Every photographer is aware that the average annual return-per-image has been steadily falling over the last few years. It is interesting to consider how much.
In November 2003 when Getty Images was a public company I started tracking Getty’s return-per-image by dividing the total number of RM and RF images in their Creative (now called Premium) collection into the total revenue generated in the previous four quarters.
This was relatively easy to calculate through 2007 because Getty reported gross revenue generated by each of these collections on a quarterly basis. After the company was purchased by Hellman & Friedman gross revenue were no longer reported publicly. Thus it became impossible to continue the calculations.
Recently, we have learned from debt investors that the average gross revenue generated by the Premium collection in the last four quarters was around $300 million. I have made an assumption that half the revenue ($150 million) was generated from the licensing of RM images, and the rest from RF since this was roughly the breakdown in the period between 2003 and 2007.
To determine the number of images in the collection I made the assumption that every image in the collection has a single orientation – horizontal, vertical, panoramic or square. Searches for each of these orientations reveal that currently there are a total of 7,057,125 RM and RF images on the site. If there are images in the collection that do not have orientation keywords then the total may be higher.
From the chart below we see that there are 3,436,910 RM images and 3,620,215 RF for at total of 7,057,125 images in the collection. The average total revenue generated by each of these images is
$42.54. It should be noted that actual royalty share each photographer receives will be lower depending on the photographer royalty percentage.
| Average RPI |
|
|
|
| Year |
Rights Managed |
Royalty Free |
Combined RM & RF |
| 2003 |
$775.29 |
$652.58 |
$732.87 |
| 2004 |
$673.54 |
$634.63 |
$659.25 |
| 2005 |
$413.19 |
$558.02 |
$464.13 |
| 2006 |
$332.83 |
$319.73 |
$327.00 |
| 2007 |
$270.37 |
$332.98 |
$298.57 |
| |
|
|
|
| 2013 |
$43.64 |
$41.43 |
$42.54 |
| |
|
|
|
| Number Images |
|
|
|
| 2003 |
346,091 |
189,523 |
535,614 |
| 2004 |
434,346 |
252,161 |
686,507 |
| 2005 |
751.495 |
404,016 |
1,155,511 |
| 2006 |
973,933 |
787,281 |
1,767,214 |
| 2007 |
1,174,692 |
964,227 |
2,138,919 |
| |
|
|
|
| 2013 |
3,436,910 |
3,620,215 |
7,057,125 |
Back in 2003 the average revenue generated by each image in the collection was $732.87. Thus, today Getty would have to license rights to
17.23 images to generate the same revenue as they earned from one image license back in 2003.
The low average price wouldn’t be so bad if total images licensed were 17 or more times greater than in 2003, but clearly that is not the case. Getty’s revenue from the Premium collection has dropped from $561 million in 2007 to $300 million in 2012 indicating that any increase in units licensed has only make up for about half the price decline.
Photographers have found that the only way to keep their revenue relatively stable has been to massively increase production. Because of the overproduction, and a great increase in the number of photographers supplying images, most professional photographers who have been around for a while have seen a substantial decline in their income.
Shouldn’t Photos Be Cheaper Due To Technological Improvements?
Improvements in camera technology have certainly made it easier for people to take good pictures. The development of the Internet has made it easier for the masses to make their images available for licensing.
But, if anything, once an image is captured the time required to make it available for licensing has increased, not decreased. It used to be that photographers would deliver their raw film to an agency. The agency would edit, caption and keyword if necessary and make the image available for licensing.
Now, extensive post-production – color correcting or adjusting – is often desirable. Image creators are responsible for keywording and uploading their images to the online databases. Agencies used to do extensive editing and provide individually targeted advice and support that would help the photographer know what to shoot in the future. For the most part that has disappeared.
It is not uncommon for a photographer to spend four or five hours in post production for every shooting hour and that doesn’t include all the pre-production time necessary to determine what to shoot and where and how to shoot it.
It should also be noted that equipment costs – cameras, computer, software – have not decreased. Prices for individual items might have declined, but the need for more frequent updates and a greater variety of products have kept overall costs about the same, if not higher.
Thus, for the image creator the time required to do the job, and the overall cost, have not decreased in the last decade. If anything they have increased.
Competition
One of the reasons for the exploding increase in available images is that many amateurs and part-timers have discovered that they can participate in the market. Their goal is to have fun taking pictures and to make a little extra money, if possible. They don’t need to, or expect, to earn their living taking pictures. Their images are often of excellent quality.
After trying to sell their images for a while, many discover that the pre and post-production parts of the job are not as much fun as taking pictures and they drop out. But, the images they produced remain in the databases to compete with those of the people still trying to earn a living from their pictures.
Where Is This Likely To Take Us?
Overall more and more pictures will be made available for customer consideration.
Prices will continue to decline.
An increasing percentage of the available images will be produced by amateurs. These photographers will have no expectations of earning enough from their images to support themselves.
Photographers hoping to earn a significant portion of their income from licensing stock images will find it increasingly difficult to earn a profit from their efforts and will transition to other more productive ways of earning a living.
Fewer new images of subject matter that is expensive to produce will be added to the collections. Customers will be forced to use the same old images everyone else has used, or hire a photographer to produce something new.
Customers will continue to complain about the “quality” of certain imagery. The cost of producing such images will be prohibitive considering the prices customers are willing to pay and the volume licensed.
Editing will become more important, but site operators will be unable to justify the expense of editing given the prices customers are willing to pay. Customers will be required to expend much more effort to find the “right image” than is the case today.