246 INDUSTRY IN TURMOIL
September 9, 1999
The stock photo industry is in turmoil. Never in the more than thirty years I have
been involved in stock has there been so much uncertainty among photographers about
In this issue I will take an overall look at our industry and consider how the
various issues facing photographers -- royalty free, agency consolidation, over
supply, pricing, marketing methods, potential for growth in sales to internet users
and consumers, agencies wholly owning high demand subject matter and volume
production -- impact on one another.
Shifts and changes are occurring at dizzying speeds. Photographer/agency
relationships that have taken years to build have been shattered in an instant.
Information needed to make educated shooting decision is scarce. Predicting future
customer needs and finding ways to show customers what you have to offer has become
much more difficult for most stock photographers than it has ever been.
In most other lines of business the potential market is evaluated and supply lines
developed before production begins. In the stock photo business before getting
representation, it is usually necessary to produce large quantities of images on
speculation. Getting an agency contract is no assurance that the next images you
produce will be included in the agency's next promotion. More and more a few big
agencies control which images will get seen by potential clients.
Photographers are Still Making Money
The good news is that some photographers are earning significant incomes from stock
and buyers are using more stock images.
Based on a survey we did earlier this year 35% of photographers who produce and
sell stock earned in excess of $70,000 in 1998 with 6% of the photographers earning
over $400,000. This was basically the same as the survey we conducted in 1997.
On average these photographers spend 43% of their income on expenses, before taxes,
to run their photographic operations. Those making under $70,000 tended to spend a
higher percentage of gross sales in production and operating costs than did those
in the higher sales brackets. See the complete survey results in
In our survey, 51% of the photographers reported their yearly income from stock was
increasing, but the rest said income was either about the same as the previous year
or decreasing. Many of those who have built their stock incomes to levels in
excess of $70,000 per year have found that sales are leveling off -- or in some
cases falling -- in spite of continued production. Based on comments we have
received from photographers so far in 1999 we expect our survey in 2000 will show
that a higher percentage of photographers are seeing a decline in sales.
The number of stock images used by buyers is probably increasing although getting
an estimate that is reasonably accurate is probably impossible. Getty Images could
come the closest in making such an estimate, but they are not sharing that data.
While Getty can easily total up the individual sales from the rights protected
licenses, they can't calculate the number of times an RF image is used, whether it
is sold on-line or on a disc.
Whatever they are, these RF uses add to the total number of uses and have a direct
impact on the number of Rights Protected images buyers need to purchase.
Royalty Free's Role
Royalty Free is here to stay. Like it or not, it is important to realistically
assess its present and future impact on the industry.
To understand RF's share of the market we must first determine the size of the
I estimate that the gross sale of stock photography, worldwide, is $1.25 billion
U.S. The overall growth of the market in dollar volume in the last few years has
been, at best, less than 5%, and may actually be declining.
I estimate that worldwide Royalty Free sales in 1999 will be about $155 million, or
roughly 12% of total industry revenue.
Because the average fee paid for a Royalty Free use is so much lower than the
average fee paid for a "Rights Protected" use the percentage of total usages
represented by this 15% of dollars could be as high as 40% of total usages.
How do I get this number? Assume that the average fee paid for each RF image used
is $80. This would mean that if someone pays $250 for a RF disc they use, on
average, only three pictures from that disc, not all the images on it. In fact the
$80 may be high, but we will work from there. This would mean that from $155
million gross sales there were 1,937,500 uses.
On the Rights Protected side there were almost $1.1 billion in revenue. If we
assume the average RP sale was $400 this gross revenue would have represented
The 1,937,500 is over 40% of the total 4,687,500 uses. If the average price per
usage is actually lower than $80 the percentage of total uses could actually be
higher than 40%. (We have no way of determining how many times a given RF image is
used or how many images from a single disc are used.)
To take our logic a little further, assume that RF is somehow able to control 100%
of the stock photo usages. At current RF prices the stock photo market would
become a $400 million a year business, not the $1.25 billion it generates today.
