Random Thoughts 112

5

November 7, 2005

Return-Per-Image Going Down At Getty

For the last three years I have been doing calculations to determine the average gross annual return-per-image for both Rights Managed and Royalty Free images on Gettyimages.com. To accomplish this I have done searches to determine the total number of images on the site in each of these categories, and then divided those numbers into the total gross RM and RF revenue for the previous four quarters. (For more on the 2004 figures see Story 689.)

The current figures are:

The principle reason for the drop is that the number of images available is rising much faster than the revenue growth. The number of images available on the Gettyimages.com at the end of 2003, 2004 and currently are as follows:

Photographers should keep in mind that these averages reflect the gross return for Getty. What the photographer or the Image Partner agency receives is some smaller percentage of these gross figures. As Getty seeks to add more images to its site in an effort to give customers a broader choice, it can be expected that the total number of images available will continue to rise dramatically. Meanwhile, there has been no significant rise in the number of images licensed. As the total number of images available rises, and the number of images licensed remains stable, the likelihood of any particular image being licensed will continue to decline.

It should be recognized that these numbers are only averages. Some photographers will see much better results and others much worse.

(One thing that adds to the inaccuracy is that images were being added to the file throughout the year. They did not suddenly jump from the September 2003 figure to the November 2004 figure. If I had been able to base my averages on a monthly, or more frequent basis the results would undoubtedly have been different, but I believe the general trends would have remained about the same.)

It is also interesting to note that the average return per RF image has been declining at a much slower rate than the average return of RM images. Now the average return for an RM image is 26% lower than an RF image. I believe there are two reasons for the slower decline in return for RF. First, fewer RF images are being added, and the rise in total numbers of images is smaller in general. Second, the price charged for each RF image licensed has been rising dramatically while the average price charged for an RM image has remained relatively stable.

Photographers should remember that the average price-per-image-licensed has much less to do with their gross potential income than what they receive on average for ALL the images they produce, and ALL the images they are able to get into the marketplace through their agent, or agents.

RM photographers who still believe it is better to be able to license their images for high dollars rather than offering them at RF prices need to carefully consider these numbers. It is also worth noting that RF producers tend to get a higher percentage of the images they produce into marketing, than is the case with RM producers, particularly if the company accepting the images for marketing is Getty Images.

Imagestate Appoints Hart COO

Imagestate has named Monica Hart to the post of COO and Stuart Cox as Head of Content.

Monica began her stock photography career at Adobe over ten years ago, then moved to PhotoDisc where she was instrumental in growing the European business into an attractive takeover proposition for Getty. Monica remained with Getty after the PhotoDisc takeover, then moved to Alamy, where she headed up the company's worldwide commercial operations for almost four years. Monica's most recent position was with Pacific Investments, where she was working on the company's media interests.

Stuart joins Imagestate from Alamy, where he was instrumental not only in growing the contributor base and strengthening contributor relations in the US and UK but also in growing worldwide customer sales as part of Monica's team.

In addition to these changes, the company also announced it has added over 100,000 images from worldwide contributors to its website in the past six months. It has also signed many new agents worldwide including TIPS Images, Agencja Free, TCS, Sunday Photo, Other Images and Latin Stock.

Monica commented "Imagestate was always a best seller when I was at Alamy and the company also has a lot of other fantastic new wholly-owned and exclusive third-party material, such as Hachette Fillipacchi Photos. Stuart will also bring a wealth of contacts and knowledge to the company and I look forward to working with him again."

Jeff Shear recently resigned as Managing Director, but Imagestate is delighted to announce that he has become a non-executive director and is continuing to work with the company as a consultant advising on, and managing, technology development.

Rumors have it that the U.S. office will be downsized, if not closed as operations are concentrated in the UK. The acquisition of imagery has been handled by the London office for some time and will continue to be handled by the UK staff.

Alamy To Place Copies Of Site In Multiple Loactions

In an effort to speed searches, Alamy has announced that it will be placing copies of its image catalog, currently numbering more than 3.8 million images, at various locations around the world. Currently, all the images are stored in London and searches are delivered from there.

The first such mirror site will be launched in December in New York City. Once this has been accomplished it is expected that a page of search results load twice as fast for U.S. customers as is currently the case. Additional mirror sites will be launched in other major cities around the world in 2006. It is anticipated that there will be further speed improvements as the number of locations increases.

Jupiterimages New Site

In story 774 I provided an incorrect link for JupiterImages new site, at JIUnlimited. The correct address is: www.jiunlimited.com.

From: Betsy Reid, Executive Director SAA

Jim, Thanks for this analysis. I think you've made some excellent observations. There's a major missing piece of the puzzle, however, that's essential before one can interpret this trend and start drawing any conclusions upon which to base business decisions. That is, what's the average percent of the revenues that's actually going to photographers? Let's call it return-per-photographer or RPP.

There needs to be another chart with average RPP for RM and RF, or better yet, looking at Getty owned brands, third-party RM brands, Getty RF brands and third-party RF brands. If for example, the average RPP for Getty owned RM brands is based on 35% and the average RPP for third party RF brands is 5%, that paints a very different picture. We both know that this information isn't easily available, but we could certainly make some good guesstimates.

Comment: Jim Pickerell

I think I will have to leave it to each photographer to make a judgment for him or herself because the percentages vary so widely depending on whether the photographer is under direct contract to Getty, submitting images via Photographer's Choice with an added cost for posting the images, or submitting them through a third party Images Provider to Getty. In some cases the photographer may get as high as 40% of gross revenue and in other a figure significantly below 10% -- and everything in between.

Assuming that the photographer can determine his or her actual percentage of the gross sale then it is easy to figure whether his or her returns are higher or lower than the average for all Getty photographers. And the Rights Managed photographer should not be surprised if 2005 revenue per-image is lower than 2004.