January 2003 Selling Stock

Posted on 1/1/2003 by Jim Pickerell | Printable Version | Comments (0)

524

JANUARY 2003 SELLING STOCK




Volume 13, Number 3



©2003 Jim Pickerell - SELLING STOCK is written and
published by Jim Pickerell six times a year. The annual subscription rate is $120.00 to have the printed
version mailed to you. The on-line version is $100.00 per year. Subscriptions may be
obtained by writing Jim Pickerell, 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-251-0720, fax 301-309-0941, e-mail: jim@chd.com. All rights
are reserved and no information contained herein may be reporduced in any
manner whatsoever without written permission of the editor. Jim Pickerell is also
co-owner of Stock Connection, a stock agency. In addition, he is co-author
with Cheryl Pickerell of Negotiating Stock Photo Prices, a guide to pricing
stock photo usages.

Thought For The Month

"Worry is a dark room in which negatives can develop."


Unknown




SELLING STOCK SURVEY



Stock Industry In Crisis


December 18, 2002 (Story 523) - Selling Stock is launching a new survey to assess
stock income trends from the photographer's point of view, and to hopefully draw some
conclusions for the future from this data.


I Strongly Urge all stock photographers to respond to this simple survey. The
deadline is January 31, 2003 .


I have a theory that many photographers are turning away from the production of Rights
Managed stock images because stock image sales no longer generate the kind of revenue that
will sustain their businesses. These photographers are now focusing their efforts toward
other lines of business in order to make a sustainable living. If this is true, there are
many implications for the stock industry's future and for every photographer considering
stock production.


Having some baseline data that either proves or disproves this theory can benefit every
photographer who plans to produce stock images in the future. This survey is designed to
develop such data.


If, on average, a photographer's stock income is rising or staying about the same then the
industry is healthy. If stock income relative to total income is falling for a significant
number of photographers then there might be a big problem. Or it may simply mean that we are
in a "survival of the fittest" mode as a lot of the excess supply is being removed from the
market.


If the photographer's overall income is staying about the same, but the percentage of income
from RM stock is dropping that could be an indication that photographers are already focusing
their energies on other lines of business and moving away from stock production as a source
of income. This could have many implications for how the industry is likely to develop in the
future. Long range the industry may become more dependent on companies who will fund the cost
of production (as is the case with most RF images today).


If income is dropping for everyone across the board it could simply be a function of the
poor economy and a turn around might be expected in the near future.


If the risks in stock production are greatly increasing then producers need as much data as
possible in order to assess their risks.


How Data Is Collected


This survey is being done entirely online. You can respond by going to
www.pickphoto.com/user-cgi/survey_2003.cgi [the 2003 survey is offline] or by
going to SSO website and clicking on the 2003 Survey button. You
can easily print out the survey in order to be able to refer to the questions as you
gather your data.


Responses are totally anonymous. No data is being captured that would enable the
researchers to identify individual respondents. The data will be collated with the
assistance of Integrated Statistics of Woods Hole, Massachusetts.


The more photographers who take the time to answer the more useful the data will be.


Questions


There are only four simple questions. The deadline is January 31, 2003 . The more
photographers who take the time to answer the more useful the data will be.


1 - What was your total income for the following calendar years? (These numbers should
include stock and all other sources of income so we can measure the relative importance of
stock to your overall business. Please provide U.S. dollar figures.)








2000   

     

2001   

     

2002   

     




(We will use this data to calculate a total percent of increase or decrease.)


2 - What was your total stock income in these years? (Please provide U.S. dollar figures
from both RM and RF sales separately.)














     

Rights Managed Images   

Royalty Free Images   

2000   

     

     

2001   

     

     

2002   

     

     



3 - Country of residence ___________


4 - SAA Member Yes __________ No _____________


Thank you in advance for participating.


GETTY ON NYSTOCK EXCHANGE



November 21, 2002 (Story 517) - On November 5th Getty Images transferred its listing
to the New York Stock Exchange (NYSE) under the new ticker symbol "GYI."


The company co-founders, Mark Getty, Executive Chairman and Jonathan Klein, CEO, rang the
opening bell at 9:30 a.m. To commemorate the event outside the Exchange, Getty Images
constructed a photo booth in which Getty Images photographers captured portraits of
passersby.


