Shutterfly 2015 Annual Report Download - page 19

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service kiosks for printing, and may, among other strategies, offer their customers heavily
discounted in-store products and services that compete directly with our offerings;
• Drug stores such as Walgreens, CVS/pharmacy, and others that offer low-cost photography
products and services as well as in-store pick-up from their photo website Internet orders;
• Traditional offline stationary companies such as PaperSource, Crane & Co. and Papyrus;
• Cloud-based storage services and file-syncing services such as Dropbox, Box, and Amazon Cloud
Drive;
• Specialized companies in the photo book, photo merchandise and stationery business such as
Hallmark, Cardstore by American Greetings, Minted, Invitations by Dawn, Picaboo, Blurb,
Mixbook, Zazzle, CafePress, Postable, and Artifact Uprising;
• Photo-related software companies such as Apple, Microsoft, and Adobe;
• Providers of digital alternatives to our product such as Paperless Post, Evite, Animoto and
PicCollage;
• Home printing service providers such as Hewlett-Packard and Epson that are seeking to expand
their printer and ink businesses by gaining market share in the digital photography marketplace;
• Enterprise digital and print communications companies such as RR Donnelley and Sons Company,
O’Neil Data Systems, Inc., Quad/Graphics, Inc. and Viatech Publishing Solutions, Inc.;
• Regional photography companies such as Ritz Camera that have established brands and customer
bases in existing photography markets; and
• Camera and photographic supply companies that rent equipment nationwide both online and in
brick-and-mortar stores such as LensRentals.com, LensProToGo, Cameralends, AbelCine, and
Adorama.
Many of our competitors have significantly longer operating histories, larger and broader customer bases,
greater brand and name recognition, greater financial, research and development and distribution resources, and
operate in more geographic areas than we do. Well-funded competitors and competitors that operate large-scale
businesses of which digital photography products and services are only an immaterial aspect of their overall
business may be better able to withstand economic downturns and periods of slow economic growth and the
associated periods of reduced customer spending and increased pricing pressures. The numerous choices for
digital photography services can cause confusion for consumers, and may cause them to select a competitor with
greater name recognition. Some competitors are able to devote substantially more resources to website and
systems development or to investments or partnerships with traditional and online competitors. Well-funded
competitors, particularly new entrants, may choose to prioritize growing their market share and brand awareness
instead of profitability. Competitors and new entrants in the digital photography products and services industry
may develop new products, technologies or capabilities that could render obsolete or less competitive many of
our products, services and content. We may be unable to compete successfully against current and future
competitors, and competitive pressures could harm our business and prospects.
17