Getty abandons Shutterstock merger plans

Getty has delivered a notice to Shutterstock terminating their merger agreement, which the CMA had conditionally cleared earlier this year.

Responding to the decision, Margot Daly, chair of the independent inquiry group leading the investigation, said

The decision by Getty to abandon its merger with Shutterstock is ultimately a commercial choice. Our investigation cleared the merger on the condition that the companies sold Shutterstock’s editorial business – which is something they initially offered to do at an earlier stage of proceedings.

Since our final report, we have worked swiftly and closely with Getty and Shutterstock on the proposed sale and have engaged with several potential buyers to assess their suitability. This process was at an advanced stage at the time of Getty’s announcement.

Getty’s decision not to proceed with the merger follows an in-depth investigation where the CMA concluded that the deal could go ahead if Shutterstock’s editorial business was sold to an approved buyer. Getty and Shutterstock had previously claimed that the deal would produce annual cost synergies of $150-200 million within three years of completion. These claimed synergies related primarily to their stock content businesses, where the inquiry group ultimately found no competition concerns, and as such, would have been preserved by an editorial sale.

Since its final report in May this year, the CMA has been working closely with Getty and Shutterstock on Shutterstock’s ongoing process to sell its global editorial business, including consulting on undertakings to implement remedies and engaging with several potential purchasers.

The inquiry group found that a loss of competition between the two businesses would reduce choice for UK media outlets and could lead to higher prices, with knock-on negative impacts for consumers who rely on high-quality editorial content to stay informed. During the investigation, the CMA received extensive evidence, including from UK media organisations, publishers, competitors and content suppliers, which showed that Shutterstock provides one of the few meaningful alternatives to Getty, the market leader in editorial content in the UK.

As a result of today’s announcement, the CMA will cease its remaining work on this case.

Further information is available on the CMA’s case page.

Notes to editors

1. At the end of the CMA’s phase 1 investigation, Getty and Shutterstock offered to sell Shutterstock’s entire global editorial business, which operates under the Shutterstock Editorial, Backgrid and Splash brands and competes with Getty across live and archive news, sport and entertainment content.
2. At that stage, the package of remedies offered did not address the CMA’s concerns at phase 1 in respect of stock content, and so the deal had to be referred to phase 2.
3. After extensive additional evidence gathering at phase 2, including a customer survey, the CMA concluded that the deal would not give rise to concerns in respect of stock content. This is because GenAI had continued to develop during the CMA’s investigation and over time, the CMA received evidence to conclude that it is likely that large GenAI firms that do not offer pre-shot stock content will increasingly compete with Getty and Shutterstock, and the constraint from existing competitors Adobe and Canva will likely also increase.
4. After the CMA published its interim report identifying provisional concerns for editorial content in February, the businesses put forward a substantially reduced proposal to sell only Shutterstock’s Backgrid and Splash celebrity entertainment businesses, which primarily focus on paparazzi, including certain types of paparazzi which Getty does not supply. Having consulted on this proposal, the inquiry group concluded that this would not be an effective remedy because it would not restore competition that Shutterstock currently provides. No third party told the CMA it would be effective.