Pickerell six times a year. The annual subscription rate is $80.00 to have the printed
version mailed to you. The on-line version is $72.00 per year. Subscriptions may be
MD 20850, phone 301-251-0720, fax 301-309-0941, e-mail: firstname.lastname@example.org. All rights
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
stock photo usages.
magazine and book publishers, and commercial photographers worldwide. All these
except other photographers are potential users of your images.
from Corbis, Kasz Maciag from PhotoDisc and Drina Lazar from EyeWire.
fundamentally damaging to the long term interests of photographers. In addition,
platform from which they could make a sales pitch to ASMP members. Because of
could schedule private consultations with the various speakers. Riess said,
Becker-Leckrone from Corbis. Evidently, after that program, ASMP decided that
their message relative to stock was not being presented strongly enough.
and that photographers be given the right to establish the level of debt the
agency can incur on their behalf, and that images may not be held as collateral
for such debt after termination.
Selling Stock Editorial Position
Before leaving this topic, I need to say a little about Selling Stock's
editorial position. ASMP's goals are admirable. However, sometimes it is
necessary to temper admirable goals with a dose of reality.
Back in 1992 many of us were opposed to "clip" photography. Seven years later
our industry has changed dramatically and photographers need to understand
current realities, not be locked into out dated policies and modes of thinking.
In 1999 we must recognize that approximately 15% of the total gross sales
worldwide of stock photography are "royalty free" images. This percentage will
continue to rise before there is some balance between RF and RP. RF is here to
stay. RF has a share of the stock photo market and some photographers will
produce RF pictures in the future.
A few photographers are making very good money producing RF images. We have
reported on some of these in an extensive story on PhotoDisc last summer. Story
139. RF is certainly not the marketing solution for every stock photographer or
for every type of imagery, but RF is having an impact on the business that
photographers would be foolish to ignore. Clients are happy to use RF for many
of their projects. We believe it is important for photographers to assess, in
light of their own situations, both RF and RP (rights protected) marketing.
Virtually all the major marketers of stock images are involved in RF in one
form or another. This includes: Getty Images, The Image Bank, Corbis, Comstock,
Index Stock Images, VCG (who say they will be starting an RF division in 1999),
PNI, etc. To reject an agency simply because they have an RF division, or
because they have undesirable policies in their standard contract severely
limits your chances of selling stock -- period.
The important thing is to learn how to identify the best offer and negotiate
the best deal for your particular situation. Photographers who want to license
rights to their images need to figure out how they can co-exist with RF, not
waste energies and resources trying to eliminate it.
Photographers need information. They need a better understanding of why art
directors use RF. They need to understand the strengths and weaknesses of RF.
They need to watch the development of this segment of the industry as closely as
they watch the development of the rights protected segment. They need to be
constantly re-assessing their options. To help in this, Selling Stock will
continue to provide in depth reporting on both the RF and the RP segments of the
stock photo industry.
Story 204 GETTY E-COMMERCE SUCCESS
February 9, 1999 - Getty Images, Inc. has reported earning for the fourth
quarter of 1998 at $50.1 million. This was 96 percent over the fourth quarter of
1997. Total 1998 sales were $185.1 million.
Electronic commerce sales, in the quarter, reached more than 15 percent of
total sales. Digital sales (including CD-ROM sales) in the quarter were $18
million, representing 36 percent of total sales. Digital sales for the year were
$59 million, representing 32 percent of total sales.
In the fourth quarter, Getty's largest brands, PhotoDisc and Tony Stone Images,
performed well and showed particular strength in electronic commerce. The
electronic commerce sales of PhotoDisc, acquired in February 1998, increased by
92 percent in the fourth quarter over the equivalent quarter of 1997 and
e-commerce sales accounted for 47 percent of total sales in North America.
In the fourth quarter, more than 15 percent of total sales, or about $7.5
million, were e-commerce sales. TSI full e-commerce site launched in October
1998 has exceeded the company's expectations. Over five percent of TSI's North
American sales were generated online by the end of December 1998 and, of these,
25 percent were new customers.
