The Blockchain Fairy Tale

Blockchains are being touted as offering great future economic benefit for stock photographers. Photographers will be able to set the price for their work. No waiting weeks of months to be paid the photographers share of the sale. Once the image is licensed virtually 100% of the revenue will be transferred immediately to the photographer’s account. “Technology” has removed the need for middlemen and their costs. Blockchains will keep such great records on every transaction that consumers will be unable to steal without getting caught. Any unauthorized used will be immediately identified and the infringer will be pursued.

But will customers gladly pay whatever the photographer asks? Isn’t the Blockchain itself a middleman? Will pursuing infringers be that easy?

Here are 5 reasons why Blockchains may not be as beneficial as their developers make it sound.



1 – Strengthening Copyright. The only way copyright protection is strengthened is if the image is only available through a single blockchain source. If the image is available, or has been available in the past, through multiple agencies then the blockchain will have no record of those transactions. It will be very difficult to determine if any new use is unauthorized.?

Currently, there are at least 5 blockchain sources raising funds in the ICO (Initial Content Offering) phase of development. Which one will customers use? The data collected by one will not be known by any of the others. Putting the same images in every blockchain won’t solve the problem. If they are all searching the Internet for uses of the images in their collection, and discover an image that has been legitimately licensed by one of them, all the others will believe they have found an unauthorized use when in fact it may have been legitimately licensed.



2 – Pursuing Infringements. Blockchains will only be able to represent images exclusively it they expect to pursue infringers. In addition, they can only work for new images that have never been available on the Internet, or promoted on your own website. If the image has been available for licensing through other sources the blockchain has no way of tracking that data. In theory, the photographer might be required to upload all the data to the blockchain regarding any other sale, but there are at least two problems with this.

First, when a regular stock agency makes a sale it is likely to be weeks or months between the time the customer actually begins using the image and when the image creator receives any data. And second, the data the creator receives from these other sources, and thus is able to pass on, will usually be very limited compared to what the blockchain hopes to collect.

Granted, the current system is not ideal, but it seems unlikely that blockchains will end up generating more revenue from infringements for the photographer.



3 – Setting The Price. In theory one big advantage of blockchains compared to the existing stock photo market is that photographers will be able to set their own prices for uses of their work. The big problem is that most photographers will have no idea what the market is willing to pay for the type of images they are offering.  

Photographers may know what they would like to get for a use, but is that a price a customer will pay? Set the price too high and the photographer will make few, if any sales. Set the price too low and they may make sales, but never earn enough to cover the costs of producing the image. This is particularly a problem for young photographers and those with little experience in the industry because they have no understanding of the value a customer might receive from using their image, or what the current market will bear.

In reality, no single price is right for all uses of any image. What a customer is willing to pay depends on who the customer is, the intended usage, the uniqueness of the image, the amount of time it takes the customer to find the right image, and the number of images needed. In the stock agency system almost every image is licensed at multiple different price points depending on the above factors. There is no single price that is right for every customer.

Choosing the ideal price that ends up generating the most revenue will be very difficult for most photographers.

If the photographer is able to adjust the price at any time depending on the interest shown in a particular image that might help, but there there is no indication that will be part of any of the blockchain systems being offered. It also seems that there will be no way for a customer to have a discussion with the image creator to determine if an adjustment in a high price is possible.

4 – Marketing. The next big concern is how these blockchain operations will convince customers to come and look at the images they have to offer. For the most part they haven’t set aside any revenue share of sales to be used to tell customers about what they have to offer.

Do they assume that as soon as they open their stores the customers currently buying from the Big 3 will stop going to Getty Image, Shutterstock and AdobeStock and rush to the blockchains for the images they need?  Do customers care whether photographers get 20% or 100% of fee paid to use the image? Customers care about price, variety of images to choose from, and service.

Shutterstock spent about $140 million on sales and marketing in 2017. Where will the blockchain operations get that kind of revenue for long range competitive marketing? Will their investors put up the money when their only profit for money invested comes from appreciation in the value of their crypto currency?

5 – Getting The Images. Where will the blockchains get enough images to really be competitive with the Big 3 in terms of quality and variety? Is the assumption that the minute the blockchains actually get their searchable sites up and running every photographer will stop uploading to the Big 3 and send all their new images to one of the blockchains. The Big 3 will still have a huge resource of material that will satisfy the needs of a majority of their customers for many years – even if they add no new images. Will the “new pictures” people upload to the blockchains really be the ones customers want to buy? It won’t be about the quality of work that any particular individual uploads, but the overall quality of the collection.