Shaking Out Photo-Sharing

The photo sharing market is considerably different from how it seems if you only paid attention to blogosphere chattering. Hitwise’s Leann Prescott ably makes the point in a post containing the following chart:

Photobucket’s first place position is just another example of how backending other services — especially doing it without waiting for permission — is where the real leverage is online.

[Update] Flickr’s Stewart Butterfield responds here.


  1. By “just another example of how backending other services — especially doing it without waiting for permission — is where the real leverage is online.” do you mean supporting other community/social/viral sites?
    If that is what you mean, then how exactly does (will) photobucket make money?
    Seems like they will never have the kind (number) of page views that the sites where the photos are actually displayed will, so ad-supported seems marginal. Doesn’t look like much potential to charge fees (in the current environment), so again, how do they make money?

  2. Do you really think that the ad revenue stream and/or licensing agreement stream will increase at the same rate as the capex and opex required to maintain the infrastructure and store/serve the volume of content?
    I doubt it.
    The commodization of on-demand printing / storage sites (Kodak gallery, shutterfly, etc.) makes the space increasing look like it’s ripe for a rollup – I.e. Photobucket + Shutterfly + some sort of Myspace-ish site layout customization (i.e. Tabblo)

  3. Matt –
    That takes it out of “infrastructure” and puts it in “retail” (as it were).
    I wonder if Paul has an idea as to how these “infrastucture” guys – which I believe is the point of his original posting – ever make money.
    That’s what I am interested in hearing about :)

  4. Bumped into the bizdev guy from Photobucket in the elevator today. Told him about this blog post, and he chucked that they try to keep under the radar…

  5. Paul, I read your post yesterday and meant to respond but didn’t have a chance. I feel a little sheepish, but I posted a long response on TechCrunch instead since of all the many places this got picked up, theirs was closed to the top post 😉
    As a data junkie, check the relative growth rates and note the Photobucket:ImageShack ratio worldwide.

  6. Ooops – my comment on TechCrunch was not actually published. I can see it, but apparently no-one else can (still awaiting moderation, but it was posted more than 12 hours ago). I’ll post it here instead …

  7. [Note: I’m a co-founder of Flickr and act as its general manager inside of Yahoo!]
    Two comments on this (most people will want to skip right to the numbers section, but it’s less relevant than comparing the products):
    The products:
    I don’t really think of Photobucket as a competitor to Flickr. Though, as the Hitwise blogger says, “what they both do is enable people to share images online”, I’m not sure that that makes a “market”: They serve totally different purposes and I don’t think the people who use them would find either a replacement for the other. Photobucket is great at it’s job, and I humbly think Flickr is too 😉 But when I think marketshare, I think direct alternatives (Toyota vs Honda or Google Search vs Yahoo! Search vs MSN Search).
    But even if we accept that there is such a market as “sites that enable people to share/host images online”, these would not be the right sites to include: MySpace itself allows photo uploads and is presumably bigger than Photobucket in serving their own users (as they are reportedly are for videos). Meanwhile, Facebook claims that it is the biggest photo sharing site on the internet. But I’d happily wager than Yahoo! Mail is by far the biggest “photo sharing” site of all in this way of thinking, and Hotmail would be close behind it.
    But a list of photosharing sites by marketshare that went:
    Yahoo! Mail
    MSN Spaces
    … etc.
    would seem pretty weird :)
    And, a different way of looking at it: if you drew a line from Flickr to Photobucket in the “conceptual space of internet products and services” and started extrapolating, that line would probably go to Akamai more than it would to mail or SNSs (and in a way, Photobucket is a consumer counterpart to Akamai’s enterprise service). But anyway …
    The numbers:
    The Hitwise stats are (a) US only and (b) (apparently?) counting entries in ISP’s proxy logs. So, this is not unique users, or pageviews, or even necessarily image serving traffic (a lot of requests for different infrequently-viewed images will cause more entries in the proxy logs than a smaller number of images each with massive traffic). If that’s how it works (and I actually don’t know) it seems more like they’re counting “marketshare” of lines in ISP proxy log files than any traditional understanding of marketshare.
    For purposes of comparison:
    Nielsen/NetRatings just announced US numbers for April which were significantly different. Summary (in thousands of unique users):
    Photobucket: 7,838 (vs 5,419 a year ago for 45% growth)
    Y! Photos: 7,772 (vs 6,439 a year ago for 21% growth)
    Kodak: 7,633 (vs 6,508 a year ago for 17% growth)
    Webshots: 6,070 (vs 6,070 a year ago for -15% growth)
    Flickr: 4,816 (vs 1,080 a year ago for 346% growth)
    Meanwhile, Comscore’s US numbers for May have been out for a while. For the sites mentioned by Hitwise (Hitwise didn’t include AOL Pictures, but if they had, they’d be in the middle of the pack on these two lists):
    Y! Photos: 11,328 (vs 9,778 a year ago, for 16% growth)
    Photobucket: 10,292 (vs 3,224 a year ago, for 217% growth)
    Webshots: 8,478 (vs11,082 a year ago, for -23.5% growth)
    Kodak: 7,431 (vs 5,625 a year ago, for 32.1% growth)
    Flickr: 5,163 (vs 923 a year ago, for 459% growth)
    Imageshack: 5,006 (vs 3,593 a year ago, for 39% growth)
    SnapFish: 4,755 (N/A)
    Shutterfly: 4,126 (vs 2,732 a year ago, for 51% growth)
    PIcturetrail: 1,286 (vs 2,020 a year ago, for -36% growth)
    Slide: 1,072 (N/A)
    Comscore’s latest worldwide figures for all these sites only go to April:
    Y! Photos: 30,736 (vs 27,217 a year ago, for 13% growth)
    Imageshack: 23,862 (vs 12,448 a year ago, for 92% growth)
    Webshots: 19,755 (vs 24,901 a year ago, for -21% growth)
    Photobucket: 16,763 (vs 8,896 a year ago, for 88% growth)
    Flickr: 16,516 (vs 3,423 a year ago, for 383% growth)
    Kodak: 9,552 (vs 7,313 a year ago, for 31% growth)
    SnapFish: 6,714 (N/A)
    Shutterfly: 4,609 (vs 3,841 a year ago, for 20% growth)
    PIcturetrail: 2,493 (vs 2,778 a year ago, for -10% growth)
    Slide: 1,360 (N/A)
    Photobucket says they have 18m users, and I have no reason to disbelieve them. So, Photobucket’s self-reported numbers are pretty close to Comscore’s (Comscore or any other reporting system is never going to be perfect – I have access to internal data for two of the properties on that list, so calibration is a little easier). Comscore’s numbers are fairly close for Flickr too (the ratios are off though: they seem to undercount Flickr’s US traffic and overcount the rest of the world).
    Bottom line: NNR, Comscore, Alexa, Photobucket’s public statements and our internal data all roughly agree[1]. E.g., in unique users worldwide, Photobucket:Flickr is about to 1:1, while in the US the ratio is somewhere between 3:2 and 2:1 — as opposed to the 7:1 Hitwise reports.) Averaging them all out, Hitwise is definitely the outlier by a very wide margin. So, take it with a grain of salt.
    [1] And other anecdotal facts align with these, like the number of incoming links to Photobucket and Flickr on Goolgle. Flickr with 260k and Photobucket with 218k.

