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Webshots Beautifies… Who Next?

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Webshots, the online photo-sharing granddaddy, is releasing a major redesign of its site tonight. We’d thought this was happening tomorrow, but a little bird told us it was already live. The site seems to be in transition as we write…some parts updated, some parts not. Webshots, owned by CNET, has made itself prettier and easier to use, emphasizing user community aspects, while bumping up upload limits and cutting down ad spaces by 40 percent.

While others have been coy about adding video, Webshots says it will integrate short video sharing soon — but not until the fall. Webshots has 19 million unique visitors per month, with 420 million photos shared to date and 1 million new photos per day.

Big photo sites like Webshots have managed to maintain huge audiences, but it’s clear they have Flickr envy. Webshots is the most recent photo site to web 2.0-ify itself: a reborn Yahoo Photos launched to the public just two weeks ago. Along those lines, there are likely to be opportunities for photo-sharing startups to find buyers who want a pre-built user-generated photo-sharing community. So who’s likely to be acquired? Let’s work through the options.


As we see it, there have been two rounds of online photo acquisitions: first, the photo-printing sites — Kodak bought Ofoto, Hewlett-Packard bought Snapfish — then, the photo-sharing and organization tools — Yahoo bought Flickr, Google bought Picasa. Today, it seems like the latter two may have been smarter choices.

Photo-printing may be a big business, but there is too much competition to make much money off it. You can see lots of evidence of this issue in the Shutterfly IPO paperwork. Additionally, younger generations seem increasingly disinterested in printing their photos; Flickr, Zooomr, MySpace, and Facebook are the places to share your pictures.

You’d think Kodak and HP would be kicking themselves, wishing they had the foresight to buy what’s going to be hot next year. But their interest, especially HP’s, has been in selling printers and ink, so printing sites it is. Still, both companies sell cameras, so don’t count them out for another round of acquisitions.

We’ve heard Kodak is talking to Zooomr. We think other consumer electronics firms could also be likely purchasers for online photo sites. What about Canon or Sony? Circling back to Webshots — they are doing a targeted ad campaign for Casio starting in September. Since it’s already owned by CNET, Webshots might not be the most viable acquisition target, but hey, it’s already been sold (and bought) twice.

Who else?

  • Shutterfly, a peer to Ofoto and Snapfish that has stayed independent, reportedly shopped itself around to acquirers recently before filing to go public, but this is not the kind of startup we’re talking about. Not only is Shutterfly too big, it is too beholden to its focus on printing and other physical products. But it’s not like calling off your IPO is unheard of these days.
  • Facebook now hosts over 400 million photos, with members uploading 2 million per day. The company says comScore calls it the number one photo site, though we haven’t seen that list firsthand.
  • comScore’s competition, Hitwise, previously put Photobucket at number 1.Low-fi Photobucket takes the web 2.0 philosophy to a different level, acting as a hosting service but mainly helping members post photos and videos off-site.
  • Mobile photo services like ShoZu, TextAmerica
  • Other popular web-based offerings such as Piczo and SmugMug

15 Responses to “Webshots Beautifies… Who Next?”

  1. Liz, this is Mark Bole, CEO, ShoZu. I just wanted to add a quick comment saying that we do appreciate being included in this round- up and it is our differentiating features that distinguish ShoZu in this list. In reference to our exit strategy, I am happy to speak to you or Om in further detail at your convenience.

  2. I think you need to seperate out the photo printing businesses from the sharing businesses as revenue is derived differently. It is very difficult to compare apples to oranges.

    As a disclaimer, I was the original product manager at MyPhotoAlbum.com and the reason we went for the non-printing market originally was that everyone was focused there years ago. The beautiful part of the Internet is that you can share anything – so why not share your photos? Printing just adds another layer of complexity and logistics and is easy to outsource.

  3. Former Reader

    The quality of reporting on this site has come way down in the rush to crank out content and sensationalize it.

    Please do some thinking, some fact checking, and some editing.

    By the way, where is Photobucket on the quiz list?

  4. I’ll ask Om about the multi-choice questionnaires! We know Facebook is not purely photo-sharing, and ShoZu is more of an enabling tool…but to me those distinctions make them appealing. Andy — you work for ShoZu/Cognima, right? Are you saying y’all aren’t interested in being acquired?

  5. ShoZu doesn’t really fit here – it’s not a web site for sharing photos & videos, it’s a gateway between the phone and web sites like the ones mentioned above (including Flickr, YouTube, Webshots, Kodak EasyShare Gallery, Buzznet, Textamerica…).

  6. Snapfish was also sold and bought twice.

    All in all, I think it is wrong to say that the photo printing sites were bad purchases, but it may be true that they are not evolving fast enough for new tastes. Let’s not forget the middle of the country, where sites like Ofoto, Shutterfly and Snapfish fit the bill moreso than Web 2.0 sites.

    I think the bigger question is not who is going to be acquired, but who is the next Zing or PhotoPoint.

    Disclosure: worked at Ofoto, and prior on EK.

  7. Snapfish was also sold and bought twice.

    All in all, I think it is wrong to say that the photo printing sites were bad purchases, but it may be true that they are not evolving fast enough for new tastes. Let’s not forget the middle of the country, where sites like Ofoto, Shutterfly and Snapfish are all that’s necessary.

    I think the bigger question is not who is going to be acquired, but who is the next Zing or PhotoPoint.

    Disclosure: worked at Ofoto, and prior on EK.

  8. You are mixing apples and oranges: photo hosting/sharing, photo printing, mobile phone photo applications, photo aggregation, social networks with photo sharing features,…
    And therefore you would need a multi-choice questionnaire to name favorites.

  9. “Photo-printing may be a big business, but there is too much competition to make much money off it.” – The Kodak’s and HP’s struggle to make money from photo printing because they all follow the same traditional model. Look at http://FotoInsight.de for a profitable (European) photo processing and printing business. Its a company that constantly pushes new gifts and improved photobooks.