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Summary:

The market is tough for photo apps outside the realm of Facebook and Instagram, as shown by layoffs at the photo-sharing app Hipstamatic on Thursday.

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It’s been a big day for photo apps, but probably not in the way folks at Hipstamatic would have hoped. Just as Instagram released a significant update to its app, adding geolocation features and enhancing a user’s ability to tell stories, reports are surfacing that much of photo app Hipstamatic’s team has been laid off.

Hipstamatic is a photo-sharing app that lets users apply filters much in the way Instagram does, but has lagged in popularity compared to its much flashier competitor, which is awaiting government approval to join Facebook. Hipstamatic and Instagram forged a deal earlier this year, allowing users to post photos from the paid app Hipstamatic to the free Instgram, but it seems the bootstrapped underdog in the photo-sharing world couldn’t keep up.

Photobucket also released new features on Thursday, demonstrating how difficult it is to be successful in the photo space dominated by Facebook for desktop photo uploads and Instagram for on-the-go shots.

Instagram is currently ranked seventh in the Apple iTunes store’s list of free apps. Hipstamatic is ranked 99th on the list of paid apps — it costs $1.99 to download.

Several former Hipstamatic employees and friends took to Twitter to vent over the layoffs:

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  1. Nick Donnelly Sunday, August 19, 2012

    Because they have no business model – just like Instragram didn’t.

    Both awful businesses – business is about making money, people will remember this one day…

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