This initial success for Tony Stone Images continued into January 1999 when
e-commerce sales in North America represented over 10 percent of total sales.
Sales on http://www.tonystone.com, in January 1999 alone, equaled total
e-commerce sales for Tony Stone Images in the whole of the fourth quarter of
It should be noted that "full electronic commerce" does not necessarily mean
payment by fixed fee by credit card and on-line delivery. While the sites offer
this capability, it is believed that in a significant percentage of cases the
TSI fee was negotiated and that delivery was by some other means other than
direct on-line delivery. When questioned on this point sources were unable to
E-commerce sales at PhotoDisc in the fourth quarter of 1998 represented 37
percent of total sales for that brand. In January 1999, PhotoDisc's e-commerce
sales represented 40 percent of total sales.
Electronic commerce sales at PhotoDisc, as a percentage of total sales, grew
from 19 percent at the end of 1997 to 35 percent at the end of 1998. Getty
believes that it is possible for the company as a whole, over the medium term,
to reflect the margins achieved at PhotoDisc.
PhotoDisc's e-commerce sales for the full year increased by 156 percent, over
1997, to $20 million. In October 1998 alone, $2.3 million was generated on
http://www.photodisc.com. Getty launched a new PhotoDisc web site in February
1999 that contains greater functionality and improvements in customer service,
including the addition of account self-maintenance and monitoring abilities.
Getty's Preview service, which allows customers to use in house expertise in
searching for imagery while utilizing the company's online delivery of
selections and orders, continues to prove popular among Tony Stone Images'
customers. Getty believes that the service is effective at ensuring that
specialist image requests can be met digitally and that the service can help to
alleviate customer deadline pressure. In addition, Getty believes that the
service provides an excellent training ground for full e-commerce usage amongst
all customer sectors. Due to its success, the company has extended the service
to include its expansive historical collection, Hulton Getty.
During the next twelve months Getty will invest in enhancing functionality and
valued added services on their existing web sites. In addition, Getty will
continue to e-commerce enable relevant parts of the company's content in order
to provide imagery in a hassle-free web environment.
In the third quarter of 1999, Getty plans to enhance the separate successes of
existing web sites by providing the creative market with a hub web site, with
e-commerce capabilities, containing imagery from some of its leading brands:
Tony Stone Images, PhotoDisc, Allsport and Hulton Getty. Getty believes that
existing and new customers will be eager to take advantage of this broad
selection of high quality imagery.
Getty intends to continue a strategy of integration during the next twelve
months. Liaison and Hulton Getty share offices and management in North America;
Tony Stone Images has extended its customer base to Liaison in 1998 and will
provide the same benefit to Energy Film Library in 1999.
Story 196 EYEWIRE LAUNCHES PORTAL SITE
February 1, 1999 - EyeWire, Inc. (formerly Adobe Studios) will develop a
first-of-its-kind resource that will provide visual content - such as video,
animation, photography, type fonts, illustrations and clip art -- and related
graphics software, products and services within a single Web site: EyeWire.com
EyeWire's key target market is the creative professional community, whose
functions include graphic design, advertising, Web site creation and multimedia.
According to EyeWire there are 500,000-plus professional graphic designers who
regularly design and produce for print, broadcast and the Internet engaged in
this industry. They spend several billion dollars annually on products and
EyeWire's goal is to develop a site that will be a one-stop resource for all
the needs of graphic designers, creative directors, art directors, broadcast
designers, Web site designers, multimedia designers and desktop publishers. The
site will also be of use to people charged with developing graphics materials
who are within the small business community, the education industry, and
Currently, people developing professional business communications are forced to
find and purchase content, products and services through multiple sources, many
of which are not found on the Internet. Using its own products and a rich suite
of products/services from industry partners, EyeWire.com will create a
time-saving "one-stop shop" that will provide:
- Graphics professionals with the industry's most comprehensive selection of
visual content, a diverse range of editorial features and how-to's,
opportunities to buy and sell related products and services online, and the
ability to enhance their expertise through participation within their own online
- Business users with "content on demand" that offers the right visual
solution - typeface, graphics or multimedia - or service, such as printing or
distribution, without demanding that they do any sourcing or even leave their
Both markets will be served by EyeWire.com's MyWire "personal portal" that will
allow users to build their own site that features favorite products and
services; individualized information, such as pertinent articles, industry trade
shows or competition deadlines; and personalization capabilities, such as
flexible "look and feel" tailoring and support for multiple foreign languages.