Getty Images had been listed on the NASDAQ since the company's initial public offering of
stock on July 2, 1996 and traded at "GETY."


ECONOMIC CLIMATE



December 6, 2002 (Story 518) - We're beginning to hear talk of deflation. Is it
coming? What impact will it have on the stock photo industry? The Washington Post says:


"Deflation, like cholesterol, comes in good and bad varieties. The good kind, such as many
of the price declines over the past few years, happens when companies find ways to produce
goods and services more cheaply, usually by making use of new technology or new ways of doing
business. In varying degrees, these productivity gains are passed on to consumers as lower
prices, to workers as higher wages and to shareholders as higher profits. That makes almost
everyone better off.


"By contrast, the bad kind of deflation occurs because there are too few customers chasing
to many goods and services, resulting in repeated rounds of competitive price cutting that
leads to layoffs, falling wages, and a decline in business investment and consumer spending.


    "During bad deflation, consumers and businesses -- knowing that prices are likely to be
    lower tomorrow than they are today -- hoard cash and put off buying things, making the
    recession worse and driving prices and wages down further.


    "Households and companies with lots of debt suddenly find that they have to make fixed
    monthly payments out of deflated wages and revenue. Some file for bankruptcy; some are forced
    to cut other spending to meet there debt service.


    "That was what happened in the early 1930s, triggering the Great Depression. Something
    similar has taken hold in Japan, where prices are falling about 1 percent a year.


    "What worries some economists is that in both of those bad episodes, the deflationary
    spiral occurred after a huge investment bubble burst, leaving the economy with too much debt
    and too much capacity across a broad range of industries.


    "Stephen S. Roach of Morgan Stanley argues that some of those dynamics are now at play in
    the U.S. economy after the worst stock market losses since 1929. 'The risk of deflation is
    higher than at any time in the past half century,' Roach said."

Stock Photo Industry


How does all this relate to the Stock Photo Industry? New technology has not made the
production of the product cheaper. On the other hand, new ways of business -- online
marketing and delivery -- may reduce the costs of marketing the product once we get past the
huge initial investment stage of preparing those images for marketing.


A few large suppliers may have gotten over the top in this "initial investment stage", but
most suppliers are still struggling with the issue of how to cover the costs of the new
marketing strategies while faced with declining sales. Increased numbers of stock photo
agencies are filing for bankruptcy, or going out of business.


Users of images are killing projects in an effort to cuts overall costs at their companies.
In most cases the imagery costs are such an insignificant portion of the total project cost
that the price of images is not a determining factor in the decision as to whether or not to
kill the project.


Image users are not seeing declining costs. Instead they are paying slightly more for both
RF and RM images and RF prices are expected to go up significantly in 2003. For the most part
stock image customers can't "put off buying" because the project has to go forward. But they
can go to cheaper images (switch from RM to RF) or design in a way that requires fewer
images. This seems to be happening. Evidence from Getty's statistics and anecdotal evidence
from reports of many other suppliers indicates that there is strong, continued movement by
professional stock photo buyers away from RM and toward RF.


However, there are other factors that muddy this statistic. Some RM sellers, in an effort to
increase market share in a period of declining demand for their images, are lowering prices
in the hopes of capturing some of the sales going to RF.


In these situations what seems to be happening is that the sellers do not generate enough
new sales volume to offset the lower unit prices and thus their overall revenue continues to
decline. But because the stock photo industry does not have good statistics on the number of
units licensed worldwide, or the average price per unit, we don't really know how much
effect, if any, this lowering of prices is having on:


  • the total number of RM images licensed,
  • the real rate of growth of RF licenses, or
  • if total spending for stock photography is falling and at what rate.

Given the lack of good industry wide statistics -- a thing that is not a problem in most
other industries -- stock photo producers and sellers are left to hope things will get better
-- much as if they were still living in the 1930s -- rather than to plan based on accurate,
up-to-date data and information.


Agencies Not Paying Royalties

We are also hearing of many more cases where stock agencies/archives are not paying
photographers their royalties, or delaying payment due to cash flow problems. The ability for
a seller to sustain itself and exploit its suppliers in this manner is rather unique to the
stock photo industry. Obviously, this eventually discourages suppliers from continued
participation.

