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(Not so) LuckyOliver – Shuttering Operations

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Those who actually have brain-cells functioning realize that the production of quality images – consistently and over the long term – is best left to the professionals. Surely, the Infinite monkey theorem applies to microstock – and that non-starter that is being referred to as mid-stock. Yes, NotSo-LuckyOliver tried to parlay the “we’re not microstock” approach into something.

What did their investors want?
(Continued after the Jump)

Why, a big cash payout, of course! Investors like to see large dollars as a return on their investment. When they see their one potential big buyer going private, and a wait-and-see attitude on the other players in the market, that burn-rate must have gotten scorchingly hot, and they decided to cut their losses.

I just can’t see my way clear to feel sorry for the people who are losing their jobs, or losing their image outlet. They are just one player in a segment of the industry that has been doing damage to the profession of photography. It’s a nice idea – (nearly) free images for all, but like communism, the economic viability of both is doomed from the beginning.

As they fall, photographers will respond – “see, I told you so…” Those that remain will utter that, at-least. Those that have left the profession will only shake their heads, wishing the microstock demise would have come sooner so that they could have remained photographers.

Bryan Zmijewski wrote on his blog:
“We spent the last year looking for the funds to grow LuckyOliver because, without the addition of significant capital, the return on investment for LuckyOliver and its contributors would not be satisfactory. After reviewing the options, the investment team decided that it was in the best interest of all stakeholders to shut the company down.”
Let’s re-phrase that, shall we? Try clearing out the nice-speak and saying:
“the investment team didn’t see it as smart to pump more money into a failing business model, so they decided to cut their losses, and hobble home licking their wounded pocketbooks.”
Even Bryan notes that he was pursing “…a passion that often went beyond reason.”

I am not convinced that there will always be a robust microstock industry. How many redundant servers can continue to run with a significant staff to take orders and collect $1 here, and $4 there? I expect that iStockphoto will, in some shadow of it’s former self, remain. Jupiter will likely collapse under it’s own weight – and the fickle demands of shareholders who no longer see this industry as meeting the growth that they want for their own return on investment. Further, the novelty will wear off for many of the amateurs, and the demands for releases and indemnifications of Corporate America by judgement proof individuals, followed by the lawsuits that inevitably will quash this field, will just poison the well.

One of the primary problems from a cost standpoint is the cost of maintaining customer call centers. Corporate America has wrongly outsourced that to India, and many are reeling from that stupid move. These costs, both needed to service contributors as well as the paying customers, along with IT upgrades will be what makes these models worse than risky.

We photographers, those still standing in the aftermath, will be left to pick up the pieces. And we will.

Those UnLucky “Olivers” are headed elsewhere already, as noted here. From iStockphoto, to fotolia, Crestock, to all the rest of the soon-to-be gone shops. Let the dominoes continue to fall!

To those doing this industry harm, I shall applaud as you fail. If you are contributing images to these organizations, I can say that what goes around comes around, and, to be sure, karma’s a bitch.
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.

Originally published on Photo Business News & Forum on April 16, 2008. Comments are closed; this post is part of the archive.

22 thoughts on “(Not so) LuckyOliver – Shuttering Operations”

  1. I’m shocked -horrified- bamboozled – imagine -Lucky Oliver folding!! – ‘ Babe you make my heart sing!”
    I am under no misunderstand that I can’t remain on this planet for $1 a photo let alone $50 so why are so many so gullible? It boggles-the-mind that potential investors didn’t laugh out loud at $1 photos or “mid-stock” and then flee to chortle heartily with the other “moneyed” fellows over a fine single malt Whiskey. Maybe the sane ones did! I hope to God those wounds are deep and the licking just keeps a fresh and open wound. Maybe now word spreads that this business isn’t ever likely to work so go check out something with a return – like – OIL!
    For some extraordinary reading check out the condolences from all the unhappy shutterbugs demanding their $6 I.O.U.’s. Very sad but strangely stimulating at the same time – I feel a little tingle.

    Ah, a little life returns to good business practices everywhere.
    check:http://www.luckyoliver.com/blog/show/328/Closing+the+Doors

    Thanks JH a fine commentary – but, my young Jedi – I sense you are hold back your true feelings.
  2. re: the eventual demise of microstock, I’m not so sure about that. By its very nature, the demands are mostly back-end software and server administration/maintenance (established fields with established costs) rather than human-to-human support. I have a lot of difficulty believing that people are calling up iStockphoto to ask them to throw together a lightbox or negotiate a $1 sale! On the legal side, the microstock world has wisely adopted a “releases for everything, period” stance that errs on the side of excessive ass-covering rather than too little. That doesn’t mean that I believe microstock will keep growing at this rate… but my explanation of why I believe that is a little too long for a blog comment, so I made it a post over at my own blog.
    http://ericschmiedl.com/blog/?p=88
  3. I followed the last link in your article and found it interesting that one reply listed 24 places where they market their RF images. How many outlets does it take to make money in the world of microstock? How many outlets have your RM images?
  4. Walter,

    I think having images on a gazillion places is pretty common with the microstockers. I’ve often seem them brag–as they are wont to do since it’s primarily an ego-driven “business”–about their monthly returns versus traditional stock and, if you press them on it, it turns out it they have their images everywhere with each place contributing some tiny amount of money.

