The Global Stock Image Market Research Group (GSIMRG) in Heidelberg, Germany has just released a
report on the extensive study of the stock photo industry that it conducted in 2012. This report is a must read for anyone engaged in the stock photo business.
The authors identified 2439 firms worldwide that were engaged in the licensing of stock imagery and contacted them with a questionaire. 250 responded in various degrees of detail providing the most comprehensive set of data ever collected on this industry.
Based on the available data the authors have concluded that in 2011 the stock photo industry as a whole generated
$2.88 billion in revenue. I disagree with their conclusion and will explain my problems with it below. Only 139 of the respondents supplied detailed gross sales data. Thus, the authors were forced to extrapolate from this data to arrive at a total industry figure. I think the judgments they made in their extrapolation of the data has some flaws, but this does not take away from the extreme value of the raw data that is detailed in the report.
While the authors identified 2439 firms they concluded that given the considerable degree of volatility in the industry through mergers, acquisitions and firm closures 20 percent of these firms may have ceased doing business. Thus, they corrected their data to assume that only 1,950 firms were operating in 2011.
The next important step is to determine how many firms fall into the categories of Large, Medium, Small and Micro as defined in the European classification of firm sizes. Large firms have more that 250 employees or have gross revenue in excess of $60 million. No firms of this size responded to the survey, but the authors concluded that there are four – Getty Images, Corbis, Shutterstock and Fotolia that fall into this category. Based on publicly available data and in certain cases estimates they concluded that these 4 firms alone had a combined gross revenue of $1.4 billion. I agree with this conclusion.
The next group is Medium sized companies that have 50 to 249 employees or revenues between $14 and $60 million. Nine of the respondents fell into this group and the median revenue was $15 million. Certainly some of these firms had less than $14 million in gross sales. The authors came to the conclusion that there were 12 firms worldwide that fall into the Medium category based on size and that the total revenue for this group was $156 million. I agree with this analysis.
This accounts for 16 organizations. The other 1934 are categorized as Small or Micro and within each of these groups there are 2 divisions. In Micro there are those with 0-1 and 2-9 employees. In Small there are those with 10 -24 and 25-49 employees. My major disagreement with the author’s extrapolation is in the number of firms assigned to the Small group.
A total of 38 of the survey respondents with an average revenue of $3.16 million and a median revenue of $2.6 million fell into this group. 13 of the responding companies had more than 25 employees and the rest had between 10 and 24 employees. The authors concluded that there are 397 firms worldwide with more than 10 employees. Based on my experience I can’t believe there are more than 150. Many of the companies that attend CEPIC and PACA conferences have fewer than 10 employees. I believe that a higher percentage of the companies that fall into this group on the basis of the number of employees would have been inclined to respond to this survey than those with 9 or fewer employees. Companies in this group are in a position to really use the data such a survey could provide.
The authors concluded that their 397 firms generated $1.033 billion in revenue. My 150 companies would only have generated $390 million.
Seventy-seven percent, or 151 of the respondents, had fewer than 10 employees with 44 having 0 to 1 and 107 having 2 to 9 employees. The average revenue for the 2 to 9 employee group was $272,000 and the median was about $250,000. The maximum revenue a company in this group could earn is $2.4 million and certainly a few might have earned in the $1 million range, but certainly many companies with so few employees are earning less than $272,000. I am not surprised at this average for companies of this size.
Of the Micro companies that responded to the survey 44 or 29% of the respondents had one or fewer employees. Their average revenue was $35,000 and the median revenue was $40,000. They are certainly companies that represent only 1 or very few photographers.
Given that I have assigned 166 of the 1950 firms to the Large, Medium and Small categories there are 1784 left for the Micro category. It seems reasonable to assign 30% or 535 to the group with 0 to 1 employees and the remaining 1249 to the 2-9 group of employees.
At a $35,000 average the 535 firms would generate $18.725 million and the 1249 firms at $272,000 average revenue would generate $339.728 million for a total of $358 million for the Micro group.
| |
Millions |
| Large |
$1400 |
| Medium |
$156 |
| Small |
$390 |
| Micro |
$358 |
| |
|
| Total |
$2304 |
A survey at the beginning of 2012 by ACSIL indicated that stock footage sales were
$394 million. The Global Stock Image Market Research Group GSIMRG came up with a much lower figure. However, since they didn’t have any figures from the major footage distributors – Getty and Corbis – it is hard to put much stock in their numbers. Another problem with determining footage use is that many of the major suppliers are motion picture companies and TV networks. We would need revenue information from the footage divisions of these organizations to determine actual footage sales. I doubt if these organizations were approached, or counted, in GSIMRG survey, but they were included in the ACSIL survey. I will subtract $200 million from the ACSIL figure above so we only account for the footage share of the companies considered in the GSIMRG survey.
If we are interested in determining the size of the imagery and illustration market we need to also subtract revenues that some stock photo companies earn from other lines of business. For example, in 2007
Goldman Sacks estimated that 17% of Getty’s 2012 revenue would come from sources other than image licensing. Getty had gross revenue of $945 million in 2011. If the percentage for “other sources” holds true that would be $160 million. For Getty "other sources" include music licensing, digital asset management and photographer assignments among other things. Corbis makes a significant amount of revenue from rights clearance deals, photographer representation (for assignments) and media management (digital asset management). To get to just the image licensing segments of the revenue these businesses generate I think it is conservative to subtract another $200 million from the gross figure.
Next we must consider double counting of revenue. Today, nearly every agency has many distributor relationships. Some agencies have as many as 200 other agencies licensing rights to their images. In the GSIMRG survey 104 agencies indicated that $94 million of their revenues came from direct sales to image users and $40.6 million, or 30 percent of total revenue, came through intermediate sales with their partner agencies. Many of the smaller agencies that didn’t respond to the survey will have a much higher percentage of total sales coming from partner agencies. On the other hand a much higher percentage of Getty and Corbis sales are direct to image users, although both companies do generate some portion of their revenue through partner arrangements. Again, to be conservative I will subtract 20 percent for double counting rather than 30 percent. That total comes to $380 million.
| |
Millions |
| Gross Revenue |
$2304 |
| Reductions in Gross Fee |
|
| Footage |
$200 |
| Non-Image Revenues |
$200 |
| Double Counting |
$380 |
| |
|
| Total Reductions |
$780 |
| |
|
| Net Image Revenue |
$1524 |
This would leave
$1.524 billion in sales of still images, illustration and footage. About $200 million of that is footage.