AI Strikes Again – Getty Images Heads For Chapter 11 Bankruptcy

Getty Images’ photo, video, and illustration licensing business to news outlets, advertisers, and businesses faces a quick death from AI.

Chatbots let users create visual content at a fraction of the cost of licensing, and Getty shares have collapsed since ChatGPT’s launch in late 2022, coinciding with a surge in AI news coverage and the growing adoption of chatbots for professional and personal use.

And now, Bloomberg reports that Getty plans to file for a prepackaged Chapter 11 restructuring in the coming weeks after securing support from major creditors and commitments for up to $533 million in new equity.

Getty family members and Koch Equity Development affiliates will provide the equity investment as part of the restructuring support agreement. The company expects to complete the restructuring by year-end.

The outlet noted that holders representing 83.5% of Getty’s unsecured bonds have agreed to retire $270 million of outstanding senior unsecured notes, reducing the company’s debt burden.

Investors holding about 89% of its secured bonds and term loans, along with all revolving credit facility lenders, have agreed to lower interest obligations and extend secured debt maturities.

The new deal will let Getty keep afloat, backed by $143 million in financing… but for how long?

Beyond Getty, Shutterstock has likely felt the pain from AI-generated images and video, which could replace stock-content purchases and pressure licensing prices. Adobe Stock also faces substitution risk. 

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