Not a Pretty Picture

TechFlash reports: Ontela is in talks to acquire Photobucket, with TechCrunch reporting that the deal will value the News Corp.-owned online photo community at a fire-sale price of $60 million. As part of the deal, Steamboat Ventures—the venture arm of the Walt Disney Co.—is said to be putting $40 million or more into Seattle-based Ontela with the bulk of that capital going to fund the purchase of Photobucket.

Dan Shapiro, the chief executive of Ontela, declined to comment on the report this afternoon but did say that his company does a lot of business with Photobucket. The companies announced a partnership earlier this year, one in which Ontela allowed camera-phone users to automatically have their images uploaded to the Photobucket website.

The service, which was developed in conjunction with Verizon, costs $2.99 per month.

TechCrunch's Michael Arrington said the acquisition is all but complete, and Rafat Ali at paidContent.org said that talks are happening between Ontela and Photobucket.

In addition to Steamboat Ventures, Ontela has raised capital from Voyager Capital, Hunt Ventures, Ericsson, Oak Investment Partners, and others.

News Corp.'s MySpace unit acquired Photobucket two years ago for $250 million, but TechCrunch reported last week that the photo community (now with 54 million unique visitors) has been on the auction block.

If the acquisition goes through, Ontela could emerge as a new player in the consumer online-photo business. Until now, the company has pretty much acted as a technology-tool provider, working with companies such as Alltel, T-Mobile, and Verizon to help their customers move photos from camera phones to hard drives on personal computers or photo-sharing sites.