Key to the EyeWire.com initiative will be leveraging the EyeWire core customer
base, which has been derived from the company's industry-leading direct mail
catalog and customer service operation.
"Becoming a portal -- even a vertical portal -- demands traffic, which we
anticipate will come largely from converting our catalog customers to Web-based
customers. We have a built-in traffic generator based on our record as the
leading cataloger for visual content," said Brad Zumwalt, Chairman and President
of EyeWire. EyeWire has mailed over 50 million catalogs to date. Currently
they mail about 800,000 catalogs a month to business and professional graphic
arts users. Their mass mailing program has been developed and refined for over a
decade and is supported by EyeWire's telephone and Web-based customer service
Much of EyeWire's royalty free image collection has been provided by
SuperStock. EyeWire also distributes the Digital Vision collection from the
U.K. as well as other royalty free products. A key resource which designers use
extensively, and which EyeWire currently does not supply, is "Rights Protected"
photography. Look for EyeWire to offer RP images to their massive customer base
in the near future.
EyeWire was founded in 1985 (then known as Image Club Graphics) as a
distributor of individual digital typefaces. They were acquired by Aldus
Software in 1994. Aldus was purchased by Adobe Systems in September 1994.
During its four years as an Adobe subsidiary, the company grew more than 450%.
In the fall of 1998, company management reacquired the transformed company from
Adobe, naming the newly independent organization EyeWire Inc. EyeWire has a
growth rate of 50% per year, plus profits and revenue exceeding $20 million.
Holli Morton , Director of Sales and Personnel at WestLight, has retired
after completing the integration of WestLight into Corbis. The WestLight name
has disappeared. Holli is sister of Craig Aurness, Westlight founder.
Matthew Klipstein and Charles Smith , founders of Digital Stock are
wrapping up their relations with the company after the acquisition by Corbis.
They will be leaving shortly.
Photographer Randy Taylor has joined Liaison as Vice President of their
Lewis Blackwell will join TSI this month as Creative Director. He is
responsible to drive and develop TSI's creative outlook. He replaces Stephen
Mayes who resigned in early 1998.
Gary Elsner , former VP of Sales and Marketing at FPG, has established his
own consulting firm supplying a variety of services to stock agencies and
See the on-line version of Selling Stock for more details of each of these
Story 192 PICTURE PERFECT IN ARREARS
March 8, 1999 - Picture Perfect and Todtri Productions, Inc. are seriously
delinquent in their payments to stock agencies and photographers. Both
organizations are owned by Robert Tod and based in New York City.
Todtri Productions is a publisher of picture books and has obtained pictures
from a number of U.S. and foreign stock agencies. The first public indication of
trouble came in mid 1998 when Art Resources reported to PACA (Picture Agency
Council of America) members that Todtri had failed to pay them for many pictures
used in a number of Todtri books. The books in question had been released and
distributed a year, or more, earlier.
At one point the total usage fees owed to Art Resources was about $80,000.
Early in 1998 Todtri made a few payments after repeated requests by Art
Resources. By mid-1998 those payments stopped and Todtri would no longer respond
to telephone calls. They still owe Art Resource about $42,000.
At that time Robert Tod told Selling Stock he was having some cash flow
problems because book distributors were delaying payments to him for some of the
books they had purchased. He also explained that distributors were returning
many more unsold books than had originally been anticipated. It is a practice in
the industry that book stores can return unsold books for full credit. Tod
assured Selling Stock at that time that all payments would be caught up soon.
