Photo Co. Back on the Web

T he Web site for photo company PhotoPoint Corp. is back online, after abruptly shutting down last week.

A spokesman for the company said he hopes to have a public announcement “in the next day or two” that will answer questions about the future of PhotoPoint and its Web site,

The shutdown comes at a time when many of PhotoPoint’s competitors are struggling. A number of online photo sites have refocused their business models away from consumer services. Some have been acquired and others have ceased operations completely.

PhotoPoint is one of the most popular online-photo services, according to several Web-ratings organizations, with more than two million registered members and roughly 50 million photos stored and available for display.

PhotoPoint didn’t give members any warning about the shutdown, which started at about 3 p.m. EDT Thursday, July 12. As of late Monday, the company hadn’t provided users with any information about the resumption of service.

PhotoPoint is one of several companies that provide photo-hosting services for people selling items on eBay Inc.’s (EBAY) Web site. An eBay spokesman said the San Jose, Calif., company received “some complaints” about PhotoPoint going offline. “Most of the people were just trying to figure out what happened,” he said, adding that eBay wasn’t successful when it tried to reach PhotoPoint with e-mails and phone calls.

Changing Focus

Launched in 1998 as a free consumer-oriented site, PhotoPoint has recently begun changing its focus to business services. In mid-May it began charging members to store and share their photos.

Dale Gass, chief executive officer of Pantellic Software Inc., said “there are ongoing negotiations, but I’m not at liberty to say anything until we close them.”

Pantellic, a closely held Halifax, Nova Scotia, Canada, company, started the PhotoPoint site in late 1998. A year later, PhotoPoint Corp. USA was launched with about $11 million in venture-capital funding from investors including US Venture Partners, Softbank Venture Capital and Entertainment Media Ventures.
Following the launch, Pantellic sold PhotoPoint’s intellectual property — its domain name, Web site, source-code content and membership base — to the San Francisco-based U.S. company, but continued to provide Photopoint with Web and software development and hosting services.

When the PhotoPoint site went back online around 4 p.m. EDT Monday, July 16, the “About Us” section of its Web site said the company is now based in Halifax; and a source close to the company confirmed that the San Francisco office has been closed. Pantellic’s Mr. Gass said he couldn’t comment on the change or the current relationship between his company and PhotoPoint.

This past January, PhotoPoint received an additional $16 million in a funding round led by Softbank Venture Capital and US Venture Partners that included corporate money from Sun Microsystems Inc. (SUNW) and Epson America. At the time, Ed Bernstein, PhotoPoint’s chief executive, said the new money should enable the company to achieve profitability some time this year. Mr. Bernstein couldn’t be reached for comment and his current status with PhotoPoint couldn’t be determined.

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