Getty Images launched rights-ready pricing in 2006 in order to meet customer demands for “simpler, faster licensing.” Now, the company has discovered that “customers also want to maintain their ability to very precisely fine-tune their licensing.”
Translated, this means: while rights-managed customers wanted cheaper prices and more flexibility in how they could use the images for large uses (which rights-ready gave them), they also want to be able to negotiate much lower prices for small uses.
As a result, Getty has decided to retire the rights-ready pricing model. All rights-ready images will become rights-managed by the end of February. Getty plans to deal with the simplification issue through “improved flexible license packs.”
As I pointed out when rights-ready licensing was first introduced in August 2006, the flaw of the strategy was that it provided only one price for a certain type of use. For example, if a customer wanted to use an image for printed marketing material, the price was a flat $750, regardless of image size or circulation.
In cases of large-scope uses, where the rights-managed price would exceed $750, the lower rights-ready price obviously made customers happy. However, for small uses, the price may be lower; the customer would be a fool not to try to find a cheaper rights-managed image. Because Getty was losing so much on top-end sales, its management had to bet that customers who normally paid $350 or $500 for rights-managed uses would pay $750, because they loved the rights-ready image so much.
This did not happen. The customers were smart enough not to fall for this ruse. Customers happily took the rights-ready price when it was to their advantage, but went somewhere else when it was not. Either way, Getty and its photographers lost.
Getty probably found that more customers complained about the high costs of rights-ready images than those thanking the company for making the licensing process simpler, easier and cheaper.
In September 2007, I suggested a modification to the rights-ready model that retained much of its simplicity, while still making it possible to establish or negotiate lower prices for smaller uses and set the prices for large unlimited uses somewhat higher, if desired. (Available here as a PDF download.) This recommendation did not gain much traction.
The fact that Getty is reversing a recently introduced strategy is interesting. Whenever Getty announces something new, even when it does not appear to benefit photographers, their reactions typically go along the lines of, “They are big and successful; they have a lot of smart people working for them; they must know what they are doing.” There is no question that, over the years, Getty Images has made a lot of smart decisions, but not every move is successful. Photographers should maintain a healthy degree of skepticism.