Meanwhile in late 1997 and early 1998 Picture Perfect released its PP12 catalog
containing about 2100 images. Over 900 of these images were supplied by Nawrocki
Stock Photo Inc.. Zepher Pictures and a number of foreign agencies also
supplied images for this catalog.
2 A few photographers supplied images direct to Picture Perfect rather than
going through another agency. We have been unable to locate a single
photographer or stock agency who has received any payment for images licensed
through this catalog.
Picture Perfect handles all sales in the U.S., and has distributed catalogs
through between 20 and 30 agencies outside the U.S. In most cases, the foreign
agencies are required to remit 60% of the gross sales to Picture Perfect in New
York. We believe that about 100,000 catalogs have been distributed around the
world with 30,000 to 40,000 of them being distributed to U.S. buyers.
Not only have image producing agencies and photographers not received payment,
but as of the beginning of 1999 only one agency had received any type of sales
Photographer Andy Goodwin had a picture of his two sons used in a major ad
campaign by Kellogg foods. As of the beginning of 1999 Picture Perfect would
not tell Goodwin, or his agent Nawrocki Stock Photos, what they billed for this
usage. Goodwin later learned it was $10,000, but he still has received no
We know that some foreign agencies have made sales and have submitted quarterly
payments to Picture Perfect according to the terms of their contracts. We also
know that some foreign agencies are withholding the fees collected because
Robert Tod owes them much more for sales he has made on other projects than they
owe Picture Perfect and Todtri.
Based on certain information we have obtained relative to early sales in the
U.S. we estimate that gross sales from the Picture Perfect 12 catalog through
the end of 1998 was between $700,000 and $1,000,000. Based on industry averages
we estimate that sales outside the U.S. should have been about equal to, or
slightly greater, than U.S. sales.
This means that the average gross sale per catalog image in the first twelve
months was between $333 and $476. The average photographer share of these sales
would probably have been between $80 and $114 per image.
In response to my on-line article published in January, Tod said, "So far as
Todtri is concerned, the company has been around for 10 years, is a
multi-million dollar a year business and purchases approximately $500,000 of
photo rights per year. In 1997, there was a downswing in the publishing
industry and Todtri coincidentally suffered a number of calamities that took
place at the same time--late deliveries, high returns, slow payments from
principal customers, bad debts of more than $600,000. This was communicated to
our vendors and with many of them we did our best to reduce our liability by
entering in payment plans."
I have been unable to locate any stock agency or photographer who was offered a
payment restructuring prior to the January 1999.
In January some claimants began receiving an offer to settle claims for monies
owed through November 30, 1998. Tod had made arrangements for financing through
Capstone & Company, 515 Madison Avenue, 21st Floor, New York, NY 10022. Mr.
Joseph Ingrassia is the investment partner handling the arrangements. The
explanation they are providing to trade creditors is as follows:
"Todtri Productions, Ltd. ("Todtri") has been, and still is engaged in the book
publishing business on an international scale. In 1997, because of the difficult
environment affecting the industry, a major account went bankrupt and several
others were so adversely affected that their payments became extremely overdue.
In addition, Todtri's largest account changed the manner in which they did
business and is no longer a customer. In 1998, the international monetary crisis
further negatively impacted on Todtri's finances. While Todtri has continued in
business and has replaced the accounts, the process was painful and prolonged.
As a result, Todtri has incurred diverse debts that is unable to either pay in
full or in all cash.
"Because Todtri's basic ongoing business is sound, it has received a commitment
for a significant new financing which will enable Todtri to begin paying back
debts and to continue in business stronger than ever. The lender has required,
however, as a condition of making the financing, that Todtri's existing debts be
restructured in an Agreement of Composition with its trade creditors.
