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Photo-storage service Picturelife shuts down 18 months after being acquired

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Its 200 million photos are now stored on SmugMug

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Picturelife, a four-year-old photo-storage and management service acquired by digital media hub Streamnation last year, is shutting down. An email sent to subscribers today said the service faced "a challenging economic environment" and was no longer viable. Members will have the option of transferring their photos to SmugMug, a paid photo-storage service aimed at professional and semi-pro photographers, and continue to view and download them for no cost.

Picturelife was part of a raft of venture-backed services that began popping up around 2010 to organize the increasingly huge volume of photos we had begun taking with our smartphone cameras. The services — which also included Everpix and Loom — struggled to attract paying customers. In the meantime, giants including Google, Apple, and Amazon released cheap or free photo-storage solutions of their own, making it even more difficult for startups to compete.

"Nobody is interested in cloud storage anymore."

Jonathan Benassaya took a different view of the market. Benassaya, who previously co-founded European music streaming service Deezer, saw an opportunity to build a home for consumers' digital files and offer unique services on top of them. In February 2015, he announced the acquisition of Picturelife for an undisclosed sum. Picturelife was already struggling with the forces that would lead to its shutdown today: slow user growth, increasing costs, and difficulty in converting its free users to paid subscribers. Benassaya believed it would be more successful as part of a unified service.

Benassaya had been funding Streamnation himself. To build a unified platform, he would need to raise money. In September, he began meeting with investors. They were not enthusiastic. "Nobody is interested in cloud storage anymore," Benassaya said when I spoke with him today. "It's been pretty challenging." One investor finally agreed to offer a term sheet in February, but withdrew the offer the next month. (Benassaya won't say who.)

"I had a moral obligation to save those pictures."

That triggered a crisis at the company that led Streamnation to shut down its media hub service the following month. Benassay's next task was to find a home for Picturelife, whose 220,000 subscribers had stored 200 million photos and videos on the service.

The photos and videos were housed at a data center to which Benassaya paid a monthly fee. When Picturelife began running out of cash, the data center instructed Benassaya to remove all the files within 60 days. He used his personal funds to keep the files safe. "I had a moral obligation to save those pictures," he said.

This summer, Benassaya moved the 200 million files onto one-third of the server space that they previously occupied. "This created a huge mess in the photos," he said. "We moved the photos faster than we were able to update the database. But the pictures were there."

He contracted a firm to find a permanent home for Picturelife. SmugMug agreed to take them on. In the next few days, subscribers will receive information about their options. They can download all their photos from SmugMug, which has already imported all of PictureLife's files. Or they can choose to pay for SmugMug's service. They will have 14 days to decide, Benassaya said.

I asked Benassaya whether he still thought there was a market for a consumer cloud storage company. "Google Photos and Amazon — they took a huge chunk of that," he said. "And I think it's going to increase over time.

"Yes, there is a business. Is there a business for a small player? I don't think so any more." He laughed. "I'll let another brilliant entrepreneur think about that."