I've written about so many business models that have been improved due to challenges from the Internet that I'm too tired to go back and link to them all. But my buddy, Raman, points out yet another and I cannot resist sharing its success story.
If you're a parent you know that the cost and process of school pictures is absolutely unreasonable, and there's been little you can do about it. The schools are pressured to contract with one of the handful of large national conglomerates that control the cost and hire local photographers at a poor rate. As parents, you have the choice to pay a boatload or NOT get a picture of your child (yeah, right). Meanwhile, every year our cameras get better and cheaper.
Finally, someone has taken the opportunity to add challenge and improvement to the market. A company called Picateers, started by Larry Jacobs, a former manager at Oracle and IBM, created a business model in which local amateur photographers take the pictures and upload them for parents to view and select. Prices are about the same, but this is allowing for more events to be photographed, and Picateers sends 50% of proceeds back to the school, versus about 15% for big guys like Lifetouch.
We'll see if Picateers is able to break the market open. So far it has gotten $5.5 million in VC funding and has a presence at 300 schools. The overall market for school photographs is $2.2 billion, so there's some room for a small player like Picateers to improve this stagnant market for the first time in decades.