March 2004 Selling Stock

617

©2004 Jim Pickerell - SELLING STOCK is written and
published by Jim Pickerell six times a year. The annual subscription rate is $120.00 to have the printed
version mailed to you. The on-line version is $100.00 per year. Subscriptions may be
obtained by writing Jim Pickerell, 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-251-0720, fax 301-309-0941, e-mail: jim@chd.com. All rights
are reserved and no information contained herein may be reporduced in any
manner whatsoever without written permission of the editor. Jim Pickerell is also
co-owner of Stock Connection, a stock agency. In addition, he is co-author
with Cheryl Pickerell of Negotiating Stock Photo Prices, a guide to pricing
stock photo usages.

January 24, 2004 (Story 610) - The distinguishing characteristic of
Rights Managed pricing has always been that users
pay based on a specific product (magazine ad, poster, etc.), the size of the use (1/4
page vs spread), circulation (1,000 copies or one million) and time (one month or 5
years). In contrast, RF pricing sets one fixed fee regardless of size of use,
circulation, time, or how many different products the image is used in.

Getty's new Campaign Pricing, or Flexible License Packs offer customers that may have many
potential uses for an image, not only a greatly simplified way to purchase the rights,
but possibly at a great reduction in costs.

In October Jonathan Klein said, "There is little doubt that customers have always
appreciated the ease of use that one gets in the RF licensing model. The first phase
of the new RM licensing model (Campaign Pricing) will come at the end of this year with
more enhancements to come in 2004. This will include the ability to license an image
for an entire campaign rather than for each individual type of usage. This has been a
common issue for creative professionals across the industry and we are certain that
the changes will be very well received."

As I noted then "the devil is in the details". I also suggested that, "the risk is
that the price will be set too low - in order to meet the needs of the masses - and
lots of dollars will be left on the table in some cases."

And finally, I pointed out that this is such a fundamental change in the way RM
imagery is licensed that everyone else in the industry will probably have to move very
quickly to the same pricing strategy. With that said, lets look at what Getty is
offering.

Flexible License Packs

Getty has eight different Flexible License Packs that give the customers
freedom to use an image for multiple types of media without having to create
individual licenses or provide precise license details. A flexible license pack
offers unlimited usage in many products, in the territory, industry and time frame.
There is no need to specify circulation, or image size. The License offers
unrestricted circulation and size, and in multiple products.

In the following charts I have outlined what is included in each of the eight Packs and
listed the prices for 3 months through 5 years for the Base Fee charged for The Image
Bank and Taxi images and the premium price (15% higher) charged for Stone images.

All Advertising Pack

Unlimited Advertising usage within the territory, industry and duration you select.
This pack included all uses within the following groups of uses as shown in the
categories of selection 1 or the price calculator: Advertising - Print/Web, Displays -
Indoor/Outdoor and Brochure or Marketing Collateral.

Collateral and In-Store Display Pack

Unlimited Collateral and In-Store Display usage within the territory, industry and
duration you select. Uses include: Brochure or Direct Mail, Electronic Only Brochure,
Single Sheet or Postcard, In-Store Display or Poster.

Collateral and Web Pack

Unlimited Collateral and Web usage within the territory, industry and duration you
select. Uses include: Brochure or Direct Mail, Electronic Only Brochure, Single Sheet
or Postcard, Web - Email, Web - Banner Ad, Web - Corporate or Promotional Site, Web -
Personal Wireless Device.

Collateral Pack

Unlimited collateral usage within the territory, industry and duration you select.
Uses include: Brochure or Direct Mail, Electronic Only Brochure, Single Sheet or
Postcard.

Collateral, Print Ad and Web Pack

Unlimited Collateral, Print Ad and Web usage within the territory, industry and
duration you select. Uses include: Brochure or Direct Mail, Electronic Only Brochure,
Single Sheet or Postcard, Print Ad - Magazine and Newspaper, Print Ad - Directory,
Print Ad - Free-standing insert, Print Ad - Event Program, Web - Email, Web - Banner
Ad, Web - Corporate or Promotional Site, Web - Personal Wireless Device.

Print Ad and Web Pack

Unlimited Print Ad and Web usage within the territory, industry and duration you
select. Uses include: Print Ad - Magazine and Newspaper, Print Ad - Directory, Print
Ad - Free-standing insert, Print Ad - Event Program, Web - Email, Web - Banner Ad, Web
- Corporate or Promotional Site, Web - Personal Wireless Device.

Print Ad Pack

Unlimited Print Ad usage within the territory, industry and duration you select. Uses
include: Print Ad - Magazine and Newspaper, Print Ad - Directory, Print Ad -
Free-standing insert, Print Ad - Event Program.

Print Ad, Web and Billboard Pack

Unlimited Print Ad. Billboard and Web usage within the territory, industry and
duration you select. Uses include: Print Ad - Magazine and Newspaper, Print Ad -
Directory, Print Ad - Free-standing insert, Print Ad - Event Program, Web - Email, Web
- Banner Ad, Web - Corporate or Promotional Site, Web - Personal Wireless Device,
Billboard.

To summarize, the Base Rate (Image Bank/Taxi) for one-year use for each Pack
is as follows: (The price for Stone is consistently 15% higher than the Image
Bank/Taxi base price.)

Using the list immediately above you can one can find the rate of other
periods of time multiply by the following factors:

Premium Brands

It is interesting that the prices for the various brands on the site vary
and the highest priced brand is not necessarily what one might expect. The images of
7 of the 16 RM brands on the site are priced at the Base level. These brands are: Beateworks,
Illustration Works, Lonely Planet Images, Photographer's Choice, Robert Harding World
Imagery, Taxi and The Image Bank.

As I noted Stone images are priced at a 15% premium above the base price, but in
addition to Stone, National Geographic and The Bridgeman Art Library are also priced
at a 15% premium. The images of Allsport Concepts, Hulton Archive and Time Life
Pictures are priced at a 5% premium to the Base price.

It is hard for me to understand the reasoning for pricing Time Life Pictures and
Allsport Concepts at a level lower than National Geographic, but obviously Getty has
some reason for this decision. Another brand where the pricing is difficult to
explain is 3D Clinic. At this time they don't appear to have many images on the site,
and most of what they have is some very excellent medical illustration. These images
are priced below the Base price at 9/10ths of that figure. To my way of thinking
someone has no confidence in these images. I would grant that there may be relatively few
buyers who need this type of imagery. But, I would think the buyers who do need this
imagery would not only be more than willing to pay the Base price, but probably a 5%
to 15% premium given the quality of the images.