The situation for photographers is even more depressing because they are probably
receiving an average of 35% to 40% of the gross revenues from the Rights Protected
market, but less than 20% of RF sales. Thus, revenue to the producers of the
images is currently approximately $416 million [$385 million (35%) for RP plus $31
million (20%) for RF). If all sales were RF the photographer's 20% share of $400
million would be $80 million.
Make It Up On Volume
One argument for the Royalty Free pricing strategy has always been that they would
make up for low prices with increased volume of sales. During the "early adopter"
phase of the RF business the number of users rapidly increased as more and more
business users found ways to use RF as a replacement for more expensive Rights
However, now that virtually all traditional photo users are aware of the advantages
and disadvantages of RF, the rate of increased use seems to be leveling off.
Consider the volume of uses it would take to get from a $400 million level of sales
to $1.25 billion at RF prices. If 4,687,500 uses generate $400 million in sales,
it would take 14,648,437 uses -- at current price levels -- to generate $1.25
billion. That's a lot of additional brochures; additional magazines; and internet
Clearly personal use would have to play an important role if RF were to reach these
numbers. The hope is that there will eventually be a volume of consumer use that
will far outstrip the number of business uses. However, if the price point for
business users is $80 per use it is hard to imagine the price point for consumer
use being much more than $10. Maybe $2.00 per use is more realistic. Thus, to
generate $1.25 billion in sales there would need to be over 117 billion uses at $10
each or over 585 billion uses at $2 each.
The Good News
It is my feeling that RF will top out at 50% to 60% of all stock usages. At
current rates, that will probably represent 20% to 25% of gross stock billings. I
believe there will always be a demand for imagery that will not be economic for RF
producers to supply. Some customers will turn back to assignments in order to
obtain certain images that can't be used by all their competitors. The savings
they realize from making some use of RF will make it possible for them to spend
more money on assignments.
There will always be a demand for some rights protected photos.
Customer will want:
- an image that is immediately available (faster then assignment)
- an image that has a different look from the RF options available.
- an image that will not be used as widely as many RF images are likely to be
- a creative idea that has already been executed, but not something that will be
used to death.
- a price cheaper than an assignment produced image, but not necessarily as low
- in some cases, specific rights control, although not many buyers actually ask
for that at present.
The big question is whether there will be enough demand at the higher prices to
justify continued production by stock photographers.
Supply vs. Demand
Most businesses try to keep SUPPLY in balance with the DEMAND, or at least the
perceived demand. This is a basic law of economics which, for the most part, the
stock photo industry totally ignores.
There has been very little control over what, or how much, will be produced in a
given subject area. The sellers encourage production in order to get variety.
Since they do not participate in the costs of this production there is no limit to
As one photographer puts it, "It's like General Motors going to their manufacturers
of steering wheels and saying we're going to sell a lot of cars next year and every
one of them will need a steering wheel. We don't know how many we'll sell so just
produce a lot. Give us a lots of variety in color and design. Some buyers may
want square wheels, some may want stripes and some may want polka dots. Be
creative. Oh, and by the way, a bunch of other suppliers will also be producing
steering wheels so we can guarantee you how many of yours we'll sell. Also, we'll
tell you after you have delivered the product what we will pay you for those that
are used. Your cost of production has no relevance to what the buyers are willing
Steering wheel manufacturers are smart enough not to produce under these
conditions. Photographers have bought into this strategy and have produced in the
last few years a tremendous oversupply of images of the most commonly used
subjects. Meanwhile overall demand has been relatively flat for the last few years
compared to the heyday of stock in the 1980's.
The system can work -- and it did -- when the demand was greater than the supply
and when prices were kept high. At some point a limit is reached for the use of
the product. Increasing supply beyond that point simply adds to costs and reduces
To a degree the big agencies are trying to control supply in areas where it affects
their costs. They are accepting fewer images into their files. However, I believe
their motivation is to cut their costs and increase their profits, not help the
photographers make wiser production decisions.