"Todtri has engaged Capstone & Company, LLC to organize that Agreement of
Composition. The purpose of this letter is to describe the terms and conditions
under which your trade payable due from Todtri will be paid. We ask that you
return this document in the enclosed self-addressed stamped envelope. We are
seeing to close the financing for Todtri at the end of January, 1999, provided
the requisite number of trade creditors join in the Agreement of Composition. It
is anticipated that the first payment would be made in February, 1999. To
accomplish this, we need your cooperation in sending back your signed document
as soon as possible, but no later than January 15, 1999."
In this agreement Todtri offered to pay creditors 100% of what is owed, but
payment periods are stretched out over many months and vary from creditor to
Agencies that had licensed rights to Todtri for the use of images in Todtri
books are being paid off in six months. Stock agencies that supplied images for
catalog 12 (90% to 95% of the total images in the catalog) are being paid off
over a period of two years.
Tod says, "The lender has required us to enter into Agreements of Composition
and Forbearance Agreements with our principal vendors according to different
classes. Our vendors who are owed in excess of $50,000 and that in totality
represents 94% of our indebtedness, have now all entered into these Agreements
as a result of my trip to the Far East (in January) where most of them are
located. Each vendor has been placed in a particular class according to the
dollar amount owed. All vendors within each class get treated the same way.
ALL vendors get repaid 100% of what is owed, most over a period of time, those
less than $1,000 in one shot."
Tod said in a January 25th letter, "...individual contributors are about to be
sent sales reports along with full payment as soon as our refinancing is in
He also said, "It is our understanding that all vendors have been sent either
an Agreement of Composition or a letter advising them of our re-financing and
our intended payments to them. If there are any vendors who have not received
the above, then I request that they fax or write to me personally so I can
ensure immediate action takes place."
The offer from Capstone included a stipulated amount that was owed the creditor
as of November 30, 1998. In order to share in the payment plan the creditor was
required to stipulate that the amount was "payment in full" and give up their
right to audit the books.
Some creditors were reluctant to give up their right to audit because they feel
that the numbers offered were extremely low and probably do not represent the
totals collected during the period. If they truly do represent the totals
collected then the publishing program has been an extremely inefficient one.
The creditors in the Far East are for the most part color separators and
printing companies that produce both Todtri books and Picture Perfect catalogs.
It is assumed that their schedule of payments is less than six months since
without them Todtri can not continue to publish product.
We estimate that the debt to agencies and photographers is in excess of
$300,000. If this is only 6% of the total debt as Tod indicates, the total debt
must be in the range of $5 million.
It is clear that Todtri has used the photographer share of monies collected in
the past year to pay off operating expenses. Now, they are proposing to stretch
out payments to photographers so they can pay other trade creditors in a more
Picture Perfect appears to recognize no obligation to the photographer's share
of monies collected in trust until they are paid out to the photographer. In
normal agency practices there is no obligation to pay the photographers until
the agency has actually been paid by a client. Therefore, Picture Perfect's
argument they make that some of their book publishing clients didn't pay their
bills should have no relation whatsoever to the photographers being paid.
Most stock agencies put receipts from licensing in an account separate from
their general operating account, and never allow the photographer's account to
fall below the total outstanding to the photographers. This is the way a stock
agent should operate. Obviously, Todtri does not operate that way.
The situation at Picture Perfect has given us a chance to explore the current
economics of catalog marketing, for the sellers, catalog producers and
photographers. The following numbers are hypothetical, but based on interviews
with a number of people involved. We believe these numbers are realistic and
probably close to the actual earnings in this situation.
For purposes of this analysis we assume that sales break down 50% U.S. and 50%
foreign, although it is possible that the foreign share may have been somewhat
According to Robert Tod 90% to 95% of the images in the PP12 were provided by
other agents and we will base
our calculations on 90%.
|Selling Agent Share (40%)
|Catalog Producer (40%)
Selling Agent in U.S.
