Tom Grill recently offered Selling Stock readers his predictions on where the stock photo business is headed in the next five year. While I agree with a lot of what he had to say, I believe the vast majority of photographers will find stock offers much less of an opportunity than the picture he paints. In the next five years, it will become increasingly difficult to earn a decent living—or even a profit—from producing still images on speculation.
Remember, profit is defined as revenue earned minus expenses and time invested to produce the product. There will always be a handful of photographers who are exceptions to the rule and buck the trends, but there will be fewer of them.
| Between now and 2015, there will be a continued decline in the gross revenue generated by the licensing of stock images. This will occur regardless of whether, or how, the U.S. and world economies recover. In addition, many more people will produce and try to license stock images. As a result, the average shooter will earn much less from stock than is the case today. |
Between now and 2015, there will be a continued decline in the gross revenue generated by the licensing of stock images. This will occur regardless of whether, or how, the U.S. and world economies recover. In addition, many more people will produce and try to license stock images. As a result, the average shooter will earn much less from stock than is the case today.
Very few photographers will be able to earn enough to support themselves from stock sales alone. Grill will certainly be one of the exceptions, but most others without his skill, years of experience and tremendous backlog of imagery will find stock photography a very unsatisfying business endeavor.
Some of the reasons for this decline will include:
- Use of printed products will decline. The vast majority of revenue generated from the use of stock images results from their use in print. More and more people will get the information they need from electronic devices, and any growth in image uses will be in the electronic environment.
- The rates paid for use on electronic devices will continue to be one-tenth or less of what publishers have paid in the past to reach the same number of customers in print. Given the abundance of images illustrating similar themes, magazines will increasingly cut back on the rates they are willing to pay for stock images.
- Publishers will deliver their products in multiple ways on multiple devices. Publishers will insist on being allowed to use images in both print and on many electronic devices and they will resist paying any more for these extra uses than they currently pay for print use alone.
- It will become virtually impossible to price stock images based on use. Imagery needs will become more complex given the wide variety of devices where the publisher plans to use the images. In some cases, the publisher will need a strong key illustration; in others, it will be sequences. For the most part, these images will need to be shot on assignment. There will be less need of generic images and more for those that relate specifically to the subject of the story or ad.
- Publishers will discover that they need to approach the project in an entirely different manner when designing for both print and electronic uses than when the project was for print use alone. Many stories will require text, audio, video and extensive still coverage. More collaboration and team efforts will be required. More projects will be shot from scratch as assignments and there will be a declining demand for stock.There will be more pre-planning of the entire package to insure that all the elements fit together and support each other. When that happens, there will be less demand for stock.
- Because the ability to measure the effectiveness of various advertising methods will continue to improve, advertisers will spend less on print and more on various electronic methods of delivery—and more on search advertising. Advertisers used to pay high prices for magazine and newspaper ads because they had no other option. Now they have choices. It is easier for advertiser to measure results when using electronic devices to deliver their message. They will quickly learn that they can often get better results for less money from electronic ads than can from print.
- As advertisers come to understand how ineffective much of their print advertising has been, they will cut back on yet another segment of it. Advertisers will be unwilling to pay the high fees they have paid in the past for much of their advertising.
- It will become extremely difficult to charge enough for still images to justify producing them on speculation. This will be a problem not only for rights-managed sales, but also for royalty-free, because the prices customers will be willing to pay for royalty-free uses, even when licensed in volume, will not adequately compensate image creators for their costs.The only way photographers will be able to get a reasonable return for the time and resources invested will be to work on assignments where there is a guaranteed payment.
- A high percentage of the stock images purchased will be produced by amateurs who will be willing to accept any compensation offered even if it is insufficient to cover costs.
A recent 24/7 Wall Street/Harris Poll of 2,095 U.S. adults found that 55% believed traditional media as we know it today will disappear in 10 years. 43% said the day of the printed newspaper is past. More than half of those questioned said they already get their news via digital delivery, and 66% of the 18 to 34 age group said they rely solely on digital devices for their news.
According the Newspaper Association of America, there were more than 100 million unique visitors to newspaper Web sites in September—but news producers still have not figured out how to get people to pay for it.
Revenue for The Associated Press is declining rapidly. In 2008, the AP earned $220 million a year from U.S. newspapers. Now that is down 37% to about $140 million and expected to decline another $5 million per year for some time to come. Current sales of U.S. newspapers only represent about 20% of AP’s total revenue.
Stars and the rest of us
Tom Grill and I agree on a number of points. A few top-echelon stars will continue to do well, but only a very small percentage of the total work needed will be produced by this group of photographers. Many customers will be able to get the images they need for less than it costs to produce them.
Perhaps photographers should never give up aiming to be one of the successful stars and not concern themselves with the plight of the average, or even above-average photographer. The non-star photographer may work hard, produce a quality product at a reasonable price, and still never reach the pinnacle of success in his or her chosen career. Drive, determination and photographic talent are often not enough today. Luck and tremendous marketing and self-promotional skills are also needed.
Both Tom and I agree that creators need to adapt to a changing business environment, but we differ on how they should adapt. Tom talks about new cycles occurring as a result of new inventions or discoveries. The new discovery is electronic delivery of information—in particular, delivery on tablets. The transition from print to tablets will create demand for a different type of imagery created in a different way. No one is sure where the money will come from to compensate creators for their efforts. (Check out this story on Followthemedia.)
| I am more concerned about those talented workers in the mid to upper levels of the profession who will never reach star quality and whose timing, unfortunately, happens to be near the end of the life cycle of stock photography. I hope these articles give them something to think about. |
Tom believes that “the time, effort and expense to do assignments will mostly limit that luxury to the higher-end products and marketing campaigns.” If that is the case, then I would think that would reduce the high-end market’s need for high-production-value stock. In the past, high-production-value images also sold in reasonable volume for lower budget, less important projects. Now, many of those low budget sales will go to lower-cost microstock or the sellers of the high-production-value images will need to dramatically cut their prices in order to compete. In all, I do not see price and volume holding up for high-production-value shooters.
It seems to me that a big difference between Tom and myself is that Tom is pointing to the opportunities for the stars and outlines what is needed to get there. I’m a photographer who, like many, at one time hoped to be one of the stars. Yet I never achieved anything near star quality. I earned a decent living as a photographer and satisfied the needs of lots of clients. My success resulted as much from the accidental timing of my career as from talent. I am more concerned about those talented workers in the mid to upper levels of the profession who will never reach star quality and whose timing, unfortunately, happens to be near the end of the life cycle of stock photography. I hope these articles give them something to think about.