Increased advertising may increase demand. Opening up new markets may increase
demand. But, it is dangerous to greatly add to the supply until there is some
evidence that demand will actually increase. For the last few years the industry
has been dramatically increasing supply as many new photographers have attempted to
enter the business, based on the success stories of photographers who have been
selling stock for five to ten years.
The tendency has been to be seduced by the successes of a few at the top and not
fully consider the overall implications of what is happening in the market place.
Participants in the industry may be able to increase their "market share," but if
demand is not growing someone else in the industry will lose share.
The vast majority of those individuals who are currently successful in stock got
started in the 80's, or before, and built their file during the period of
increasing demand and low supply. Some argue that the old timers are successful
simply because they have been in business for a long time and that new people
starting out will be equally successful when they have ten or fifteen years
experience under their belts.
I don't think that will be the case. This totally ignores the change in the
supply/demand curve. In the 80's and early 90's there were relatively few images
to choose from in any subject area. Thus, those images that were available got
used frequently. If there were 25 images available on a particular narrow subject
in the 80's there are hundreds available now -- many of them in print catalogs.
Consequently, the buyers have a lot more to choose from and the odds that any one
particular image will be picked frequently are slim.
More and more photographers have entered the stock photo business and most have
focused their production on subject areas of people, business, lifestyles,
recreation, travel and scenics that are in high demand for advertising use.
Buyers are always looking for something different. But, there are two questions
the photographer needs to carefully consider before stepping out to produce those
"different" images. First, how many "different" looking images will I have to
produce, and at what cost, in order to make a single sale? Second, will the image
the buyers want sell frequently enough or at a high enough fee to justify the
expense and time of producing, not just that one image, but all the other
No one will know the answers to these questions when they start out. But, assuming
that the purpose of taking the pictures is to earn a profit, it is important to
track the information so that as time passes and/or sales begin to develop the
photographer can determine those subjects that are likely to be most productive.
Consumer Market Demand
In general demand is not increasing. There have been many predictions that there
is a huge untapped consumer market for images. Corbis, Getty and Index Stock are
all aggressively pursuing this market. So far there has been very little
indication that consumer sales will produce much income.
Maybe it is still too early and maybe the market will eventually develop. That is
certainly the hope of the major suppliers. Given the way percentages for these
uses are structured, if the market does develop, the people likely to reap the
benefits will be the agencies, not the photographers producing the images.
I am personally very pessimistic that such sales will ever produce much in the way
of income, but many of the biggest players in the industry are betting huge amounts
of money that sales to the consumer will be the future of stock photography. Is it
possible that Bill Gates could have made a mistake?
There have also been predictions that the growth of the Internet will increase the
demand for images. Certainly many images are being used there that were not being
used five years ago. In this area I think several things are happening.
- Many businesses are using images they purchased for other purposes. They
are paying little or nothing for this additional use. Sellers need to aggressively
push for reasonable additional fees for these additional uses.
- Small business and consumers are stealing images from the Internet. A huge
portion of the public has little or no understanding of copyright and why it is
important to continued production of new material. The motto is: "I want all I can
get now, for nothing. Let someone else worry about the future."
- Many of the images used on the Internet are self produced.
- When user do pay for images it is often at RF rates and thus it adds little to
the net gross sales of images.
- As we anticipate future growth of imagery on the internet it is likely to be
for digital video, not still images. When the internet matures as a medium for
supplying information and communication still images will appear about as
frequently as they appear on TV today.
Agency Sales Growth
The annual growth in sales that big agencies were experiencing five to ten years
ago has slowed to a trickle for most. In the first six months of 1999 growth for
Getty Images, the industry leader, went from $50.1 million to $55 million (a 9.7%
increase). During that time they acquired a company (Art.com) for stock valued in
excess of $200 million but this company added very little to their bottom line in
terms of sales.
What seems clear from the slow growth of the top agencies, and the fall off in
sales that many medium and smaller agencies are experiencing, is that the overall
increase in volume is not enough to offset the lowering in average price per image
Two agencies -- EyeWire and Definitive Stock -- each less than a year old and
heavily involved in the royalty free area of the business were recently sold to two
of the majors -- Getty Images and Visual Communications Group respectively.