Selling Agent in U.S.
|Amount Left For Split
|Image Supplying Agent Share
|Photog Share From ISA
|Photog Share - Direct
Above is how the income should have been divided had everyone been paid
according to contract. Now, lets look at the probable costs of each participant
in this marketing venture.
Foreign Selling Agents - Foreign agents purchased and distributed between
40,000 and 70,000 books from Tod. We believe they paid about $3.00 for each book
received which would make the total paid to Tod in early 1998 somewhere between
$120,000 and $210,000. It appears that some dupes were included in this $3.00
price. Some agencies would have wanted extra 6x9cm dupes which may have cost
$2.00 each to produce, given the volume.
On top of this, agencies had postage costs to distribute the books. It would
probably have cost at least $3.00 per book to ship these books. In some
countries shipping heavy print catalogs is even more expensive so we think $3.00
per book is a minimum for distribution costs.
Thus with purchasing the books and mailing, the agencies had a combined
estimated outlay in early 1998 of somewhere between $240,000 and $420,000. As we
can see from our chart above their 40% share for this catalog was at best
$200,000. This does not include any of their staff and overhead costs in
actually making the sales.
Image Supplying Agents - We know that 90% to 95% of the images in the
catalog were supplied by other agents. These agents will receive 60% of what
Picture Perfect receives from each sale and split that with their photographers.
If Picture Perfect makes the sale in the U.S. the ISA gets 60% of the gross fee
paid. If the sale was made by a foreign country the ISA get 36% of the gross
fee. The income that should have been paid to these ISA's would have been
between $302,000 and $432,000.
As of 1 January 1999 they had received no payments. If and when these agents
get paid they will keep half the income, or between $151,000 and $216,000, and
remit the rest to the various photographers who produced the images.
The agent had costs of collecting the images from the photographers and
editing. In some cases the agent may also have been required to pay something up
front to Picture Perfect to help offset the initial production costs of the
catalog. In this case the ISA's have also had legal expenses to try to enforce
their contracts and collect the funds owed them by Picture Perfect. In addition
the credibility of the ISA's with their photographers has been severely damaged
as a result of the actions taken by Picture Perfect.
Photographers - In many cases the photographers are required to pay $100
to $150 per image to help offset the costs of producing the catalog. This amount
is due to the agency or catalog producer out of the first dollars owed to the
photographer. This would be somewhere between $200,000 and $300,000. Depending
on the number of different images licensed photographers might not be owed much
for 1998 sales. Of course, some photographers will do much better than the
averages and others will earn little or nothing.
Picture Perfect - We estimate that printing, design and separations cost
them something in the range of $300,000; that postage, mailing lists, and
mailing house fulfillment cost were at least another $45,000 and that the
production of large format dupes added another $100,000 in costs for a total of
$445,000. This is minimum cost of catalog production and distribution.
Picture Perfect might have received between $210,000 and $300,000 from the
foreign selling agents and they would have been entitled to keep up to $120,000
or that. Their selling agent share of U.S. sales might have been as high as
$200,000 but without knowing specifically which images sold, it is impossible to
make a closer estimate of what they actually received. In addition, it is
believed that some of the Image Supplying Agents made some up front payments to
help offset the production of the catalog.
Given the cost that Selling Agents, Image Supplying Agents and Photographers
are likely to have had -- even if Picture Perfect paid what they owed -- nobody
would be doing very well after the first twelve months of sales.
Given the number of catalogs currently being produced, many in the industry
believe the average useful life of current print catalogs is not much more than
18 months. If that is the case it will be hard for anyone involved in this
project to end up making money.
Granted, a few of the major catalog producers are getting much better returns
per image than this, but they accomplish their market penetration through
overwhelming presence and huge expenses in supplementary advertising. The fact
remains that there are too many pictures chasing too few buyers.
If these statistics are at all representative, those who are not market leaders
and who want to compete are going to have to find a more cost effective way to
show their images to clients.
