Book Publishing Prices: When Will We All Wake Up?

The book publishing industry has changed dramatically in the last decade or so and the stock photo industry has struggled to keep up with those changes. The biggest problem has been in establishing reasonable prices for increased circulation.

As late as the early 1990s, most textbook license requests were for 1/4 page under 40,000 print runs. The 1995 edition of Negotiating Stock Photo Prices listed the price for this usage at $200. Back then, it was also common to get reuse fees when a book was put back on press for a new print run. Re-use fees were 75% of the "current" fee for the same usage, not 75% of the lower initial fee charged.

At that time, getting a picture accepted for printing in a popular book was like an annuity. Every year or so, the photographer received a request to re-license the image for another printing. Photographers were willing to license the initial use for relatively small fee compared to other uses, since they would make money on future re-uses.

For example, I shot a picture of H.R. Haldeman as he was being sworn in during the Watergate hearings. This picture was used in a history textbook, and the book was reprinted many times. I received seven or eight fees over more than a decade.

Then digital printing arrived. Suddenly, short-run books were economic to produce. Custom changes and a variety of variations of a single basic title became common. That caused publishers to want rights upfront to print lots of versions of a title, including electronic versions, without having to re-license each time.

Consequently, we started seeing requests for licenses of 500,000; 1,000,000 and 1.5 million. Nothing wrong with that in principle, but what should the fee be?

One approach: a $200 fee for 40,000 would be $0.005 per book. Multiply that by the number of books, say 80,000, and you get $400. Give a little discount for the second 40,000.  Make it $350 for a total of 80,000 books. That's basically the 75% reuse fee that sellers were getting before.

But look what happens when the press run goes to 400,000. The fee for that use would be $2,000 and even if we knock off 25% for reuses, that is $1,500. Seems like a lot of money. But not really, if we compare it to what the fee would be for ten 40,000 print runs two decades ago. We're not touching cost of living increases here.

It is also important to remember that these big circulation licenses are usually for 10-year periods, and the price publishers charge for books is likely to rise significantly during that period. According to the Bureau of Labor Statistics Producer Price Index, between 1994 and 2004, the wholesale prices of textbooks jumped 62%. Gross revenue in 2005 for elementary, high school and higher education books sold in the U.S. was around $10 billion and growing at a rate of around 4% per year, according to the Association of American Publishers.

The National Association of College Stores says the average price of a new textbook in 2006 was $53, but some books are priced over $100. There is a real disconnect between what books cost and the amount photographers are being paid for the pictures included.

Much higher multiples should be charged for higher circulations.

Problem: High Circulations Prices

For 1/4 page, North American, English language for 40,000 copies printed over five years Corbis charges $280. For 10 years, it is $350. These are not bad prices for a 40,000 print run. But the problem arises when all that additional circulation is added. Below are the multiples that Corbis charges for various higher circulations. Take note: Corbis' rates are better than most.

Given these costs, the pictures in books certainly aren't valued at much. The amount paid for pictures has gone down as the cost of books has gone up. If the big guys in our industry aren't going to try to hold the line on usage fees, there isn't much hope for the rest of us.