100% Royalties At Videoblocks

Posted on 8/3/2015 by Jim Pickerell | Printable Version | Comments (0)

If you’re a videographer and have been discouraged by low prices and low royalties for your work it’s time to check out Videoblocks.

Videoblocks started out as a subscription site offering one-year unlimited downloads for $99. Currently Videoblocks has about 150,000 video and After Effects clips for subscribers to consider. Their strategy for acquiring content has been to pay a flat fee for non-exclusive rights to collections.

In April at the National Association of Broadcasters conference the company added a new feature when they launched the Marketplace section of their site. Customers must have an annual subscription in order to access Marketplace. When they choose any of the Marketplace clips they pay an additional $49 if it is HD or $199 for 4K.

These prices are a little less than most other stock sites are charging, but the big benefit for videographers is that they get 100% of the fee paid by the customer (minus the credit card processing fee) instead of something in the neighborhood of 30% from other sites.

On the Videoblocks site you’ll find an interesting earnings calculator that allows you to enter the number of clips you typically license a month and see a comparison between what you could earn from Videoblocks compared to Shutterstock. It turns out that videographers will earn about twice as much from Videoblocks as Shutterstock despite the fact that Shutterstock charges its customers a higher price.

How Is This Possible?

How can a company offer this kind of service and not charge something for that service? I asked, “Is the 100% royalty just an introductory offer, or is it expected to continue forever?” Videoblocks CEO Joel Holland answered, “Forever. We intend to be the most artist friendly stock video company in existence.”

Videoblocks covers its operating costs and profits from the subscription dues customers pay much like membership organizations such as Costco. While Costco certainly earns significant revenue from its membership dues, it also has a price markup on the products it sells. According to Investopedia “Costco doesn’t publish its margin caps but, by looking through the company’s 2014 financial statements, we can see that for the past five years, their margins have held steady at about 10.6%. This means that for every $100 that Costco spends to buy its products, it’s selling them, on average, for $110.60.”

Thus, if Videoblocks were returning 85% to 90% of what the customer pays they might have a better chance of sustaining this business model long term. Meanwhile, Videographers can happily accept 100% of what the customers are paying. Hopefully, if somewhere down the road Videoblocks decides to reduce the royalty to 85%, videographers won’t get upset and feel they are being cheated. This is a very good deal.

Currently there are about 374,000 clips in the Marketplace collections that are live on the site. Another 40k are in the queue awaiting meta data or approval. Holland says “Marketplace sales have been strong, and doubling each month! We already have multiple contributors who are on track to earn six figure commissions in their first year.”

All content licensed through VideoBlocks is non-exclusive, so videographers can keep their relationships with other agencies. They can upload or remove content at any time, no strings attached. Videoblocks has been in business for more then five years and licensed 32,933,338 total video and after effects downloads.
For more information contact the contributor support team: pbagevohgbe@ivqrboybpxf.pbz or +1-888-802-7316.

Copyright © 2015 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of www.selling-stock.com, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to: http://www.jimpickerell.com/Curriculum-Vitae.aspx.  


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