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Though a deal with Getty Images for Jupitermedia fell apart last February, Jupitermedia CEO Alan Meckler said a divestiture of the images business remains possible. He declined to comment on whether he is in talks with anyone to sell the images division, which he valued at roughly USD 380m at the time of talks with Getty.
“People know I’m a trader,” he said. Adding that such a move is not an active pursuit, he said that with an undervalued stock, bidders could become interested in the assets of his Connecticut-based business. “I would say we’re going to have greater growth from the online media division now,” Meckler said.
On Wednesday, Jupitermedia reported it missed earnings forecasts with a second quarter net income of USD 619,000, down from USD 2.42m at the same time last year. Meckler said the images business represents 70% - 75% of the company’s revenues.
The images division could be attractive in light of its library of high quality images and the value of its well-known subscription-based business, said an industry analyst. For instance, he said that Corbis, long known as the number two stock imagery player, could increase its images library by picking up the pieces of the Getty deal.
Similarly, he said, media companies such as The New York Times Company could look at all or an element of Jupiterimages to add to their existing image collection. As another option, he said a media company could acquire Jupiterimages’ lower end stock for its various media properties.
Although Meckler said he has received around 10 offers to take the company private, he said he had declined them for a number of reasons.
The stock imagery market has been weak in the last year, which has hurt Jupitermedia, Jeffrey Shelton, an analyst with Natexis Bleichroeder, said separately. The industry is in a stage of transition because of the rise of micro-payment websites, he said. These sites sell lower quality images at a lower cost than their higher quality counterparts.
“Everyone is still trying to figure out to what degree that cannibalizes existing revenue streams,” he said.
Shifting its business emphasis into media, Jupitermedia made a high profile, USD 23m acquisition of Mediabistro last month. CEO Meckler said his buy of the well-known, media-oriented job site could help his company develop a new niche within media.
It should also provide a new outlet for the sale of services such as trade show passes or webinars, he said.
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