Recently several subscribers have asked questions, the answers to which might be of interest to all subscribers. So I’ve decided to share the questions and my answers here.
Q -
What is your analysis of the photo market at of the end of 2012? Where is it going?
Jim - The photo market is going down hill fast. There are too many good images available. The number of buyers, or their needs, is not growing, particularly for print uses. The odds of any image being licensed are much less than they were a few years ago. Prices will continue to fall, particularly for RM.?
Q –
I have always been (over 20 years) a non-exclusive RM travel shooter. Should I consider making some RF submissions in both traditional agencies (Alamy) and Microstock agencies (iStockphoto, Shutterstock, etc)?
Jim - Absolutely! All you have to do is look at the numbers. I believe there were no more than 1.5 million RM uses licensed worldwide in 2012. There may have been as many as 3 million uses licensed from traditional RF sources. There are in the range of 125 million microstock licensed.
On top of that we believe that in the range of 25% of the images licensed by Getty last year were for fees under $25. And something in the range of another 30% were for fees between $25 and $100. The same is happening at all the other agencies. Often the price charged for an RM image use is less than what would be charged to use a microstock image. We are rapidly approaching the point where it will cost less to license an RM and traditionally priced RF image for most uses that it costs to license a microstock image.
I believe that right now, on average, the revenue earned from 4 to 5 microstock sales will equal the revenue earned from one RM sales. Sure, there will continue to be occasional RM sales that generate huge returns, but there won’t be enough of them to make up for huge number of small sales and the low number of units licensed overall.
Q –
Which microstock sites should I consider?
Jim - The number one is Shutterstock. After that I would submit the same images on a non-exclusive basis to Fotolia, Dreamstime, iStockphoto and 123RF. Don’t go exclusive with anyone. Check out
MicrostockGroup.com for more information about which agencies are doing the best.
iStockphoto is having some serious problems due to Getty’s management so I definitely would not go there first. Check out this
story. Given the current environment microstock is the way to go, but you will never earn the kind of money you used to earn as an RM shooter.
Q -
In our electronic era, is it still appropriate to publish color photos in print-on-paper travel books?
Jim - If you are talking about licensing rights to a publisher to use your images the answer is Yes if the fee they are willing to pay is reasonable. If your worry is that your images might be scanned and stolen there is nothing you can do to prevent that if you show your images anywhere, either in print or online.
If you’re talking about sell-publishing a book, my guess is – and I have no statistics to back this up – that it will be very difficult to sell enough travel books to make a profit. These days I would think there is a declining demand for travel books because travelers are able to get so much of the information they need online. I would be interested in any statistics that would disprove this theory.
Q -
What percentage of photos used are actually licensed vs obtained from free sources?
Jim – There is no way to determine how many photos are being used in the world, how many were produced on paid assignments, or how many were produced by the individual that actually used the image. Thus, there is no way to determine a percentage of photos licensed from stock photo sources relative to the total number of images used.
That said, clearly a huge percentage of the images used on the Internet are not properly licensed. Picscout (a Getty Images company) searches “professional Internet sites” for images represented by stock photo companies that use its service. 85% of images they find have not been properly licensed and their searches do not include all the non-professional sites on the Internet.
One of the problems professional photographers face is that of all the images found on the Internet only a minute percentage require licensing. The vast majority are available for free use or require a link or a credit at most. Thus, the vast majority of the population thinks that anything they can find on the Internet is free.
Unauthorized use is not just an Internet problem. There are a significant number of images being used in print by major publishers without proper licensing. Check out this
series of articles.
Q –
How can I substantiate the fact that Getty Images is the market leader in revenue in the rights managed aspect of the industry?
Jim - Yes, Getty is still the market leader with probably something in the range of $100 to $120 million in RM sales from their Creative Stills collection last year. This does not include sales made by the Editorial Division. Some editorial images are licensed as RM, but a high percentage of the uses result from subscription sales.
But just because they are the “leader" doesn’t mean it’s a good business model. See “
Decline In Licensing Fees At Getty” In 2007 Getty’s RM sales were over $300 million and they have been sliding downhill ever since. The #2 RM licensor is probably Corbis but their revenue is unknown. At #3 is Alamy with less than $23 million in sales in 2011. (See
here.) Also see
"Do More Images Result In More Revenue?"
Q –
Is TAC (Getty’s “The Agency Collection”) the place to be even if I have to give up licensing a lot of similars produced on the shoots from which TAC images are selected?
Jim - From what I hear TAC is no longer the "darling of the industry." When Getty first launched TAC in September 2010 they pushed the images high in the search return order on the iStockphoto site. For a while the average RPI per year for some of the early images exceeded $1,000, an unheard of number.
But then customers started leaving iStock because they assumed everything on iStock was expensive and sales overall fell dramatically. (See
"Downloads At iStock 56% Lower Than 2010") To make lower priced images easily available to customers Getty pushed TAC images down in the search return order and TAC sales dropped dramatically. It is my understanding that now it is very difficult to get new contributors to put images into TAC.
Getty may change the search return again. They may accept that they've simply lost a lot of iStock customers that will never return because they have the impression that iStock images are too expensive. The ones that stay are willing to pay the higher prices for what they perceive are better images. Whether or not TAC is the place to be in the future depends on what Getty does with the search return order, and whether there is any way to depend on them being consistent. It also depends on the number of images that must be held back from offering through other sites.
I don't know how long the images from my
list of TAC contributors have been on the site, or when the downloads came, but overall the average is 1.5 downloads per image in file over a two year period. That doesn't seem like a very good return on investment. My guess is that you’ll probably earn more from non-exclusive images distributed through many outlets worldwide.
Getty has some tough decisions ahead. Will they focus on going after those customers that are willing to pay higher prices and accept that they will lose a lot of customers that are unwilling to pay such prices? Or will they go after volume – cut prices and keep prices low – to try to keep from losing more customers? Will they adopt the same strategy for both Getty Images and iStock, or will they adopt different strategies for the two different market segments? Finally, whatever they do, will they adopt a consistent strategy that suppliers can depend on, or will they vacillate back and forth in an unpredictable manner so no one knows where they will be next?