balance in the bank account, there is no more money, we are told that all staff were sent an e-mail from Diablo telling them not to report to work today. Yet, Andy Parsons, and a few other senior staff apparently will stay on, through the week, as volunteers, without pay. What a new month brings, remains to be seen. Absent the spigot being opened at PhotoShelter to receive FTP'd files as we'd provided advance how-to on, approximately 1% of the 2,300 DRR photographers have either cancelled their accounts, or migrated their files off of the DRR platform. It seems that everyone that is a paying member there is in denial about the realities of the dire situation DRR is in. Just like, the clients have been asking what they can do to help this ship from sinking.

DRR has just two options - file for bankruptcy, or get acquired at firesale rates. The decent rate on this nosedive is just too severe. There are just a few possible players for the company at this time - PhotoShelter, former senior management member Mark Ippolito, and, PictureMaxx. Perhaps too, this could be of value to liveBooks.

Surely, the opportunity to pick up this platform at a firesale rate is attractive. However, PhotoShelter doesn't need it since they have, what is in effect, certainly a better user interface, and cleaner programming code, as looked at from a code jockey and software engineering standpoint. That doesn't mean that the DRR platform is bad per-se, but a central question will be what work needs to be done by the acquiring company. All PS needs is to bleed the lifeblood out of DRR in the form of the free migration for DRR members between platforms, and that is expected to ramp up this week, as PS flips the switch on that capability. How many people do that remains to be seen. Further, DRR has an active Marketplace for aggregating and licensing images, a capability that PhotoShelter launched a year ago, and closed down last month. An acquisition of DRR by PS would mean that they would be back in business with PhotoShelter Collection v2.0, and I don't see them liking that idea at all.

The altruistic and well meaning Ippolito is no-doubt having a hard time securing financing, but he's facing a far less insurmountable challenge, with the company worth less than $1m, and VC's having invested over $20m, all together. Where Ippolito could find $1m, and also the money necessary to continue the company, remains to be seen. Evan Nisselson, the company's founder, tried to re-acquire the company, and failed. Ippolito could do a good job, but won't likely get the chance.

PictureMaxx, which we recently wrote about here (10 Questions for Tom Tinervin, 10/21/08), is not likely to be interested in the acquisition. They have their own, completely different platform, and the ability to integrate the features of Digital Railroad into the PictureMaxx platform is highly unlikely. Further, they would be entering into direct competition with some of their current customers, so that's not likely either.

So, that leads us to this question - is there any real potential buyer out there? Perhaps the final player in the game could be liveBooks. Within the past year, liveBooks was approached by DRR, but there were some unreasonable requests and a starry-eyed valuation that, at the time, probably turned liveBooks off to the idea. LiveBooks certainly could use the platform, since their "Client Access" feature for their websites is clearly lacking in the robust capabilities that both PhotoShelter and Digital Railroad have to offer. Yet, both PhotoShelter and Digital Railroad do not have the functionality and optimization that liveBooks' platform offers for a facade. If liveBooks were to acquire the platform - and that looks like a decision that will based upon how well the liveBooks CTO can untangle the coding that is within the DRR .net platform, and integrate DRR into the liveBooks architecture. In doing this, they then would have a solid platform that could meet prospective clients' needs, and provide a monthly revenue stream from the DRR monthly fees, beyond the pay-once website design model, giving liveBooks a true archive capability and a more complete solution. However, what is liveBooks willing to pay? It's highly unlikely that liveBooks will write a check, but perhaps they don't have to. With sufficient cash-positive flow, and a healthy company, they could take over the code, clients, and, perhaps even run the Marketplace, and do so in exchange for a small equity stake in liveBooks, taken in lieu of payment by WTI. Their acquisition of the company would also give them a possible revenue stream from Marketplace sales, where 20% of the sale goes to the company. One question though, would be that since liveBooks is so single-photographer-centric (they only have a few agencies), how would all the agencies that DRR has on-board, be handled? There are few solutions out there. Surely, they could jump ship to PhotoShelter, code-it themselves, or, then, as noted above, there's PictureMaxx, which we previously wrote about, and DRR's Tom Tinervin is bringing PictureMax to the US, so that's quite a possibility too, since providing a platform for each of the current DRR agency clients would not be as much of a conflict as running the Marketplace themselves.

Whomever acquires the assets, they will get a core code worth, at best, $500k, and you can expect the name to go away. There will be no more Digital Railroad. This will be no merger. This will be the acquisition of the assets of a company. The bank holding the note - WTI - will have the final say. Since they're a secured creditor, and the only real one, they will be the recipient of whatever proceeds come from the dissolution of the company, from a platform sale, as well as the sale of the designer chairs by the auctioneers. The VC's are SOL.

So, will the second mouse get the cheese, in the form of a debt free company with an existing paying client base and image licensing platform? Will liveBooks be the savior of the potentially-soon-to-be-left-at-the-station Digital Railroad subscribers? And what will the fallout be between the very friendly companies of PhotoShelter and liveBooks, who would now be competing - in one way, or another? Or, will Ippolito pull a rabbit out of his hat? Or, will a bankruptcy happen, and PhotoShelter drains the subscribers from DRR, and PS and liveBooks will continue their courtship for synergies? Hang on friends, this is going to be a bumpy ride, and this will be happening fast, since this likely needs to be wrapped up before November.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

What's Wrong With This Picture?