One interesting thing about these sales is that when each of these companies were
established it was predicted that they were IPO bound and would be competitors to
the majors. Instead, in less than a year they have been absorbed by the majors.
Through acquisition the bigger Rights Protected stock agencies are bringing more
and more photographers under one roof. The consolidation that is taking place at
Getty Images, VCG, Corbis and Index Stock has a tendency to bring all their
photographers under one editing and marketing philosophy. This tends to reduce the
number of images and photographers these agencies need.
This can be good for some photographers because it limits the competition, but it
may not be good for everyone. In the past some photographers have found that being
with many agencies added to their success because each agency had a different
approach to editing and marketing. Some photographers have found that where before
they were dealing with three or four editors, now through acquisition and
consolidation they are dealing with only one. The variety of editorial points of
view in the past helped the photographer get more of his or her production where
buyers could see it.
When there were lots of agencies each one needed their own set of images on every
subject -- ballooning, or whatever. The image that eventually sold depended more
on the source the client used to find pictures, not necessary on which image was
the most outstanding. With fewer and more dominant agencies, statistically the
odds are that the remaining smaller agencies will make fewer sales unless they can
carve out a strong niche that the big guys aren't supplying.
Also the consolidation of several agencies under one roof -- and in one on-line
database -- is making the oversupply that much more obvious. To cut their costs
many large agencies are accepting fewer images than they had in the past.
On the other hand, there is still some need for small agencies. Those different
editing and marketing approaches still have some value. Small agencies can also
compete on-line without having to set up and promote their own sites. Picture
Network International and Workbook both have on-line sites where the work from 40
or more agencies are represented. Buyers can go to a single site and using keyword
search review what all the agencies have on a particular subject.
As use of the Internet builds, these sites will offer buyers the variety they may
be unable to find by going to the sites of the three or four majors who have made
tight determinations about what images the buyers should be allowed to see.
There are two basic production strategies I would like to review -- I'll call them
the FPG and the TSI strategy, although other agencies are doing more or less the
At FPG they are narrowing the number of photographers they are working with and
pushing those remaining to be more aggressive producers. While some long time
producers get dropped in this process, those that remain, in theory, will get a
higher volume of sales and have less competition.
One of the problems with this strategy is that the marginal producers who get lost
in the shuffle often had a unique style, vision or access that provided a breadth
to the agency's file. Also their images did sell. Unfortunately, demand for such
images was not high enough to put these photographers among the agency stars. Now
the agency stars will be asked to do what they do best, plus fill in the holes left
by those who are no longer with the agency.
The problem with this strategy is that often very talented photographers simply
don't have the skills, contacts or interest in producing images on various
specialist subject matter. Thus, they either do a poor job in covering the subject
or simply don't cover it at all.
On the other hand most of the "specialists" do work that overlaps with some of the
other photographers in the agency and they need to continue selling this other
work. They will be upset if their agent doesn't accept and sell their more general
work. But this work competes with the work of the agent's stars and reduces the
revenue those stars receive.
Trying to keep a few top producers happy while still maintaining a broad based file
is a very difficult balancing act. The classic case of why the FPG strategy may
not work is Comstock. Over 80% of Comstock's images were produced by two
photographers -- Tom Grill and Michael Stuckey. The range of work that these
photographers have produced during their careers is awesome. Yet many feel that
Comstock's weakness is that they lack a "variety of vision." Any individual
photographer is going to be limited in the ways they approach a subject. Someone
will always be able to bring another point of view. Art directors are often
looking for those different point of views.
Maybe Comstock's problem was that they were too narrow. Maybe instead of two it
should have been 20 or 50 or 100. And maybe FPG and others will find that magic
The TSI strategy is more complex. They work with a much larger group of
photographers -- hundreds. But they select so tightly that most photographers --
even many of their top income producers -- get very few new images into the files.
As a result incomes are falling for some of these photographers and they have cut
back on their production. Some photographers are looking around for other outlets
for their work.