A company can often struggle on and continue in bad management practices long after it
should have closed down operations. When a producer places image with an image archive, the
agreement usually is that the producer will be paid 50% or less of the gross fees collected
for any usages. The producer usually has no way to independently determine when sales are
made or money collected, and thus is totally dependent on the archive to supply them with
this information.

At this point I need to say that most archives honestly report this information and make
payments in a timely manner.

But, during periods when revenues decline fixed monthly expenses such as rent and staff
costs continue. There seems to be a natural human tendency to use as much of the cash
available as necessary to pay overhead and operating costs and only after these things are
covered to dole out what is left over to the royalty holders. There is always the hope that
sales will pick up next month and then the archive can make up the difference, but if that
doesn't happen, and overhead costs aren't cut dramatically, the situation continues to
worsen.

In most other industries when companies don't have the cash to pay ALL their debts they
borrow money to keep their business afloat. In the stock industry there is a tendency to
borrow from the photographers without telling them or paying interest. The smaller the
percentage of total revenue the archive owes photographers the less time this can go on
because the archive has less float to work with. When the archive is supposed to be paying
photographers 50% of everything they collect they may be able to extend their life for a long
time by using the photographer's money.

In the case of Pictor Inc. some photographers did not receive payment of the monies they
were owed for years. For well over a year before the company went into bankruptcy, and for 16
months after it filed for bankruptcy, it made virtually no payments to the creators whose
images it was licensing. All monies that came in were used to pay staff salaries, rents and
other overhead.

There is no sure protection against this. Despite written contracts, in the long run
photographers must rely on the ethics of the people operating the archive. Even CreativeEye,
founded by photographers (under the sponsorship of ASMP) as a cooperative venture with one of
its principle goals being the protection of photographers from unscrupulous agents, got
caught in this trap. In August, CreativeEye reported to its member that approximately $30,000
of the money due photographers in royalties had been used to pay operating overhead. The
managers argued that the photographers would have wanted them to use the money to pay
overhead and keep the organization functioning rather than be paid the royalties for the sale
of their images. But they didn't bother to go to their cooperative membership to get
permission for this action.

Photographers used to be able to make some judgements about what they should be receiving
from their archive based on the average return of previous months. Now, with the total number
of RM sales so relatively low the revenue earned for any individual photographer can
fluctuate widely month-to-month. Thus, predicting future revenue has become very difficult
for RM sellers and determining whether the archive might be withholding payments based on the
reports received by any one photographer is impossible.

Effects On Production

An increasing number of stock photographers -- the suppliers of the RM images -- are in
financial straights. They are dropping out of the market and reducing new production. Some
have other options and their livelihoods have not been seriously threatened. They have been
able to move away from a dependance on stock photography revenue and ramp-up other lines of
business in order to maintain a fairly stable level of income.

On the other hand many experienced shooters trying to stick with stock photography
production as a principle line of business are, with few exceptions, finding that they can't
get anything near the number of images accepted for marketing as they did in the past. In
addition, the images that are accepted don't generate anything like the revenue a good stock
image would have generated a few years ago.

It used to be that if a photographer increased production sales would increase. This worked
because a significant percentage of ALL production was made available for customer viewing.
It also helped that there was a growing demand for RM imagery in the 1990's. Now very tight
editing due to the costs of making images available online has drastically reduced the
acceptance level and limited the customer's choice. And demand appears to be declining.

Photographers are still free to produce as much as they want, but if they don't have an
effective way to show ALL their production to the buyers they are just throwing production
money down a rat hole. Long range, this probably means that photographers will reduce
production even more than is the case already.

As a result of digitization and online marketing a huge numbers of analog images have been
removed from the market and returned to photographers. It is now impossible for customers to
find a great percentage of these images. This has not only narrowed the supply, but resulted
in lost revenue. Photographers are struggling -- mostly unsuccessfully, at the moment -- to
find a way around these problems. If a satisfactory solution doesn't develop soon many
producers will slowly fade from the scene.

This reduction in new production may be reason for concern for companies that earns their
sole livelihood from the licensing of stock photography. On the other hand there is general
agreement that during the ramp-up period of stock in the 1990s a huge over supply of imagery
developed. The current reduction in overall supply may be good for those who already have
images in the supply chain (the online sites). It doesn't bode well for suppliers who are
still on the outside, or whose images have been removed from the market.

