Is Piracy The Problem?

Posted on 7/22/2009 by Jim Pickerell | Printable Version | Comments (1)

In a recent speech outlining a new medium-term strategy for a “digital Europe” the European Union’s telecommunications chief Viviane Reding noted it is not piracy that is destroying the recording industry's business model, but a failed business model that is leading to piracy. “In my view, growing Internet piracy is a vote of no-confidence in existing business models and legal solutions. It should be a wake-up call for policy-makers,” she added. This statement applies as much to the imaging industry as the recording industry—and it should be a wake-up call to business owners.

Traditional image sellers have lately focused a great deal of energy on finding and punishing unauthorized image users, while giving scant consideration to the possibility that the core problem may be a flawed business model in need of radical change. The first step is to recognize that most photography consumers are not determined to steal if they can. Many will pay for the right product: one that is easy to find, is sold at the right price and comes with good service. If everyone operating in the Internet environment were insisting on free content, why are so many new customers paying for the images they need?

Prior to the introduction of microstock, an estimated 5 to 6 million traditional stock images were licensed per year—not counting images licensed on subscription. For a number of years, year-to-year changes in image volume and price were small. In the 3 or 4 years since microstock took off, there has been a slight decline in traditional sales as some customers find the images they need on microstock sites. But microstock sales to traditional customers probably represents 100,000 to 200,000 images annually—a very minor part of the total microstock business: I estimate that in 2008, over 50 million images were licensed worldwide at microstock prices.

Where did these new customers get images previously? Only three options come to mind. They either did not use them, stole what they needed, or photographed it themselves. Now, they are paying.

The photography industry is not the only place where customers are paying for things they might otherwise be able to get for free online. Customers paid $3.34 billion for iTunes content in 2008, a 34% increase over 2007. Much of this content could have been acquired through file-sharing.

Most consumers recognize that creators are entitled to compensation for their efforts. Many will pay something, as long as they consider it reasonable relative to the value they expect to receive from owning it.

Granted, current microstock prices may be too low to enable most creators to be adequately compensated for their efforts. But, in many, though probably not all, cases customers would be willing to pay more, given the value they will receive from the use of the image.

This is not to say that traditional stock sellers should drop all efforts to identify and prosecute infringers. However, they should also commit an equal amount of effort toward examining, and being open to, radical change in the existing business model.

Here are a few of the modifications and improvements that traditional sellers can consider:

  • A system that enables every images to be made available to all potential customers;

  • A simple pricing system, but one that makes it possible for any customer to afford any image based on the value that customer will receive from using the image;

  • An improved search system that makes it easier for customers to quickly find the best image for their particular needs. Traditional sellers should adopt many of the ideas implemented by microstock sites;

  • Eliminating the efforts of certain sites to exclusively control the content of certain producers, which limits the potential revenue of that producer;

  • Reducing emphasis on selling exclusive rights to stock images and focusing on making multiple non-exclusive sales;

  • Making it easier for creators to distribute their content through multiple sites;

  • Standardizing technical and submission requirements to make it easier for creators to upload images to multiple sites for consideration;

  • Making more statistics related to global demand available to creators planning future productions;

  • Making it possible for the creator to be aware of every sale of their work the instant it is made, and making it possible for the creator to withdraw funds whenever the royalty account balance exceeds $100;

  • Offering credit-based payment options through traditional agency Web sites; and

  • Increasing the focus on selling directly to consumers and de-emphasizing corporate sales.

Some of these ideas will be considered anti-agency, but can the agency system survive long without adopting some, if not many, of these changes? In the future, the differentiating characteristics of agencies should be how they edit, present and market their collections and their customer service—not how tightly they control and exploit their suppliers.

Copyright © 2009 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, 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:  


  • Jonathan Ross Posted Jul 22, 2009
    The world has people that will steal before they pay a penny, has and probably always will. That is just part of our society. No matter how well you design you site there are still going to be people that will try to find a way around paying, usually justifying the theft by telling themselves this is a big corporate company that is screwing them already. No matter what size the company is, us and them thinking. I do not think there are a great deal of buyers who are stealing because they can't figure how to find the right image or can't figure out the payment method. We all lose sales on theft from our images and music as well as film and print no matter how you sell it. I think you have to work the cost of the loss into your business model and spend what effort you can on policing the problem. It can be policed to some degree with much more severe and regular penalties but you will never stop it completely.

    Jonathan Ross

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