As it became harder and harder to get their photographers to produce the new work
they wanted, TSI moved to doing production shoots with a few of their
photographers. In addition to getting what they want in a timely manner, the
agency gets to keep a larger share of the gross fee collected from the sale of the
As some stop supplying new production at the rate the agency wants the agency has
begun to produce some images in-house in an effort to supply a steady flow of new
material and increase their profitability. They make various arrangements with the
photographers. One photographer was offered a shoot for $800 a day plus all
expenses paid up front and a 10% royalty on any sales made from the images in the
first ten years.
This strategy has been productive for PhotoDisc and Corbis Digital Stock, the two
major Royalty Free producers who started in the early 90's to build files from
scratch. However, it is not clear that the strategy will work as well, in terms of
encouraging producers, when a agency is trying to add to a mature file.
On the other hand inside sources tell us that TSI is rethinking this strategy and
is considering an approach more along the lines of the FPG strategy outlined above.
They will work with a few specialists, pay full commissions, and try to insure
that these photographers have steady growth in sales.
It appears that TSI has been disappointed in the return on investment from some of
their production shoots. This could be the result of a number of things. Maybe
the in-house art directors really do need creative input from photographers, not
just button pushers. Maybe TSI couldn't get any of their top shooters to agree to
do shoots for expenses and a small up front fee. Maybe when photographers work for
a fee and expenses they don't work as hard as they do when they have the hope of a
share of sales.
Another factor the TSI producers may have failed to consider is the re-shoot time
many photographers put into producing images when they are paid a royalty. In many
cases photographers are asked to go back several times and re-do images until they
are "perfect" to the editors standards. If the photographer is working on a day
rate that's another fee each time the photographer goes back to re-shoot. I
suspect TSI's production coordinators were reluctant to do as many re-shoots when
they were paying for the effort.
Whatever the reason, expect TSI to back away from fully funded production shoots
and to rely more on working aggressively with a few top producers.
In the past when there was an under supply of images the key to success for most
photographers was volume production. Now, that frequently doesn't work. Agencies
often have so much in their files on any given subject that they choose not to add
new material. Photographers find that even when the new images significantly
update existing images in the file -- like a city skyline -- the editors often
won't select the new images.
Agencies have become very conscious of the costs of putting new images into the
files and the cost of maintaining those files. Consequently, they are cutting back
on the amount of material they accept. They also understand that marketing in the
future will be primarily on-lines. Digitizing and properly keywording images is
much more costly than traditional storage of plastic-sheets-in-file-drawers.
Therefore, it's time for tighter editing.
Some sales still come from the general files, but the majority come from some type
of catalog -- print or digital. Thus, the editors are so focused on editing for
catalogs that in many cases they hardly take anything for the general file. This
varies from agency to agency.
This does not mean that the rejected images will not sell. But, the challenge for
the photographer is to find some way to make these other images available for
viewing by clients. In addition, if your agency will not store indepth coverage of
a subject there is very little point in shooting volume. Many photographers are
discovering that they need to totally change their approach to shooting in order to
satisfy current agency editing requirements.
In choosing an agency it is important to try to determine the percentage of sales
that come from catalog images, the percentage from on-line and the percentage from
the general file. Then find out what you have to do to get your images where they
will be seen. Many agencies are reluctant to provide this information, but the
questions should always be asked. Just being accepted by an agency is not enough.
Photographers are finding it much more difficult to get their work seen. The top
agencies have too many photographers chasing them.
The problem for many photographers is once they produce they can't get their agent
to put the images into promotion.
Photographers with years of experience with major agencies are being dumped by
these agencies. In some cases their rate of production has fallen off and in
others the photographers have found it difficult to change their shooting style to
fit the new editing demands of their agency. In many cases it is not that what
these photographers have producing for years won't continue to sell. It is simply
that the agency has decided it wants to present something different to the buyers.
The major problem with tight editing is that editors -- no matter how much
experience they have -- do not have a perfect understanding of what will be in
demand in the future. The tighter they edit, the more good salable pictures they
tend to leave on the table. The more they look for "edgy" images, the more they
are likely to ignore salable subjects that have long range potential.
