Why can’t the three major distributors – Getty, Corbis, Alamy – set reasonable prices for textbook use? As licensors of the images they should be able to set the price. Instead, they allow the major publishers to dictate to them what they will pay.
This happens because the agencies are so worried about losing market share that they constantly try to undercut each other and play right into the hands of the publishers.
The question for image creator is how long can they continue to allow their work to be licensed by organizations that totally undervalue it?
I recently published a story outlining the terms of a
McGraw Hill request for a textbook use and discussed how I think photographers and stock distributors should approach such requests. John Harris reported that he had a recent request from Pearson Education for similar rights and all they were willing to pay was £15. At such low prices can anyone afford to license textbook uses???
(It is interesting to note that North American Education is Pearson’s largest line of business. In 2010 this division of the company had sales of £2.6 billion (over $4 billion) and operating profits of £469 ($725) million – and they can’t afford to share a little of that with the creators of the content.)
At some point those who represent our work must say that
Enough Is Enough and stop licensing images to textbook publishers for ridiculously low prices.
Distributors who license rights to photography need to take a stand and do the following:
1 – Recognize that books are products. Textbooks are not editorial uses supported by advertising. They are not marketing pieces where there is no guarantee that each additional copy will generate a proportionate share of revenue. Publishers receive a fee for every copy distributed. The strategies for pricing such uses must be different from the ones used to price other uses of photography.
Publishers will keep pushing for lower prices as long as no one is willing to stand up for their rights and withhold their images. While the fees paid to use content continue to drop, publishers continue to charge more for books and online access to educational material, and line their pockets with the profits.
2 – Post realistic prices on distributor web sites. (In some cases the base numbers of small circulations are reasonable, but there are four major areas where adjustments need to be made.) Distributors should:
a – Provide reasonable multiples of increases for circulations above a base of 40,000. (See my proposal at the bottom of this story.)
b- Measure circulation on the basis of “unique users” regardless of whether the users access to the material (image) is through a printed book or online.
c – Eliminate the whole concept of “term” of the license as an option. The term expires when the number of “unique users” is reached whether that is one month or ten years.
d – Require, as part of the license agreement, that at least once every two years, the publisher provide an updated number of total unique users that have been licensed to use each product that contains licensed images. This can be accomplished in one of two ways.
(1) The publisher will send an individual notice to every licensor of content that is used in the publisher’s products.
(2) The publisher will maintain and keep constantly updated a comprehensive password protected database that contains circulations figure of each of its products. The publisher will provide each licensor with the password to access that database.
The license should state that if the publisher fails to supply that information he will be re-billed for the same license fee every two years until the data is supplied.
3 – Eliminate discounts until circulation figures are provided. Tell publishers that discounts on posted prices for educational product uses will no longer by offered until the publisher provides circulation figures for all titles in which the distributors’ pictures have been used in the last 7 years.
4 – Make it clear in a written document, delivered to any publisher who requests an image for review, or for reuse, that the distributor or representative will pursue a copyright infringement action if the publisher uses the image in any product that is delivered to one of their customers without first receiving an invoice for the use. All invoices must be paid within 60 days.
Why distributors refuse to take action.
Of course, distributors are afraid that the publishers will go somewhere else to get the images they need. That might be the case if we were talking about small, niche agencies, but the major publishers obtain a significant percentage of the imagery they use from the three major distributors. It is hard to imagine that the publishers could satisfy their needs if all three distributors were to change the rules at the same time. But the distributors will argue:
1 –
Publishers simply won’t agree because it is too costly.
If the publishers argue that what we’re asking is too much work or too costly, it should be pointed out that they have systematically been hiding true circulations from suppliers for 10 years or more. As a result suppliers can no longer trust them to report uses accurately and must have some system that allows them to monitor circulation. The only other alternative would be to bill everything as if the circulation would be 2 or 4 million and based on the new circulation guideline the distributors have established (See item 2a) that would mean that every use would cost thousands of dollars.
2 –
Individual photographers and specialist agencies will undercut their prices.
