Stock image provider Shutterstock and AI developer OpenAI, the company behind ChatGPT, are extending their partnership that gives OpenAI access to Shutterstock’s content while granting Shutterstock access to OpenAI’s artificial intelligence tools.
The news sent New York-headquartered Shutterstock’s shares soaring on Tuesday. SSTK closed at $53.36 on the New York Stock Exchange Tuesday afternoon, up around 9% for the day.
The new agreement solidifies a symbiotic relationship between the two companies, with San Francisco-headquartered OpenAI gaining greater access to Shutterstock’s image, video and music libraries for the purposes of training its AI algorithms, while Shutterstock gains access to OpenAI’s tools, including DALL-E, a text-to-image generator that creates visuals from users’ verbal prompts.
In addition to text-to-image generation, Shutterstock’s customers will gain access to tools that will allow them to easily edit and transform any image in the Shutterstock library.
“The renewal and significant expansion of our strategic partnership with OpenAI reinforces Shutterstock’s commitment to driving AI tech innovation and positions us as the data and distribution partner of choice for industry leaders in generative AI,” Shutterstock CEO Paul Hennessy said in a statement.
OpenAI COO Brad Lightcap said the company is “pleased to be able to license Shutterstock’s high-quality content library. This extended collaboration not only enhances the capabilities of our image models but also empowers brands, digital media, and marketing companies to unlock transformative possibilities in content creation and ideation.”
Lightcap noted that OpenAI’s tech will also be available to users of Giphy, the GIF library and search engine that Shutterstock acquired earlier this year.
Shutterstock and OpenAI inked their original deal in 2021, giving OpenAI access to a library of images from Shutterstock that OpenAI CEO Sam Altman has said was “critical” to the training of the DALL-E engine.
(Altman was among a group of tech business leaders who signed a single-sentence statement earlier this year, stating: “Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war.” Altman also testified in front of the US Congress, calling for regulation of AI development.)
Shutterstock integrated OpenAI’s technology and began offering customers access to image-creation tools in 2022. The company also launched a fund to ensure that creators whose works are used in the Shutterstock library are fairly compensated.
Shutterstock is one of the world’s largest providers of stock images. The company reported revenues of $827.8 million in 2022, an increase of 11% YoY on a constant currency basis. Net income came in at $76.1 million, down 17% YoY, and the company posted EBITDA of $218.1 million, a 13% YoY increase.
According to Datanyze, Shutterstock holds a 71% worldwide market share among stock photo providers, with some 409,000 businesses using the service.
“The renewal and significant expansion of our strategic partnership with OpenAI reinforces Shutterstock’s commitment to driving AI tech innovation and positions us as the data and distribution partner of choice for industry leaders in generative AI.”
Paul Hennessy, Shutterstock
While Shutterstock may be best known for its extensive library of images, the company has been busy building up audio capabilities as well. In 2020, it acquired AI-driven music platform Amper Music for an undisclosed sum, and in 2022, it bought video marketplace Pond5, gaining a library of 1.6 million music tracks as part of the deal.
The company also owns PremiumBeat, a royalty-free music library which Shutterstock acquired in 2015.
OpenAI was founded in 2015 with Altman and Elon Musk serving as the company’s initial board members. The firm is structured as a non-profit, with a subsidiary – OpenAI Limited Partnership (LP) – acting as its for-profit division.
The company became a household name in late 2022 with the release of ChatGPT, which – until the release of Meta’s Threads last week – was the fastest-growing app in history, reaching 100 million users within about two months.
“This extended collaboration not only enhances the capabilities of our image models but also empowers brands, digital media, and marketing companies to unlock transformative possibilities in content creation and ideation.”
Brad Lightcap, OpenAI
Among OpenAI LP’s biggest investors is Microsoft, which put $1 billion into the company in 2019, and another $10 billion in 2023.
The company posted a net loss of $540 million in 2022, a doubling of its loss from the previous year, reportedly due to costs associated with developing ChatGPT and hiring new talent. According to sources cited by Reuters, the company expects revenues of $200 million this year, and $1 billion in 2024.
OpenAI has itself been active in the music space.
In 2020 it announced the launch of Jukebox, a “neural net” that is capable of generating music, including “rudimentary singing.” It also created MuseNet, a neural network that can generate four-minute music tracks using 10 different instruments, and that can “combine styles from country to Mozart to the Beatles.”
The company was recently the target of a pair of lawsuits filed by authors – among them comedian Sarah Silverman – accusing the company of training its AI on their copyrighted written works without permission. The lawsuit could have implications for the music industry, which is working to prevent the unauthorized use of copyrighted music in the training of AI music generators.Music Business Worldwide