The fact that agencies are editing in this way is not necessarily bad for the
photographer provided the photographer is given the option to try to market the
rejected images through another venue.
Photographers need to fight for non-exclusive or image-exclusive deals, but reject
being exclusive to an agency unless the agency is willing to put a significant
portion of the photographer's work into promotional vehicles (print catalogs or
on-line). If the deal is image-exclusive the definition of similars should be
narrow, not very broad as is the trend among many agencies.
Marketing - Print Catalogs
Print catalog generate more dollars in sales than any other marketing vehicle, but
the cost to photographers of putting images in these catalogs is horrendous. Thus,
many photographers are finding that at the end of the day they are not making a
profit on images advertised in this manner.
In June 1998, we surveyed photographers who had advertised in Direct Stock 6. This
book had been in the hands of art directors for more than 16 months. We got
responses from photographers representing more than 28% of the pages in the book.
The average photographer had earned $3,115 and paid approximately $2800 for the
advertising space. A $315 profit from your best images in 16 months is not much to
write home about. Many photographers didn't make enough to pay off their cost of
(See Story 146.)
From conversations we have had with some photographers who are in Direct Stock 7
their returns aren't any better. However, this is not just happening at Direct
Stock. We believe that many of the smaller agency catalogs are experiencing the
same kind of falloff in returns. In some cases photographers don't pay for the
space unless their images sell, but a small volume of sales is still eaten up by
the space charges.
The simple fact is that there are too many images available in print catalogs. The
art directors have lots of choices. The odds that any image will sell frequently
are getting slimmer and slimmer.
Print catalogs are probably still doing better overseas than in the U.S. because
on-line and CD-ROM have, as yet, had relatively little impact outside the U.S.
Another problem with print catalogs is that the big agencies are tending to use
their print catalogs as market position pieces not vehicles for generating sales
for specific images. This affects the type of images they select for their
catalogs (edgy) and the kind of images they pressure photographers to produce. It
may also lead to lower sales per catalog image for some photographers.
The number of buyers using on-line databases to search for images is increasing at
a rapid pace. The costs of making images available on-line so they can be easily
found is much higher than the traditional plastic-sheets-in-a-file-drawer method.
In the second quarter of 1999 Getty Images reported that 25% of their total sales
were e-commerce. Since 85% of these e-commerce sales were in North America that
means that close to 40% of the sales TSI made in North America during the quarter
resulted from searching a digital database either on-line or on CD-ROM.
In August TSI acquired EyeWire and their mailing list of over 300,000 customers who
have purchased graphic arts products.
TSI's on-line site has 76,000 registered users. Picture Network International, a
site with images from more than 60 agencies, has over 50,000 registered users. We
have no idea how many registered users Corbis has, but they seem to make fewer
sales than PNI.
Several Corbis photographers indicate that their share of sales should be between
$3.00 and $4.00 per image on-line for 1999. This is up significantly from previous
years. On the other hand Stock Connection photographers who have images on PNI
will probably earn in excess of $20 per image, per year for each image they have on
PNI for the whole of 1999.
It should also be noted that only a little more than 1% of the images on PNI are
Stock Connection images. We have no way of knowing whether our returns are better
or worse than the other agencies who obviously represent the vast majority of the
Stock Connection photographers also have images on Workbook.com. In the past year
our photographers have received, on average, a little over $15 per image, per year
for each image they have on this site. Approximately 5% of the images on the site
belong to Stock Connection photographers. We do not know the average return per
image for other agencies.
By way of comparison it is also worth noting what ASMP's MPCA on-line service is
producing. In March of this year, Dick Weisgrau told us that MPCA has about 600
qualified buyers who can view the site and that gross sales are in the range of
$60,000 per year. This means that MPCA photographers are receiving, on average,
about $.70 per year, per image on file.
Specialize - Content Specific Images
Some of the photographers who are still experiencing growth have developed very
identifiable specialties. Developing a specialty can be very useful, and is likely
to be more so in the years ahead. The trick with a specialty is to be unique
enough that you don't have too much competition -- and yet not so unique that there
is very little demand.