Images Customers Want That Are No Longer Available

Given the move to tightly edited online systems there are certain images -- once available
at stock agencies -- that some customers want to use, but which can no longer be found. These
images tend to be of subjects needed by small specialized industries or book publishers. The
argument for no longer making these images available is that the costs are prohibitive when
compared with the limited revenue the images might generate.

The costs of scanning, keywording and administration are too great to justify making these
images of marginal demand available online. Also since a very high percentage of all images
used can now be found online, the costs of maintaining the old analog systems, and the
researchers needed to service them, can no longer be justified for the marginal additional
revenue these files might generate.

These are legitimate arguments. So far no good solution to making the marginal images
available has been offered. Companies that have attempted to continue to make analog images
available seem to be proving the theory that the costs exceed the revenue generated.

Unfortunately, this means that many buyers will encounter more difficulties in finding the
variety of imagery that used to be available to them through stock. The hope of the sellers
is that these buyers will settle on images that are available online even though they may not
be exactly what they need. The other options for buyers are:

  • to work harder to find something from a non-traditional source when the offering from
    the online portals are simply not sufficient of satisfactory,

  • to hire someone to shoot it and end up paying much more than what would have been the
    case if the image were available as stock, or

  • get along without an image.

Final Thoughts

  • There will be a decline in business investment for the creation and marketing of Rights
    Managed photography.

  • The industry has too much capacity and too many images chasing too few customers.

  • Customers are not hoarding cash waiting for prices to go down, but opportunities to
    ever make certain sales are being lost due to the general state of the economy.

  • Accurate statistics to aid everyone in the industry in their future planning are badly
    needed.

  • Producers will be hurt more than image sellers.

  • Buyers choices are being limited.

    Technology advances are benefiting many customers, but in the long run a large number of
    customer will view the limiting of their choices as an "unfriendly" act by those who produce
    and sell stock images.

    The stock industry's problems are not the result of deflation, but a period of deflation is
    likely to make them even more difficult to overcome.


    RF RIGHTS STANDARDIZATION


    December 6, 2002 (Story 519) - What rights do you get when you purchase a Royalty
    Free images? Many buyers think they get all rights to do whatever they choose with the images
    they buy, but if you dig through the fine print in the licenses that isn't true.

    Recently, a publisher of children's books decided he could save money in the future by using
    RF instead of RM images. This publishers has 24 titles with about 15 images per title. He
    proposed to completely re-edit all the titles and replace the RM images with RF. This, he
    thought, would eliminate his having to pay additional fees based on circulation, or when he
    sells the rights to publishers in other countries to re-publish his books.

    It's clear enough that he use RF images in for almost any product his company wanted to
    produce. But what about the other publishers who would translate the content into their
    language and might reformat it in order to produce a book that would sell well in their
    territory. The question was whether the publisher was allowed to take this second step for
    the basic one time fee?

    In the early days of RF the publisher would have needed to purchase a resale license for
    products such as books, mugs, teeshirts, etc. The cost of a resale license might have been in
    the range of $250 per image. However, in 1998 PhotoDisc changed its license and eliminated
    the need for a resale license. Most other publishers followed suit.

    When the above publisher contacted Getty the sales person said that only the normal fee was
    required for such a usage as long as the product remained the same. (It is unclear why it has
    to be the same product because once someone purchases an RF image they can use it in multiple
    ways so long as they are the end user.)

    Corbis said that if the "end users" are different each "end user" would have to buy a new
    license. Jerry Kennelly, CEO of Stockbyte says, "if the prime publisher is reselling the
    content in a digital format (other than postscript files or a locked down PDF) it is a
    re-use."

    On the other hand if the buyer of the RF images is the publisher Bertelsmann or AOL Time
    Warner -- companies that buy up everyone -- can any of their "divisions" legally use the
    image?

      (One thing to note here is that RF is really not that "hassle free" when you're a
      publisher trying to figure out how to do the right thing. If the images you intend to use
      come from several different RF companies and you need to carefully read each company's
      license - and probably get legal interpretation - to determine what uses are allowed.)

