iStockphoto has introduced its new round of price increases for 2011. For those in the macro world (RM and traditional RF) who like to argue that it is impossible to make money selling images on a microstock site it may be time to take another look at what iStock is doing.
Currently the company has 5 different collections at different price points.
| |
Non-Exc. |
Exclusive |
Exclusive+ |
Vetta |
Agency |
| XS |
1 |
2 |
5 |
|
|
| S |
3 |
5 |
10 |
30 |
55 |
| M |
7 |
10 |
20 |
50 |
75 |
| L |
10 |
15 |
30 |
70 |
100 |
| XL |
15 |
20 |
35 |
100 |
150 |
| XXL |
20 |
25 |
40 |
125 |
200 |
| XXXL |
25 |
30 |
50 |
150 |
250 |
A few things are worth noting. They have kept the number of credits required to purchase an images in their main, non-exclusive collection the same as in 2010 with the single exception of raising the credits required to purchase the medium size file from 6 to 7. This would tend to indicate that they feel they have reached the maximum of what the small user is willing pay for images.
While they don’t want to chase the small users away, there are indications from the blogs where some photographers report their sales results that many customers have been leaving iStock and finding the images they need on Shutterstock, Dreamstime and Fotolia. Images licensed by iStock in 2010 were probably down compared to the number licensed in 2009. Nevertheless, iStock still probably licensed rights to in excess of 22 million images in 2010 while Getty-Images was probably lucky if it licensed rights to 1.5 million from its Creative collection and Alamy probably licensed something in the range of 200,000.
To deal with its problem of fewer sales, and still keep their gross margin strong, iStock has cut the percentage of gross revenue they pay out to non-exclusive photographers as a royalty. So yes, those in the macro world may be right when talking about images in iStock’s non-exclusive collection.
On the other hand, iStock is definitely putting much more emphasis on selling to the professional users who can afford to pay more for the images they need. The prices on the other collections are quite different from the non-exclusive collection. In particular the company has raised the prices on Exclusive + quite a bit.
| File |
2010 |
2011 |
| Size |
E+ |
E+ |
| XS |
5 |
5 |
| S |
10 |
10 |
| M |
15 |
20 |
| L |
20 |
30 |
| XL |
25 |
35 |
| XXL |
30 |
40 |
| XXXL |
35 |
50 |
When photographers move their images from non-exclusive, to exclusive, to exclusive+ in order to get higher prices they tend to see a rapid fall off in the number of sales they make. At the higher prices many of microstock’s traditional customers can no longer afford to use the images, regardless of how great they might be. After seeing the new prices for Exclusive+ a significant number of photographers who have risen through the microstock ranks have indicated that they want to move their images back to the lower priced Exclusive category. Evidently these photographers are convinced that the higher price per unit licensed will not make up for the loss in number of sales.
On the other hand, photographers from the macro world now find the premium collections much more reasonably priced. While the prices may not be as high as traditional royalty free, these photographers believe they are likely to make more sales than if their images were licensed through non-microstock sites. This seems likely to happen because currently a larger percentage of the total customer base tends to use the microstock sites, rather than the traditionally priced sites, to search for the images they need. The photographers with images in the higher priced brands may also benefit from better positions in the search return order.
One photographer with images in all four of iStock’s premium collections and experience in both the traditional RF and microstock markets earned in excess of $400,000 in 2010 and an average of $8.60 per image downloaded.
Another thing to consider is that the credits are not really the price. Most credits cost more than $1.00.
| iStockphoto Credit Prices |
|
|
| Credits |
Price |
$/Credit |
| 12 |
$18.50 |
$1.54 |
| 26 |
$39.50 |
$1.52 |
| 50 |
$75.00 |
$1.50 |
| 120 |
$175.00 |
$1.46 |
| 300 |
$430.00 |
$1.43 |
| 600 |
$800.00 |
$1.33 |
| 1,000 |
$1,250.00 |
$1.25 |
| 2,000 |
$2,250.00 |
$1.12 |
| 5,000 |
$5,250.00 |
$1.05 |
| 10,000 |
$10,000.00 |
$1.00 |
| 20,000 |
$20,000.00 |
$0.95 |
If someone wants to purchase one XXXL file from the Agency collection they would have to purchase at least 300 credits and the image would actually cost them $357.50. Sure, if they were a big user and wanted to purchase 20,000 credits they could get the image for a little less than $250.00. But there aren’t going to be many customers whose image usage requirements are such that they can justify purchasing that many credits at one time.
Even those photographers who are adamantly opposed to licensing images through microstock sites need to be aware of these trends. There is every reason to believe that we will see more pricing segmentation of various collections at iStock in the future.