Following the unexpected demise of the PhotoShelter Collection, Digital Railroad issued a statement that reaffirmed its commitment to its own stock-licensing business. Posted on the corporate blog on Friday, the statement promises too build the Digital Railroad Marketplace into a sustainable business with long-term value.
When describing the PhotoShelter Collection, CEO Allen Murabayashi often stressed that it did not directly compete with Digital Railroad’s “pay to play” scheme. While PhotoShelter executives viewed the open nature of its stock collection as fundamental, others view it as one of the reasons for the company’s failure. Digital Railroad describes PhotoShelter’s stock business as “handicapped by the limitations of a business model that depended far too much on largely part-time photographers to satisfy the requirements of full-time professionals.”
Digital Railroad also reminds the industry that PhotoShelter was “not the first company to attempt to build a marketplace for the stock licensing business, [it was] merely the first to fail.” Digital Railroad was established in 2003, two years earlier than PhotoShelter. Until now, the two companies appeared nearly identical in every other way: Both began by offering pro photographers storage and e-commerce services. Both expanded into stock licensing at roughly the same time.
PhotoShelter has recommended that photographers consider Alamy as “the closest agency to the PSC model.” Since the British company was already on the market when the PhotoShelter Collection launched, Digital Railroad seems more likely to reap the benefits of PhotoShelter’s exit from the stock space—particularly if photographer dissatisfaction with PhotoShelter results in a loss of market share for online archival services.
According to the company, the Digital Railroad Marketplace is on track to pay out $1 million in contributor commissions this year. “We believe the DRR Marketplace is ideally positioned to consolidate a significant portion of the remaining 60% of the $3 billion stock-licensing market,” claims the statement. Digital Railroad executives disagree with PhotoShelter’s assessment of the industry’s poor growth prospects: “We are bullish about the future and believe sustainable, aggressive growth is possible.”