    Standardization


    There is no recognized industry standard for what is, and is not, permitted when a buyer
    purchases an RF image. As a result many buyers just go ahead and do anything they want with
    the RF images they purchase.

    Kennelly believes that RF producers should establish some universal standards that are
    accepted by all the players in the industry, publish them widely on a web site called
    RFlicensing.com and then join the Business Software Alliance (bsa.org) to pursue enforcement
    of their licenses.

    At the PACA International Conference he estimated current worldwide RF revenue at about $300
    million and said the industry could be earning $500 million if customers were paying for all
    the unauthorized uses they are making. That's 67% additional revenue -- with no price
    increases.

    Kennelly praised Henry Scanlon's new approach at Comstock where the buyer is required to
    designate the end user in Comstock's Flat Fee pricing model. He believes that the end user
    should be designated on every license, and would gladly adopt that policy at Stockbyte if
    others in the industry would join him.

    Among the concerns are designers who buy a disc for one customer's project and then hold
    onto the disc and use the images for future projects for different customers. Also many
    customers are placing discs on inhouse servers that can be accessed by many users. The normal
    license fee is for a 10 "seat" access, but it is not uncommon for more than this number of
    users to have access to and be using the images. In such cases the customer should be paying
    for an extra seat license.

    Sensitive Issues


    Another concern of some RF producers is how some of their images are being used to
    illustrate sensitive subjects. For example a major international newspaper recently used an
    RF image to illustrate a story on increased sexual activity among young people. The models
    were clearly recognizable. The model release probably covers the producer -- in a legal sense
    -- but the producer is having some "moral" misgivings because the models had no idea they
    were being exploited in this way.

    This is only one example of this type of use. RF images are being used everyday in a variety
    of sensitive issue situations. To some extent the producers have only themselves to blame
    because from the beginning RF has sold itself as providing "fully released images" which you
    can "use for anything." Buyers who can't find someone who will sell them rights managed
    images naturally gravitate to RF. Consequently, virtually all the people who deal with issues
    that are politically or ethically sensitive to one group or another rely on RF images to
    illustrate their products.

    Some RF producers believe this is a time bomb waiting to explode -- particularly if models
    happen to vacation in some of the more sexually liberal countries and see how their images
    are being used. Or if some of the world's out-of-work lawyers recognize this as a
    opportunity.

    A lot of this problem could be eliminated if there was a site like RFlicensing.com that
    contained a universally accepted statement explaining in clear, simple language that uses of
    the images to illustrate sensitive issues are not permitted unless the user has obtained a
    specific release for that use. This language should also clearly obligate the user and make
    him fully liable if such a use is made without specific permission.

    Observation

    While these changes would likely benefit the industry, and probably even earn all the
    producers more money, I am skeptical that producers will be able to agree on a universal set
    of terms. There is too much temptation to try to retain a marketing advantage by offering
    something slightly different.

    Also, because Getty controls such a large portion of the RF market it really boils down to
    what Getty decides to do. At any rate for those of us sitting on the sidelines it will be
    interesting to watch.


    TIGHT OR LOOSE EDITING


    November 21, 2002 (Story 516) - When marketing images online, is it better to have
    them on a tightly edited site that offers a limited selection of the best images currently
    available on each subject, or on a site that has a depth of coverage in each particular
    subject area?

    There are advocates for both sides of this issue. The "loose edit" advocates (of which I am
    one) argue that customers have a broad range of needs and it is impossible for any editor to
    anticipate the wide range of future uses that customers might make of images. Thus, in the
    interest of trying to offer images that will meet the needs of every customer and maximize
    the number of sales, it is better to provide a broad range of images. (This presumes that the
    quality of each image offered is excellent.)

    When looking for Rights Managed images many customers want something unique that illustrates
    a common theme. When the choices are limited the chances are greater that someone else will
    have used the image.

    This strategy makes it possible for customers with widely varying needs to find something
    that will work for them. It also makes it possible for a greater number of creative ideas, as
    expressed by various creators (photographers), to find a place where they can be seen.

    The "tight edit" advocates say the above strategy results in too many hits on any particular
    search, and most customers want a more focused selection of images to review. They say
    customers will not spend the time necessary to review a large number of images and will tend
    to go to sites where the choices are more limited.

