PicApp is no more.  Launched a little bit earlier than GumGum, PicApp was an image portal offering free images via an embed option in exchange for advertising. The idea was noble, in sort. It allowed for cash-poor blogs or websites to use images from major image providers,  like Getty Images, Splash or Newscom, for free. In exchange, photo agencies, as well as Picapp would share revenues made by clicks on adverting.

It didn’t work for many reasons :

It was impractical. If you found an image you liked on one of the photo agencies and wanted to embed it, you had to leave it and go to PicApp to do so. A bit if you went to a supermarket, decided to pay via credit card and they told you to leave the merchandise, leave the store and go somewhere to redo a search and finally pay the way you wanted.

It was competing against its own image providers. Instead of being a sales partner for those agencies who participated, they had to lure customers way from them in order to be succesful. However, not only the photo agencies have an advantages by having their credit along every image published but PicApp never really launched a marketing campaign. They were probably hoping for a  viral explosion.

The business model was flawed. People do not click on advertising embedded in images. They might click on the image, not on it’s advertising. Furthermore, PicApp had to go out and sell it’s advertising space. With little or no knowledge on who would see the ads and no prior experience in the business, it was also a failed task.

It never became open to users. The only images available were those of established photo agencies. A maybe wiser idea would have also allowed users to upload their own images  in order to seek revenue from them. Having your users participate in the growth of your services in exchange for money is now becoming the norm for any succesful web enterprise.

It never reached critical mass, if it does exist. The fundamental assumption of PicApp was that enough users would publish enough embedded images generating enough clicks to make it a viable business. Either via a few images embedded an obscene number of times or many, many different images published a few times.  There is not been any examples of any editorial images going viral. Photographs that go viral are mostly user-generated and have nothing to do with regular editorial coverage.  PicApp was hoping for some kind of  Google type of acceptance. It never got it.

The company is not dead . Instead, it has shifted it’s attention to offering on the fly slide shows to those who put up a snippet on their website. Their new offering doesn’t make their business model obvious but it seems that those slide show will soon have advertising on them.  It is also very unclear how participating photo agencies will benefit from this, if at all. They will now see their images available on websites who have  will have no need to officially request them. It is nice of these photo agencies to let PicApp experiment with their content until they find a viable business model.

GumGum, PicApp infamous competition, has been very quiet for a while. After getting some funding, they have disappeared into super stealth mode, also probably trying to figure out how to make money with the embedded image idea while they burn VC money.

The real issue with those PicApp, Gumgum type of companies,  is :

– They work as photo portal and have to take traffic away from photo agencies in order to be succesful

– They work a third party licensing system for photo agencies, taking a commission for every sale they perform

Thus they take a commission of every sale they take away from the image providers they work with .  How does that make any sense for a photo agency ?

Author: pmelcher

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