Story 200NATIONAL GEOGRAPHIC GRABS MORE RIGHTS
Assignment Shooters Lose
February 9, 1999 - Photographers working for National Geographic are facing
another cut in their annual income. This one comes, not in the amount of the day
rate, but in the additional rights Geographic is appropriating for the single
According to the New York Times, Terrence B. Adamson, NGS Senior Vice
President, Law, Business and Governmental Affairs, justifies this by saying that
the trend among many media groups is to buy all rights with one fee.
As best we can determine the basic day rate at National Geographic is about
$400. For an additional $35 per day, which the photographer has no choice but to
accept, Geographic gets a whole bundle of secondary uses. This list has been
greatly expanded under the new guidelines presented to photographers at the
annual photographers meeting on January 14th and 15th.
These uses now include: NGS books (including picture books, trip planners,
guide books, travel guides, diving guides, field guides, etc.) maps, atlases,
globes, CD-ROM's, complete re-issue of NGM in digital format on CD-ROM's or
on-line, calendars, greeting cards, posters as well as commercial merchandise
like tee shirts, hats, and umbrellas, national ads, promotional cards,
brochures, catalogs, NGS web site, computer screen savers, domestic and foreign
NGS TV shows and videos and other magazines like Traveler, World, and the new
NGS magazine: Adventure, "kids stuff", slide shows, games, painting kits,
puzzles, art boxes, indexes, note cards, prints, matted prints and any other NGS
use that might be devised in the future.
A decade ago additional fees were paid for such uses with the fee varying based
on the use. NG has slowly been chipping away at that practice. As the rights
diminish, the day rate has stayed basically the same over several years.
We understand that some stars are able to negotiate fees higher than the $400 a
day, but that seems to be rare. More common are the photographers who are paid
less than the normal day rates for travel days, editing days and administrative
days. A photographer who gets a 30 day assignment from National Geographic
Magazine puts in a lot more than 30 days effort for the fee he or she receives.
One of the areas where there will be the biggest loss of income for those
photographers who shoot for National Geographic Magazine (yellow borders) will
be in resales to foreign publications of the articles they produce. Currently NG
has five foreign editions but they want to increase that number to 11 in 1999.
There is a payment for re-use in these editions and it has been $125 per full
page picture used or 25% of the $500 page rate of the domestic edition. This
page rate has not changed in six years and is very low when compared to other
publications. Photographers believe that a rate of $900 per page would be closer
to "market rates" based on the fees charged by Time-Life Picture Collection, NGS
Image Collection and those recommended in FotoQuote. NG has proposed to maintain
the $500 page rate and lower the percentage for foreign editions to 20%, 15% and
10% depending on the country and the size of the distribution.
This hurts the photographers in several ways. Not only are re-use fees low, but
in the past the only way many photographers could justify doing NGM assignments
for the low rates offered to sell re-use rights to foreign publications. These
re-use sales could often bring in an additional $30,000 to $50,000 for a 20 page
story with 12 pages of pictures, which, when considering the time and energy
necessary to get 12 pages of pictures into the magazine, resulted in a
reasonable return on investment.
Now that NG is publishing their own magazines in all these foreign countries
the chance for photographers to make additional sales of the prime story are
basically eliminated. That would be fine if the photographer were adequately
compensated for the original U.S. use plus the increased distribution, but of
course that is not the case.
Some photographers have calculated that the foreign rights to a story with 12
pages of pictures would net them approximately $9,000 under the new NG agreement
instead of the $30,000 to $50,000 they could have received by licensing uses of
that story directly in other magazines as has been their right in the past.
Another problem that many photographers are facing is shorter assignments and
fewer assignment days per year from NG. This can be a mixed blessing. Short
assignments, with some flexibility in when they have to be shot, can be
performed without any negative effect on the photographer's other business. In
the old days when a photographer was away on an NG assignment for several months
he often found it very difficult to get new work from previous clients when he
returned. In the interim, his previous clients had found more reliable
photographers to handle their work.