    They also theorize that the ability to sell is predicated on being at the front of the queue
    in any given search because the buyers will select the first image that fits their criteria
    and not search further. (There is no public data available that would prove that
    professionals searching for images operate this way, but supporters of the idea argue that it
    is human nature.)

    It is believed that due to the limited time most customers have to search they will jump to
    another site if they don't find the image they want right away and will not go to sites that
    are not tightly edited. Thus, these sellers argue, that it is extremely important to keep the
    queue on any search short.

    PACA Art Directors Panel


    At the recent PACA 7th Annual International Conference a panel of four art buyers/art
    directors/graphic designers offered a client's perspective on what they wanted when searching
    for stock images. They were: Norma Villafana of MARC USA, Jose-Guillermo Diaz of Ogilvy &
    Mather, Sean Martin of Beber, Silverstein Advertising and Rafa Rosa of Pink Haus.

    At one point I asked the question, "If you get many hits on an image search, how many
    screens are you willing to go through to find the right image for your project before you
    move on to another site."

    There answers were revealing, although it must be recognized that the strategy of these
    image buyers may not be totally representative of all who buy stock photography.One said that
    he went through 1,500 images on one project to find the image he used. Another said he spent
    two days searching various online sites to find the right image. They pointed out that even
    if they find an image early that will work, they will often keep going in the hopes of
    finding something even better. They emphasized, "That's our job. It's not to just find
    something that will work, but to find the best image for the project."

    They pointed out that what turns them off is not the total number of images generated by a
    search, but whether most of the images are "appropriate" to what they were asking for. For
    example, it they asked for a "couple on the beach with a dog" they want every image to fit
    those parameters. With some search engines for this search they would get couples in
    non-beach situations or without a dog. When that happens they leave that site quickly.

    They explained that if they can get 90 images per page, (as Gettyimages.com and some other
    sites offer) they don't mind looking through a lot of images. If the site only allows them to
    download 9 or 12 images per page they are more reluctant to go through a lot of pages because
    the time consuming part of the process is the page refresh, not reviewing many thumbnails.

    These buyers also liked the feature that is on Getty Images (and a few other sites) that
    asks them which meaning they are looking for when a word might have more than one meaning.
    For example if the word used was "turkey" Getty asks: "are you looking for Middle East, white
    meat or poultry."

    These buyers seemed to fully understand how to use keywords to narrow their searches. On the
    other hand Norma Villafana pointed out that sometimes when she is not sure exactly what she
    wants she will use a broad term in the hopes of seeing something that will result in a
    serendipitous experience that will push her in a particular direction.

    They like sites that offer a list of keywords that are connected with each image. Sometimes
    when they find an image that has some of the elements they want they will review the keywords
    and one or more of them may give them another direction to pursue. They also like sites where
    they can search by photographer name. Thus, if they find a particular image style they like,
    they can pull up other images by the same photographer to see if something else works better.

    Natural Language

    We need to examine the "couple on the beach with a dog" type of search more closely to
    understand why these buyers sometimes get inappropriate hits with such a search. Basically,
    there are two methods of search -- keyword and natural language -- and sometimes they are
    combined.

    With a pure keyword search only images that include all the keywords -- "couple", "beach"
    and "dog" -- will appear, assuming the images are properly keyworded. With natural language
    the images that have all three elements should come up first. But after that the search
    engine will show pictures that include any two of these three elements and then any one of
    the elements. It is these additional pictures that seem to upset these particular photo
    buyers.

    While the images that have all three keywords should come at the top of the queue, for some
    reason that doesn't always seem to be the case with natural language search engines. And it
    is usually difficult to know where the cut off point of appropriate images is located.
    Another frustration with natural language is that when buyer attempt to narrow their search
    by using additional qualifying words they will get more hits, rather than less, and often
    nothing that is precisely on target.

    Thus, the problems photo buyers have with inappropriate searches may not have as much to do
    with the number of images on a site as with the search technology being used.

    When online search was first developed, there were few images available, and natural
    language search produced more hits on every search. This made it appear that the site was
    more heavily populated with images than might really have been the case. In the early days
    this could be an advantage. It was also felt that if the buyers saw images other than what
    they had originally started to look for they might have a "serendipitous experience" and buy
    something they had never thought to ask for.