    Here’s hoping LuckyOliver’s demise is the beginning of a trend.
  5. The $1.00 micrstock agencies are clearly destined for doom. Only for the fact that the next agencies will have a better cost model. FREE.

    With the growing CCTV surveillance , almost in every corner of our lives, these images will be made available free to the public and corporations alike, mind you just for the annual fee of a donation to the winning party.

    (tongue-in-check)

    There are many regular jobs that have disappeared in the past and many photography job will disappear in the future. Understanding that change and adapting to new business models is the key to survival.

    Thanks for all the articles on these changes and I hope we can all learn where the new real long-term directions are going.


    Niels Henriksen
  6. Wow, maybe it is just because I am new to the game, but it seems hard to claim the moral high ground and exhibit such hateful bitterness at the same time. I always thought it was pretty obvious that the microstocks were for amateurs and lo-budgets, from each side of the equation. Amateur and lo-budget photographers and amateur and lo-budget designers looking for images. Like I said, I am new… so I just see the news, I don’t really feel it like some who make a sizable chunk of their change on in the stock market might, but what I do know is that there is definitely a lack of professionalism in being so excited over another persons failure.
  7. I am of the opinion that this business, like so many “new paradigms” are just proofs of the fact that there is no free lunch.

    Unfortunately, it is forays into these ill-advised ventures that hurts so many people.
  8. Really this development is anything but a surprise. There will certainly be more that fail. I’ve never been a believer that microstock would take over. I agree there will likely be some that survive, but their losses will be offset by profitable arms of larger corporations. I still don’t see the model being profitable to survive in the long run whether sheltered by a larger corporation or not. As you’ve stated it is just a matter of time before more fall…
  9. Is this a failure of the model or their marketing (or lack of it?)

    I am familiar with only a couple of micro-stock agencies, mostly because I don’t shoot for that market.

    This was the first time I’d heard of this company, but there are several others that I’d recognise the name if I saw it again.
  11. LuckyOliver is certainly not a good example to base your predictions on for the future of microstock. The guy that ran it (Bryan) was famous for not marketing the site and even a complete idiot would be able to forsee it was destined to fail, it has been said the site was just set up as a ‘loss making business’ and looking back at the history it would appear this could be true.
    As for the future of microstock you have to wonder why Getty bought iStockphoto and Corbis,Jupiter amd Inmagine have all set up their own microstock sites, hardly the thing to do in a market that isn’t going to survive.
    You can bury your heads in the sand if you want, or do what most Pro photographers are doing and that is keep up with the market.
  12. Anon, you raise interesting issues w.r.t. the insufficient marketing of LuckyOliver & its purpose as a loss-making-business. Could you point us to links (forum postings, statements elsewhere, etc) that back up your statements?
  13. The Theory: Lose $2.00 on every sale, but make it up with volume sales.

    Proved.

    The Premise: What’s not a good business model?


    I see this as one dose of ‘good’ news to some of us non-adapted dinosaurs. Whether it merits a told-you-so attitude or that your predictions of the MS industry will come true may still be premature. Show me the same headline for a dozen other similar agencies, and maybe then I’ll believe that any change as come. Regretfully, I won’t be holding my breath, but I will shout from the rooftop on each occasion.
  15. You all make me laugh. Answer this question – are microstock photos crap?
    If you answer yes, then why you are afraid of microstock? There are two possibility: 1, your images are crap too so you fear competition from weekend shooters. 2, you don’t understand that good quality photos don’t sell for $1. Read Dan Heller article on Myth that microstock hurt and maybe you can understand.
    If you answer no that you think microstock photos are not crap your fear is real and your days have numbers. you are victim of technology and you not good enough to survive. bye bye!
  16. You don’t seem to understand the basics of a new world order: There will always be “professionals” to do the high end productions but for the rest there will certainly be “microstockers” or whatever you call them.

    Sorry man: No more 350 USD for one lousy image! Get used to it.
  17. I feel that I should remind the author . . . We’re in the 21st Century now. Traditional protections of all artists — graphic, photo, music and all — are undergoing radical change and the change is certainly not yet over.

    Given your infinite amount of monkeys with typewriters (or word processors?) one of them will write King Lear. Another will write King Lear, omitting a coma. Another will write King Lear with an extra word. And so on. Ad infinitum. So what now is the value of King Lear?
  19. You really have the time to write such article… Or you’re frustrated?
    Agencies may fail, be them trads or microstock. You fail to see the new concept, you’re doomed, unless you’re in a very strong shape (financially, creatively and business wise).
    So, you found an example of a microstock failing. They popup like mushrooms, of course some fail. There were others before. But how many traditionals have you heard about lately, that go out of business? Compare that percentage-wise to the number of newly lauched traditionals…. Scary, isn’t it?
  20. Just one comment: Yuri Arcurs. Check this guy!
    It’s not about selling a photo for 1$. It’s about selling a photo 1000 times for 1 $. That means 1000$ for a photo (per year 🙂 i think microstock is future.
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