  8. Man, I can’t get my comment published on TechCrunch, here or Om’s site. I think it must be an early long weekend in blogland. I’ll email it instead :)

  9. I can’t see Stewart’s comment at Tech Crunch either… there are 2 short comments by Stewart, but not the long one.
    Man, this may be the most anticipated comment in the history of the blogosphere – it better be good! :)

  10. It’s not THAT good, but it was long and contained links, so I guess that trips people’s spam traps and puts it in a moderation queue (a much longer one than I would have expected for any of these blogs, but eh — I guess I should just get my own blog 😉

  11. Photo Fanatic says:

    Sounds like someone got their feathers ruffled. Stewart, it sounds like you really want to prove that you are not smaller than Photobucket. If you are truly different, why all the postering?

  12. No, Flickr is smaller than Photobucket by all the metrics discussed here (except for growth) so I’m not trying to prove otherwise. And as for whether they’re different, that seems like a pretty objective matter and not something we could make up.
    On the other hand, my feathers *were* ruffled by the credulity of the bloggers who posted about this: not so much as an “according to a study by …” or “Hitwise reports that …” which’d never fly in that boring old “mainstream media”.

  13. Mr. Butterfield (I’ve always wanted to say that): I hope you weren’t alluding to me in your (deservedly) cranky comment above. I studiously cited it is a Hitwise document, and then, of course, wandered, off to make some unrelated comment about something or another.

  14. Dr. Kedrosky (I remembered, see?): I’d never suggest you maintained anything but the highest standard of editorial integrity. But that’s mostly because I wouldn’t ever want to get Loeb’d 😉
    Seriously though, your take was pretty neutral. I’m not sure if I agree with the lesson you infer from it though (or, maybe I just disagree with what counts as “real leverage” – hooking in an separate phenomenon for distribution may get you distribution, but it also makes you dependent and probably more vulnerable).

  15. Ah, the deterrence effect of having a rep for flying off the handle at the least provocation ….
    To your point: I know what you mean, tying yourself to someone else does make you vulnerable, but in a crowded market cheap distribution is king, and that’s pretty compelling leverage.
    Btw, see the price that the WSJ says Shutterfly thinks it can get? $400-$500m would be impressive, if the company can pull it off.

  16. Hey, don’t forget 😀 Another newcomer!