    Now, the technology and the experience of the professional users has advanced to the point
    where they don't need to look at inappropriate images. If the keywording has been done well
    and the search engine only looks at keywords, it is a simple matter to narrow any search by
    adding additional qualifying words. The professionals seem to be comfortable with this
    approach. On the other hand, as Ms. Villafana pointed out, if she doesn't have a specific
    image in mind and is just looking for ideas she can always use more general keywords to get a
    broader range of imagery.

    How Many Keywords?


    The "loose edit" people generally believe that many keywords (provided they are all
    appropriate to the image) are helpful because they enable the art buyer to use multiple words
    to narrow their searches.

    The "tight edit" people generally advocate using only a few keywords and focusing on general
    categories. They usually believe that more keywords will result in more images on any search
    which should not be the case if the keywords are appropriate to the image.

    Professional or Amateur Buyers

    The issue of whether a tight or loose edit is appropriate may depend to a great extent on
    whether you are selling to professional of amateur buyers. The amateurs may have less
    patience, and may not be as experienced in knowing how to use the custom features of an
    agency site. Therefore, it may be necessary to keep their choices simple because they tend to
    use broad general words rather than trying to narrow their searches with specifics. Also,
    they may be more inclined to accept any image that generally fits their need and price range,
    rather than spending a lot of time searching for just the right image.

    The professional buyers knows how the use the technology and they are more concerned in
    finding the perfect solution to their problem. They are willing to spend time so long as the
    searches generate appropriate imagery.

    In summary, when aiming at the professional buyer more images may be better if the search
    engine makes it easy to narrow the search.


    NATIONAL GEOGRAPHIC GOES ONLINE


    December 18, 2002 (Story 522) - The National Geographic Image Collection has launched
    an online site at www.ngsimages.com with an initial
    offering of 10,000 images from its
    archive of 10 million images. It expects to add about 3,000 to 4,000 new images per year to
    the online collection.

    Since 1995 Geographic has been selling images commercially, but their marketing has been
    done the old-fashioned way, through glossy print catalogs -- and, of course, the monthly
    magazine which is where many buyers find the images they want. By going online they hope to
    make more sales to ad agencies, magazines, corporation, textbook firms, etc. Their goal is to
    triple revenues in the next three to five years.

    The Image Collection, operated by Maura Mulvihill, handles the work of 140 full-time
    freelance photographers who work for National Geographic and it currently sells between 600
    and 1,500 images per month. Photographers get a royalty of between 40% and 60% of the gross
    fee received by Geographic for the licensing of the images based on their volume of sales.
    (As the volume increases the royalty percentage increases.) According to Mulvihill,
    "photographers with lots of images in the collection earn $60,000 to $80,000 per year, and
    some even a little more while newcomers might earn $7,000 to $15,000."

    Image Collection/Panoramic Images Collaboration

    Geographic has also announced that Panoramic Images will be marketing images through their
    site. They expect Panoramic to start with about 2,000 images and the first ones should
    available on www.ngsimages.com site early in 2003.

    Bill Perry said, "We were looking for a quality company to help us leverage our site.
    Panoramic Images has imagery that is compatible, but not competitive, with what we currently
    offer. They have a niche like we do, and provide top quality within that niche."

    Panoramic Images will be responsible for selecting the images that it places on the site. It
    will provide the scans, keywords and all necessary model and property releases. It is
    expected that Panoramic will supply JPEGs that are approximately 25 MB in size for use in
    servicing National Geographic's customers. In the event that a customer needs a larger file
    Geographic will go back to Panoramic Images on a case by case basis to obtain it.

    Geographic retains the right to reject any image for quality, or if it feels the image is
    too competitive with the work of their own photographers. Geographic will be responsible for
    all negotiations and licensing and will retain an undisclosed percentage of the fee for their
    services.

    Perry says that they have an "open mind" about doing similar deals with other images
    suppliers, but they intend to move slowly in that regard. They want to see how the Panoramic
    Images collaboration develops before considering other suppliers. "We probably wouldn't add
    images from a nature and wildlife agency because we already have such a strong file of that
    type of material," he said.

    Doug Segal of Panoramic Images says, "We are proud and pleased to be associated with
    National Geographic."


  • Copyright © 2003 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 301-251-0720, 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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