Rights Simplified Pricing: Alternative To RM

Posted on 7/14/2016 by Jim Pickerell | Printable Version | Comments (0)

To deal with increased customer demand for simpler, easier to understand pricing, and the general decline in the use of Rights Managed images industry wide, plainpicture in Germany has introduced a new pricing model they call (RS) plainpicture Rights Simplified.

RS gives the customer much of the rights simplification associated with Royalty Free. Unlimited media rights are authorized with only two limitations – duration and territory of choice. The user always gets the biggest file size available. Fees are kept in a competitive price range making them attractive to customers who have used traditional RF. In addition RS licenses offer the following options:
  • Upgrades to unlimited seats, unlimited print, corporate or retail licenses are redundant.
  • Exclusivity is available upon demand.
  • Rights in perpetuity are also available.
When it comes to tracking industry and territory uses, the plainpicture RS images remain under a "rights managed" umbrella.

At the same time customers may also license uses for single low print runs using standard RM parameters. Editorial and educational customers, as well as advertising/corporate users with small scale projects, have the option of license according to traditional RM rates.?

Segmenting The Collection

There are three different level of RS pricing. Images are placed into the various price groups based on plainpicture’s judgment of likely usability, likely customer demand and how exchangeable the image might be with other images in their collection, or other collections.

Key shots of a production go into Group 3, while supplementary shots go into group 2. This enables customers to use more images from one production, but keeps the key shots at a higher value.

Rights Simplified      
  Duration National International
Group 1 1 year $445 $655
  3 years $625 $895
  5 years $785 $1,125
  Unlimited $995 $1,450
Group 2 1 year $555 $785
  3 years $725 $1,085
  5 years $850 $1,265
  Unlimited $1,125 $1,685
Group 3 1 year $1,245 $1,975
  3 years $1,595 $2,445
  5 years $1,985 $2,965
Exclusivity Add On 3 months $1,000  
  6 months $1,500  
  1 year $3,000  
  3 years $6,000  
  5 years $10,000  
  Unlimited $16,000  

In the past, plainpicture has not been forced to dramatically discount on a large scale as is the case with many other distributors. Typical discounts are in the 10-20% range for RF when customers purchase volume. Nevertheless, users are becoming increasingly aware that prices for the same image can vary greatly depending on which distributor they use.

Currently 45% of the images in the collection are in Group 1, 40% in Group 2 and 15% in Group 3. They anticipate leaving the split at the current balance, but will make adjustments based on the new content available and market demand. Given that the majority of images are allocated to groups 1 and 2, a large number of the RS usage fees are in the $445 to $850 price range.

Currently plainpicture’s average price for all RM sales is about $255. The average price for advertising and commercial sales when editorial sales are not included is $344. Given these averages it seems clear that the needs of a significant number of customers are for smaller uses in terms of image size and circulation. They still find lower traditional RM rates more appropriate for their needs.

Thus, at this point almost no RS sales are for editorial uses. They make some RS sales to the book publishing sector of the market and the majority of RS sales are for corporate/advertising uses.
Advertising/corporate uses, fees generally start at $250 with a large portion being $251-$995, a few above $1,000 and very occasionally above $5,000. Currently about 65% of plainpicture’s sales are RM/RS licenses and 35% are RF.

I asked plainpicture’s Marcus Benkwitz if they had seen declining demand for RM images over the last few years? He said, “Yes, we have seen a clear decline for RM in the corporate/advertising sector, but not in the editorial sector. Customers are still interested in the type of imagery available as RM, but not in the pricing and licensing model.

“This has led to increased customized "Rights Package" sales for RM images over the past two years at price points between $3,500 to $5,000. Typical packages offer all below-the-line, all media, all direct marketing and all online.”

Copyright © 2016 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 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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