15% Royalties At Getty

Get ready for 15% royalties. Getty has contacted some European agencies that supply the company with Royalty Free images for its Creative collection and told them that when their current contracts expire they will be terminated unless they agree to accept a 15% royalty.

Not only is Getty lowering the royalty, but they are licensing more and more images on a subscription or Premium Access basis at lower and lower prices. While many of Getty’s sales are already below microstock prices, it would seem that their strategy is to lock more and more customers into subscription commitments. Once they have the customers dependent on them they will slowly raise prices.

In the last few months I have been able to examine a number of photographer sales reports. For 65% to 75% of the images licensed the gross license fee was under $10. When I check reports from photographers 3 or 4 years ago the average number of sales under $10 was in the 20% to 30% range. I thought that was terrible at the time. If you go back to 2007 no one would have thought of ever licensing an image from the Getty Creative collection for such a low price.



15% to a stock agency means a lot less to that stock agency’s photographers. If Getty charges a customer $10 to use an image, the agency gets $1.50 and the photographer may get 50% of that or $0.75. On the other hand, some agencies only pay photographers 20% of what they receive for RF sales. Thus, 20% of a $1.50 sale only nets the photographer $0.30 for a $10 sale.

But it get’s worse. Many of the sales Getty reports are made by distributors who get to keep up to 50% of the gross fee the customer paid before they remit the remainder to Getty. The figure Getty reports as the gross sale is what Getty received, not what the customer actually paid. So let’s assume the end using customers paid $20 to the distributor who licensed the image. The distributor keeps 50% and pays Getty $10. The image creator gets $0.30 of that $20 sale or a 1.5% royalty.



And, remember, that 65% or more of the sales are for UNDER $10. Many are way under. The average of this group of sales, on the sales reports I have examined, is $2.00 to $4.00.
 
Getty has had a 15% royalty for iStock non-exclusive contributors for several years. When they lowered the royalty percentage from 20% to 15% a number of non-exclusive contributors pulled out of iStock. Others left their images there, but just stopped producing new images. Despite this loss of imagery Getty seems to feel that iStock still has plenty of non-exclusive images. If the strategy worked there why not on the flagship Getty Images site.

As far as we know they haven’t told any individuals who supply RF images to Getty directly that their royalties will be cut, but can that be far behind?



Every photographer with images on Gettyimages.com should review their sales reports to determine the percentage of images licensed recently for under $10 recently as well as the number licensed two, three or four years ago. Check out the trend. Ask yourself if your production cost have dropped that much? Of, if there is any way you could possibly cut your production costs that much.

Some Money Is Better Than Nothing

Once they have images in a collection many photographers take the attitude that “some money (no matter how little) is better then nothing.” As a result they stop producing, but they leave the images already in collections where they are, hoping for the best. Many of these photographers who are committed to RM and traditional RF pricing should take another look at microstock.

Granted it is a lot of work to delete images from Getty and re-upload them into microstock collections, but the prices Getty is charging to use many of the images in its collection are lower than microstock prices. I know of photographers who have similar images in both iStock and the Getty Images collection and they are earning more from iStock than from Getty.

In addition is also possible to put the same images with Shutterstock, AdobeStock, Dreamstime and 123RF and make additional sales. One big advantage of dealing with these agencies is that virtually all the sales are direct to the customer by these prime agencies. There are not a lot of additional cuts by other distributors. Even then the revenue generated may not be worth the trouble, but it is worth checking out.