This, the November 3rd issue of Time Magazine, has on its cover a Diebold voting machine, shot on a white seamless. Or, was it?

(Continued after the Jump)

It looks like it wasn't. Here's the first issue - the two adjusting clips on each leg do not form a cross-bar, yet the "shadow" that was laid down suggests that it is a cross-bar. If the light were coming from the left, as the shadow suggests, there would be nothing that connected the two legs. Each of those clips wrap around the leg.

Next up is the leg highlight. It is coming more from the center, and ever so-slightly from the right, as shown in the highlight on the leg. That shadow that Time created, clearly skews significantly to the right. Further, the shadow clarity - the edge and so forth, is just much too crisp and clear.

None of this would be a problem if the photo credit inside read "Photo Illustration", yet here's how it reads:

Clearly, it's listed as a photograph. Once I did a little more research, and I couldn't find it on the Getty site, I stumbled across the exact image in an article here, from 2006.

Here, we see that the shadow is at the top, in a severe fashion, and not likely a cover candidate. Further, the background seamless that photographer Henry Leutwyler used is right up against the back of the machine, not in some spacious studio, as appears in the cover image.

Time Magazine had an issue a few years back with the alterations of shadows, as commented on by the NPPA here:

Now, this shadow adjustment on the Diebold machine here doesn't have the racial implications of the OJ cover, or does it? Are we to believe that Diebold will be the reason that Barack Obama loses? That somehow the Republicans would dictate to Diebold how to throw the election? That that is even actually possible?

I am of the opinion that this image does not meet the ethical test of being a photograph. It is a photo illustration, and should have been identified as such.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Corbis Lines Own Pockets On Backs of Photographers

Yes, let's call it what it is. Corbis, not content with taking 50% of a stock sale for housing images on it's servers, has decided that that's not enough, and they now want another 10%. What with Bill Gates having retired from Microsoft, he's likely paying more attention to his other daliances, and now his attention is directed more towards Corbis, which he wholly owns.

This won't happen overnight, but when a Corbis photographer's contract comes up for renewal, they'll get a letter dictating that they'll be earning less during the next contract cycle. As laughable as it sounds, the man charged with delivering the news, Don Wieshlow, conveyed, as reported by PDN's Daryl Lang (Hard Times for Stock Continue: Corbis to Cut Royalty Rate, 10/25/08):

... he {Wieshlow} stressed that royalty rates are not the same as revenue. He said Corbis hopes the change will eventually lead to higher payouts for photographers – as Corbis invests in growth, expands its market share, and earns more revenue.

(Continued after the Jump)

I wish I had been inside the room where that sentiment was conveyed. Anyone I spied nodding their head in agreement to that malarky I would have shared with them my super-secret deal on Florida Wetlands, before loading those bobble-heading onto a bus so I could show them what piece of the Brooklyn Bridge I was offering for sale as well. Other than preserving their own salaries and bonuses, what goes through these executives' minds when they decide to take more money from their content producers?

The one upside is that the contracts were fortunately written so that the percentage was not changable during the duration of the contract. So, those of you who have 6 months to three years to get out better start looking for other platforms to license your work. Hopefully, in a year or two those platforms will mature more and produce substantive revenue for stock sales.

Then, as Lang reports, Corbis CEO Gary Shenk said “This is not our company” and gestured to the four other Corbis execs. He then gestured to include the audience. “This is our company together.”

Actually, no, it's Bill Gates' company. More specifically, it's Gates' servers, desks, and chairs, and the valuable content is owned by the photographers. Unless, of course, the new contracts will actually give photographers an equity stake in the company. That remark was an attempt at a kumbayah moment that really sounds more like psyco-babble. Paul Melcher has a comparable take on Shenks remark that's worth a read here.

I call shenanigans on this one folks. Be thankful that Corbis' legal department was incompetent enough to write a contract that precluded them from lowering these percentages during the term of the contract, or you'd all be stuck with a change effective immediately. Get while the gettin's good folks.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

Sunday, October 26, 2008

Spotlight: Tim Mantoani's Polaroid Project

Photographer Tim Mantoani is working on a labor of love - Behind The Photographs. A an auspicious project documenting the photographers behind well known photographs, along with the photographs themselves. He writes on his blog about them here - and we had a chance to catch up with him while he was inbetween portraits during the 2008 PhotoPlus Expo, and then were able to see him make an image of photographer John Reuter, who has run the Polaroid 20x24 studio since 1980. It's a remarkable process to see one of these images processed and produced - yes, still in 90 seconds.

(Comments, if any, after the Jump)

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]

PhotoPlus Expo 2008 - Day 3

The final day of PhotoPlus Expo 2008 brings interesting information from ImageSpan, and more from the newcomer on the Pro SLR block - Sony.

(Comments, if any, after the Jump)

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

[More: Full Post and Comments]
Newer Posts Older Posts