Adapting to Changing Business Models

Should a photographer license his work as royalty-free (RF) for a 20% royalty or rights-managed (RM) for a 40% to 50% royalty? The answer seems simple, but maybe not. In a previous article I pointed out that there is absolutely no justification for a distributor paying only a royalty of only 20% when an images is licensed as RF and 40% when it is licensed as RM. It doesn't cost the distributor any more to license an image as RF than as RM. In fact, if anything, because negotiating time is involved in making some RM sales it may actually cost the distributor more to license rights to an RM image than to an RF one. Thus, if we were basing the royalty share solely on the relative contributions of the distributor and the creator to the sale, the RF royalty should be higher, not lower, than the royalty for RM.