Some of this may happen, but it would probably cost the publishers more administratively to go to individual photographers for every image they need, than to pay the higher prices the major distributors would be asking, particularly if the publishers start out by purchasing just enough circulation to cover their immediate needs. Finding the right image from individual suppliers will be very costly for the publishers.
If photographers, in mass, want to kill any future market for themselves then they will go out and undercut any effort the distributors make to change things. Of course, long range that won’t work because the major distributors will reverse course as soon as they see that a significant number of photographers are undercutting them. They will go back to offering the publishers lower prices than the photographers will accept.
If specialist agencies try to dramatically undercut the major distributor’s published prices that information would be available to image suppliers and probably cause many to rethink their relationships with the distributor. Since distributors would be sticking to their published prices image creators will be able to look at their royalty statements and determine if the distributor is discounting, or not.
Any new pricing strategy would be well publicized within the photographic community. Most photographers who make direct sales will want to ask for very near what the agencies are receiving. Photographers that don’t try to keep their prices in line with what the major distributors are asking will be cutting their own throats. Most of the small suppliers would be happy to charge the same rates as the big agencies.
3 –
Publishers will go to microstock to get the images they need.
They are already doing that. But the publishers continue to come back to traditional suppliers because microstock doesn’t have much of the imagery they need. In addition most of the microstock images are not accurately captioned. And, microstock has a 500,000 copy circulation limitation unless the publisher buys an extended license. Microstock sellers also treat producers of products differently than other photo users and they may decide to treat textbooks as a product. This could further increase the prices they charge for such uses. Book publishing is not a big segment of microstock’s market, and therefore the microstock sellers might see this as an opportunity not only to support the photographic community in general, but to earn more money through higher prices for certain products.
4–
They will lose significant sales for several months at the very least.
Such a unified action would undoubtedly mean that for a period of time there would be a dramatic fall of in the number of licenses to the educational market. This could severely impact a few distributors that specialize in supplying images for educational use, but I doubt if it would have much impact on individual suppliers, nearly all of whom can no longer depend on the revenue they receive for educational use for much of their support.
However, if all the major stock agencies were to participate, I doubt that the publishers would be able to maintain their publication schedules for very long without having access to the images the distributors supply.
5 –
Such an action would be illegal price fixing.
In my opinion such an action is not price fixing or a restraint of trade. Each distributor could still set its own prices, but those prices would be published and easy for all their contributors, as well as their customers to see. While all prices don’t have to be the same prices need to be raised to a whole new level after years of cuts and discounts that have resulted in totally unreasonable prices.
Something must be done to bring publisher to the negotiating table. The distributors have the power to do that if instead of short term advantage they will consider the long-term best interests of their suppliers and themselves.
Circulation Multiples
The following are my recommended multiples for circulations other than 40,000. Considering the additional revenue generated for the publishers by the higher circulations these numbers are more than fair, but certainly there is absolutely no justification for a multiple of only 2 times the base number for a circulation of one million or more copies which is what some image distributors are charging.
| Circulation |
Multiples |
| 10,000 |
0.7 |
| 20,000 |
0.85 |
| 40,000 |
base |
| 80,000 |
1.4 |
| 120,000 |
1.85 |
| 250,000 |
2.7 |
| 500,000 |
3.65 |
| 750,000 |
4.65 |
| 1,000,000 |
5.7 |
| 1,250,000 |
6.8 |
| 1,500,000 |
8 |
| 2,000,000 |
10 |
| 5,000,000 |
20 |
Pearson just sent out a request for use of a photo in the English language edition of a book to be released in Ecuador only. They want the right to print 5,000,000 copies. (The total population of Ecuador is less than 14 million.) Obviously, they are not going to pay $4,400 to use that image, but if they are really serious about the circulation number then that price should not be a hardship. We must get back to some level of reality. The only way that will happen is if the major distributors take a stand, or if all suppliers start refusing to let the major distributors license their images for educational use.
These figures are my recommended base prices for use of an image based on the amount of space on the page. Anything smaller than 1/4 page is charged at the 1/4 page rate.
| Image Size |
Base Price |
| 1/4 Page |
220 |
| 1/2 Page |
290 |
| 3/4 Page |
365 |
| full page |
440 |
| Chapter opener |
550 |
| Cover |
1100 |