Many photographers who specialize get immersed in trying to completely document
their area of expertise, and fail to take into account the potential demand for
their subject. Thus, even if 100% of the eventual uses of the subject go to the
photographer, the photographer still loses money because he spent more on in depth
coverage than he earned in usage fees.
Photographers with specialties must keep in mind that some agencies will encourage
them in such production because the agency does not normally share in the
production costs and makes money no matter what the level of sales.
As the percentage of RF uses increases it becomes more important, not only to hold
the line of Rights Protected pricing, but to actually raise fees for these uses.
Unfortunately, some of the major agencies are headed in the other direction. They
are lowering Rights Protected prices in an effort to try to compete with RF. Most
will deny they are doing this, but all photographers have to do is look at their
sales reports to determine if the average fee per use is as high as it was two or
three years ago.
Some agencies believe that something is better than nothing and that they will
"make it up on volume". They believe client who go to RF will never come back.
Unfortunately, for most, the additional volume doesn't seem to be making up for the
These agencies don't consider "cost of production" a factor when setting the price.
All they are looking for is a steady growth in sales revenue.
As the volume of Rights Protected sales decreases, photographer's with unique work
may have to find ways to sell directly so they can control the price, if they can
not find agencies who will hold the line on pricing.
For photographers, pricing must have some relationship to their cost of doing
business and their estimated annual volume of sales. If the number of sales (or
uses) go down and the costs of production, marketing and administration either
stays the same or goes up, prices must go up to cover costs and profit. Otherwise,
the photographer needs to get into another line of work.
Uses vary greatly from major ad campaigns to 1/4 page brochure uses and spot
editorial uses. Price schedules have been based on the assumption that there would
be few of the major uses and a large volume of the smaller uses. Producers could
afford to license rights for smaller uses for fees that were way below costs of
production because they were getting two things:
- a high volume of small uses
- higher fees for larger sizes, larger circulations and multiple
Now the producers who license Rights Protected are losing in both these areas to
They are also losing on larger sizes because some agencies are cutting the spread
in price between 1/4 page and full page or cover. Some agencies (not all) are also
allowing large print runs for basically 5,000 print run prices, and finally, they
often don't push the price for multiple insertions.
Those that do hold the line are finding that hard negotiations are getting much
more frequent. These can be very stressful as the seller tries to determine, "Does
the customer really need this particular image?" and "At what point am I willing to
lose the sale." Our experience at Stock Connection is that more often than not we
get our price and it is usually way above what the buyers tell us they have to pay
for similar pictures at some of the big agencies.
When there are fewer sales the seller should be asking more for each one of them,
Editorial usage rates have been way below what they should have been for years.
The rates set by the publications for the most part have absolutely nothing to do
with the publication's, or the photographer's, cost of doing business.
Publications establish their rates based on the minimum they can get away with
paying while still getting "something" in the way of illustrations to fill their
For years photographers have allowed editorial buyers to get away with this payment
policy because (1) they loved to do editorial work, (2) they expected to make
multiple resales of the images, and (3) they could also do some commercial work and
make up for their editorial loses through commercial sales.
Now these dynamics are changing. Their sales from commercial stock are falling off
and the number of multiple resales to non editorial users are decreasing.
Thus, photographers must fight for more for the initial use as well as additional
for payments for every re-use by the publication. If your stock agency is not
generating significant additional use from other publications see if they have put
any of your images on the PNI on-line site. Many editorial users are using PNI
(www.picturequest.com.) as a resource
and it is relatively easy for your agency to begin marketing on-line.
The Editorial Photographer Group is moving to push up rates. You can join this
on-line forum by going to
The site is password protected and all applicants must be approved by the list
Many in Europe and other parts of the world are more optimistic. I believe this is
for two reasons.
First, a much higher percentage of their sales are for editorial uses and it is
much harder to find RF images that will substitute for such uses. Thus, in the
long run those who shoot editorial subject matter should see less impact from RF.
