Future Planning
In the next few months I intend spend a lot of time examining the question, “
Can the stock photo industry raise prices on at least some of the images it offers?” The possible answers to that question are either YES, NO or MAYBE.
Can the stock photo industry survive if it is only a business of amateur suppliers? It is certainly on road to becoming that business. Gross sale rates have declined so much that most photographers who need revenue from the images they produce to support themselves and their business can no longer justify continued production. (Check out stories
here and
here.
Shutterstock supplies very little information about their Enterprise customers and how Enterprise sales work. Yet it is an extremely important segment of their business and critical to understanding the company’s potential for future growth. At the end of Q3 2016 Shutterstock had 35,000 Enterprise customers up from 24,000 at the beginning of the year, or about a 46% increase in 9 months. How much of that 46% is real growth?
I was asked recently if I am optimistic that Shutterstock will maintain its momentum in 2017? The short answer is YES, I believe Shuttrstock’s 2017 growth will continue on the same track as it has in the last two years. In 2014 revenue growth was
39%. In 2015 it was
30% and in 2016 it is expected to be around
18%. I expect the company will continue to maintain its
DOWNWARD trend.
An investment portfolio manager recently asked me to spend five minutes giving my “high-level thoughts on the (stock photo)
industry outlook, competitive dynamics and emerging trends.” I couldn’t do it in anywhere near five minutes. Here are my high-level thoughts.
Many
Shutterstock investors see the steadily rising number of images in the Shutterstock collection and the number of new content creators being added each quarter and come to the conclusion that there is no problem on the supply side of the stock photo business. But, having more and more product is not enough. It needs to be the right product that fulfills the customer’s needs. And the right images need to be easy for each unique customer to find.
A month after the Getty’s initial announcement of its
Unification Project Getty has announced that “Due to the complexity of the work required (in the iStock Royalties and Unification Project) we are pushing back most of the changes by about a month.”
The buzz word in the world today is “Big Data” and how it is going to improve everything. But in the stock photo business are the major agencies are really examining the data they have collected? If they were I think they would be more worried about their future and doing a lot of things differently. I don’t see that happening.
As I pointed out in a
previous article I recently contacted a number of very successful photographers who, in the 90s, earned most, if not all, of their income from stock photography. After 2000, and despite a lot of continuing hard work and cost cutting, many saw significant earning declines and eventually had to look for something other ways to support themselves and their families.
The 30th annual
GDUSA Stock Visual Reader Survey, is now available. GDUSA says that stock visuals have become a vital creative resource for graphic designers, moving over the 30-year period from marginal to mainstream to essential.
Students who have decided to study photography at the post secondary level (college or university) should sign up for the
Alamy Student Scheme and begin to get a realistic idea of the value of their work in the marketplace. Alamy can help the student learn what customer’s want.
Of the millions of stock images which ones are actually being purchased and used by customers? Photographers trying to earn a living need better information about exactly what images are selling so they don’t waste time shooting things no one is interested in buying.
I have been told that there are at least 650 million images available for easy licensing in various databases around the world. This doesn’t include all the images that can be found by searching Google, Bing and the social media web sites where other images can be found, but not easily licensed. Only between 1% and 4% of these are ever licensed. Do photographers need better information so they don't waste so much time shooting all those images no one wants to use?
It is that time of year when students are getting ready to head off to college. Most will go there because it sounds like more fun than going out and getting a job and because they have been told that a “higher education” will give them a better chance at future career advancement and eventually earning more money.
Many RM photographers are opposed to Royalty Free because they believe that for a single low fee they would be giving away all future rights to use their images. That’s not quite true. Check out this story to see the real differences and understand how much you might really be giving away if you license your images as RF.
Photographers choose to sell their work as RM for three reasons: (1) They believe that everything they produce should only be licensed for prices higher than those charged for RF, (2) They dream that one, or a few, of their images will eventually be licensed for an extremely broad, major use. Customer who make such uses are willing to pay multi-thousand-dollar prices for exclusive rights to such images, and (3) Such high value sales can only happen if images are always licensed based on use. There are several fallacies to these arguments.
In a
previous story we talked about five aspects of the image licensing business where serious modification to standard practices are needed, if the industry is move ahead and grow revenue. In that story I dealt with three of the five: (1) Pricing Floor For Certain Imagery, (2) Simplified Pricing and (3) Better Actionable Data For Contributors That Relates To What’s Selling. In this story we’ll examine the issues of (4) Curation and, (5) a Central Database For Small Collections.
If there is going to be a business of producing and licensing rights to stock photos five or ten years from now, the industry needs a serious re-design. There are at least five areas that need serious modification if the industry is to include anything other than User Generated Content (UGC), or if there is to be revenue growth.
Paul Melcher disagrees with much of my pessimism about the future of the stock photo industry. I have the greatest respect for Paul and his opinions. He is founding director of
Melcher Systems and has been working in the stock photo space for more than 20 years. He has a thorough understanding of our industry. He has done much more in depth research of the tech side of the industry than I have, and has much better contacts and networking in that space. For these reasons, it is important for my readers to carefully consider what he has to say.
I was recently asked for my views on where the stock photo industry is headed over the next few years, the value of the industry at present, and how I think the major players will adapt to the growing availability of user-generated content. Here’s my answer.
Getty Images has contacted Veer contributors to explain what will happen to their imagery as a result of the
sale of Corbis to VCG. Their imagery will not be integrated into the Getty Images collection. Veer contributors may apply to iStock for possible upload of their content there. The memo says:
So you want a career in photography. You like taking pictures. It’s fun. Wouldn’t it be great if you could get paid to do it? You’re a high school student about to graduate. Everyone says you need more education to have a chance at a good job. You’ve no idea how much you’ll have to earn to feed, clothe and house yourself, and maybe some day a spouse and family. But, it seems you should get more education in the career path you want to follow.
Photographers with a goal of maximizing earnings from the images they produce, and who continue to insist that in order to realize that goal their work must be licensed as Rights Managed (RM), may need to consider the new realities of the stock photo business.
Photography has become much more of a means of self-expression than a business. That’s not necessarily a bad thing unless you are trying to earn your living from the images you produce.
I just returned from the annual “Photo Week” in New York – two days at
PhotoPlus Expo, two-and-a-half days at the
DMLA annual conference and one day at
Visual Connections. Here are a few take aways.