View | Cape Hatteras National Seashore, North Carolina | Oct 2008

Digital Railroad today announces massive changes and restructuring that will likely lead to liquidation.

After Photoshelter closed their stock agency, Alamy decreased their revenue share with photographers (and is probably looking for a buyer), Corbis continued the industry layoffs and Getty sold their business to a private equity fund, Digital Railroad’s problems shouldn’t come as a surprise.

Digital Railroad’s problems have nothing to do with the current macroeconomic credit deleveraging and rebalancing; it’s about a dead business model, a reliance on old DNA, a failure to adapt to the industry’s fundamentally different balance of supply and demand of images, photographers and publishers.

What will the industry do? Instead of trying to sell images, we’ll probably see a continued focus on selling stuff to photographers.

What should photographers do? To start, photographers need to create new business models and take advantage of the opportunities to define their focus, expand their businesses and find and connect with fans and customers.

On that note, Lesson 4 of the series will be posted soon…