On the other hand, the unpaid work of coming up with a workable story idea and
selling that idea to the story committee is often the same for a short story as
a long one. In addition there may be a lot more time spent in editorial meetings
and editing, if you are working on a series of short stories rather than one
In the end, photographers are trying to sustain their businesses on fewer paid
days a year and a reduced income from stock sales.
Another NG policy that has been in place for a while, and further embitters the
photographers, is the policy that NG retains all rights to published images --
and "file selects." Most NG photographers don't have a problem with the
published images, but "file selects" are another issue. The magazine can easily
lock up every good frame from a given shoot. Kent Kobersteen, Director of
Photography, says the number will average around 100, but the photographer has
no way judging, before or during the shoot, how much of the production he will
eventually be able to license elsewhere.
This also tends to lock the photographers into working with the in-house stock
agency because the only chance they have of licensing rights to these "file
selects" outside the NG family is through the NG in-house stock agency.
In addition, the new policy forbids photographers access to their published
originals, forever. Photographers believe that because they share copyright to
these images, they should have the right to physically access them for their own
purposes. It is interesting how NG can deny the photographers physical access to
their property and then still argue for tax purposes that the photographers are
Finally, there is the issue of re-use in books. Under the new policy the only
time a photographer might be paid an additional fee for use in one of the 60+
books NG publishes each year is if over 90% of the images in the book are the
photographers. It is so unlikely that a photographer would have this percentage
of images in a single book that is hardly worth discussing except that even then
there is no guarantee that the photographer will get additional compensation. At
the 90% level Geographic has agreed to negotiate the issue with the
The happiest photographers seem to be those working for the lesser magazines --
Traveler, World, and presumably the new Adventure magazine -- rather than
National Geographic Magazine. They can work on short narrowly defined projects,
NG keeps fewer of their images so they can make more off the stock produced, and
they have no illusions about NG being a significant part of their income.
When NG assignments were longer that freelancers could basically work full time
for NG and make a living. There were gaps between assignments, but the
photographers got enough work in a year to sustain themselves. Now, with shorter
assignments, reduced re-sales, many are questioning whether they can continue to
accept assignments from National Geographic - particularly the long magazine
assignments. Many will continue to accept an occasional assignment, but they
are aggressively "re-inventing" themselves and looking to other outlets to make
More than 50 photographers have signed a letter to John M. Fahey, Jr.,
President and CEO of National Geographic Society, offering a counter proposal
that would improve the photographers situation slightly. Even if the
photographers get everything they are asking, NG will still be getting images on
some of the most favorable terms in the industry.
What's Likely To Happen?
The same that happened about three years ago. The Geographic management will
sit on the issue for a couple months, and the photographers will refuse to take
new assignments until the rights issue is settled. Then management will say,
"Our original offer stands, take it or leave it." If photographers don't accept
the assignments offered they will be given to someone else.
In the January 14th photographer's meeting one photographer clearly stated,
"The contract you propose does not allow us to survive." To that Terry Adamson
responded, "You are wrong....,and if some of you (meaning anyone in the
assembled group) are not happy, we can do without you!" Three years ago,
photographers grumbled when the "take it or leave it" ultimatum came, but they
took the work, and NG will expect the same to happen this time.
However, three years ago, many photographers started to aggressively build up
non-Geographic business. Expect to see many more of the photographers who have
been working for NG aggressively competiting for other work. They may still
take occasional Geographic jobs as they transition their business, but their
goal will be to move away from NG, not closer to them.
One photographer believes the problem is that National Geographic management
has a perception of their photographers as cavalier romantic types who prefer
traveling to exotic locations to getting paid. He says, "the reality is that
freelancing for this organization has no security, all the travel plays hell
with family relationships, and at the end of the day we have no retirement
benefits and little ability (especially with the new contract) to benefit from
the images we took when we were young and fit."
There is no question that photographers shooting for National Geographic like
doing editorial assignments. But they pay a heavy price for the privilege -- and
that price may finally be getting to be too great.
Things For Photographer To Think About