In an email send globally, Jonathan Klein finally announces the layoffs:
It starts :
“ I am writing to you today with some unpleasant news. We have tried very hard to avoid lay offs during the continued turmoil in the worlds economy. However, it is now clear that we have no alternative. We must take decisive steps to ensure we emerge from this recession strong and able to best preserve the success of Getty Images.
Today we are announcing that approximately 110 employees globally, which is roughly 5 percent of our workforce, will be asked to leave Getty Images. This decision was difficult and was one that we had hoped to avoid. Those who are leaving will of course be offered severance packages. ”
He continues by saying that the Sales related department will be most impacted. Unlike other companies who have blamed everything from the recession, to “nasty” banks, loans and global warming, Klein it quick to reveal that it is due more to” a result of changes in the imagery business” than the world’s economy.
Another impacted department is the creative , where Getty will ” also [be] reducing [its] investment in wholly owned creative shoots.”
What is also revealed is that the new owners have participated financially in the acquisition of Jupiterimages : ” The viability of our company is not in doubt, provided we take the right and necessary decisions. Our partners, Hellman & Friedman, recently invested even further to finance the Jupiterimages acquisition and they remain very supportive of the Company, our strategy, the management and the steps that we are now taking ”
The email also announces the suspension of employer contribution to the company 401k plan at least until 2010. It is not a surprise that the stock giant is going threw this process. Between the acquisition of Jupiterimages and the beating that commercial stock is taking from microstock, it was inevitable. It is also heavily suffering from a sharp decline of subscribers to its wire service ( aka, newspapers are closing) and an overall slump in the editorial market. Since it has transposed its subscription model to web medium, it can’t really look for the internet for a reprieve.
Getty is now facing its own demons, microstock and subscription. Both have brought down the price of imagery. Not really a good long term business model, as they now realize.. It will not be surprising to see them increase the pricing of some of its offering, not only to generate more revenue but to stop the talented photographer hemorrhage that they are now starting to feel.