2/27/08

Shutterfly Gallery Launches to Inspire and Engage Storytellers

Don Davis , Editor in Chief

Company Unveils Social Network to Help Customers Inspire Each Other with Their Stories Introduces First-of-Its-Kind ``Make One Like This`` Feature for Quick Photo Book Creation

REDWOOD CITY, Calif., Feb 20, 2008 -- Shutterfly, Inc. (NASDAQ:SFLY), the leading Internet-based social expression and personal publishing service, announced today the launch of Shutterfly Gallery, a new community platform for sharing and connecting with others. At the outset, this new Shutterfly social network will leverage the power and enthusiasm of the viral Shutterfly community, allowing customers to creatively inspire one another by sharing their photo books online and exchanging comments about their experiences. To learn more about the Shutterfly Gallery, please visit http://community.shutterfly.com.

"Shutterfly Gallery adds the power of social networking to our vibrant community and marks the next great chapter in establishing Shutterfly as the industry leader in storytelling," said Jeffrey Housenbold, president and chief executive officer of Shutterfly. "Our customers are inspiring and enthusiastic storytellers and have asked for a way to share their stories with other customers and the general public. Now, we are providing them more ways to tell their stories -- both via group collaboration capabilities through our recent acquisition of Nexo Systems, and in Shutterfly Gallery where they can electronically share their beautifully-designed personal photo books, further proving the unlimited flexibility of our personal publishing platform."

According to IDC, 70% of the US population uses the internet as part of their everyday routines, and 87% indicate they have used a social network. Shutterfly Gallery provides a virtual community destination for people interested in learning more about storytelling and sharing photo books in a trusted environment.

In a few simple steps, any storyteller can easily be a part of the Shutterfly Gallery community. Members can introduce themselves by personalizing an online profile complete with their favorite picture, unique username and a personal description.

Shutterfly Gallery members can post their photo books, share their thoughts and perspectives on storytelling, add photo books to their "favorites" list, rate and comment on other photo books, and share interesting Gallery projects with friends and family with the "email a friend" feature. To expand sharing beyond Shutterfly.com, photo books posted to the Shutterfly Gallery can also be embedded into a personal webpage or blog.

Shutterfly is also making it even easier to create photo books in less time with the introduction of "Make One Like This," a unique new feature that allows customers to "copy" posted photo books and use the designs as templates for their own personal creations. Customers can select their favorite book and choose the "Make One Like This" feature, which will preserve the look and feel of the book design while removing the original photos and text. Customers can then add their own text and photos.

"Shutterfly Gallery is another great example of how Shutterfly is continuously innovating to meet our customers` wishes while keeping a disciplined eye towards business results," added Kathryn Olson, chief marketing officer of Shutterfly. "The initial response from our community has been very positive -- thousands of books have been posted by our passionate customers and tens of thousands have been viewed. Consumers are flocking to the Shutterfly Gallery to share stories, to discover and comment about themed books, and to build their own unique photo books."

Moderated by a community manager, Shutterfly Gallery is divided into 16 occasion-based categories for easy photo book browsing. Additionally, visitors can quickly and easily view books by category, book size and other filters such as "most popular," "most commented," and "most copied" to get inspired to create their own books.

About Shutterfly

Founded in 1999, Shutterfly, Inc. is an Internet-based social expression and personal publishing service. Shutterfly provides high quality products and world class services that make it easy, convenient and fun for consumers to preserve their digital photos in a creative and thoughtful manner. Shutterfly`s flagship product is its award-winning photo book line, which helps consumers celebrate memories and tell their stories in professionally bound coffee table books. More information about Shutterfly (NASDAQ:SFLY) is available at www.shutterfly.com. Shutterfly and Shutterfly.com are trademarks of Shutterfly, Inc.

Shutterfly, Inc.

Marilyn Lattin, 650-610-5853 (Investor Relations)

mlatting@shutterfly.com

Bridgette Thomas, 650-610-3519 (Media Relations)
bthomas@Shutterfly.com

Topics:

business finance, Entertainment Culture, Mass media, Technology, Technology Internet

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