Second, based on Getty's statistics that 85% of digital sales are in NA, RF must
have had very little impact so far in the rest of the world compared to what is
happening in the U.S. On the other hand this is probably short lived. Within two
or three years photo buyers in the rest of the world will probably catch up to the
U.S. in terms of the use of digital technology. At that point, those looking for
pictures for commercial use will probably make as much use of RF as is now
occurring in the U.S.
Steps for Success
1 - Be selective in what you shoot. Volume production, particularly of
subjects where there are already a lot of images in the files of most agencies
(virtually everything) may no longer be the key to success. The way your agency
edits may dictate the depth of your coverage on a particular subject. It may be
better spending time and money perfecting one particular view of a situation rather
than shooting it ten or twenty different ways.
Before you head off in one direction get a sense of what your agency will accept.
2 - Get your images seen. Before you get too heavily committed producing,
in terms of time or money, expend some effort to get your images seen. Getting
your images before the buyers helps you determine if they are marketable. It also
helps you identify the marketing channels that will work best for you. Many very
creative photographers fail for lack of marketing, or because they use the wrong
3 - Look to stock as a sideline, not a principle line of business. Expect
the income to be add-on, not a major means of support. Keep your day job. Have a
way to support yourself while you wait for sales to develop.
4 - Diversify your marketing. Test various marketing methods. Put some
images on-line, some on CD-ROM, some in print catalogs, some in general files and
carefully compare results. You may be able to do all this through one agency, but
if you can't consider several. Remember the value of getting different editors. It
may even be worthwhile to make some images available through royalty free sources
as a way of comparing results.
In this time of transition you need to experiment with various marketing strategies
and track the results of each with your images. Some strategies will work well for
one person and not well for the next. Most of all stay flexible.
5 - Control costs. Be careful about the amount of work you produce on
speculation unless you have a very reliable distribution outlet with a track record
of stock sales. Re-sell work you have already been paid to produce.
6 - Specialize. Try to find something to shoot that hasn't been done to
death by everyone else. At the same time make sure there is a demand for that type
of image. If you become an expert in an obscure subject where only a few images
are needed are needed worldwide each year, you are not going to make much of a
living from shooting that subject, even if your images are unquestionably the best
on the subject.
You may develop several narrow specialties. One way to find out what has been done
is your specialty is to search the internet, and particularly the on-line photo
sites, for your specialty.
It is easy to overshoot in a specialty. The tendency is to cover it in much
greater detail than buyers care about. You may do this for your own enjoyment, but
from an economic point of view it is very easy to spend much more in producing a
specialized coverage than you will ever earn in fees.
7 - Don't cave in on prices. If your agency is selling at prices that are
too low, look for another agency. If you are making fewer sales at rights
protected rates then the fee for each usage must go up. Think about designer
clothes. They don't sell at off-the-rack prices simply because they serve the same
function as the clothes you can buy in discount stores. Know when the unique
characteristics of your image make it difficult for the buyer to use a substitute.
Be particularly sensitive to holding your price in such situations.
8 - Get on-line. Use e-mail. Learn what is available in this environment.
It is amazing to me the number of photographers who hope to earn income from stock
photography, who are not "hooked up" in any way to the internet and who are
computer illiterate. Even if you don't sell a picture on the internet now, or
plan to in the future, you need to familiarize yourself with the potentials of this
means of communications.
9 - Start a Concept File. Understand who is buying and what they are buying
before they shoot. Clip magazine ads and brochures and add to your files
constantly. Use the file for inspiration. Look for clues to trends, stylistic
changes, gesture, cultural movements which should be mirrored in your stock
photography. Don't copy, but use this resource to learn more about what your
photos might need.
10 - Exclusive vs. non-exclusive. Photographers need to fight for
non-exclusive or image-exclusive deals. Reject being exclusive to an agency unless
the agency is willing to put a significant portion of your work into promotional
vehicles (print catalogs or on-line). If the deal is image-exclusive the
definition of similars should be narrow, not very broad as is the trend with many