Is Microstock Diluting RF and RM Revenue?

Posted on 7/26/2007 by Jim Pickerell | Printable Version | Comments (1)

There is no good way to estimate how many RF or RM sales are being lost because the customers are buying microstock instead. There are indications that Getty's RF sales in 2006 were declining about 10,000 units a quarter or 40,000 for the year. However, this is hard to confirm because Getty acquired Stockbyte last year and that acquisition should have boosted the total number of RF units sold. If 40,000 units were lost at an average price of $250, that would be $10 million.

Of course, Getty might not be the only company losing RF sales as a result of people buying images from iStockphoto; it might be much worse. Also there are indications that iStock only represents about one-quarter to at most one-third of total microstock sales, so one has to consider the impact sales by all the other microstock companies might have on the market.

It is interesting that 40,000 sales only represent about four-tenths of 1% of iStock's total sales for the year. Thus, more than 99% of the iStock customers could be new to the industry. And this is probably true for all microstock suppliers. These customers have probably never purchased an image from one of the traditional sellers and never will -traditional prices are too expensive for them. However, it is clear from these figures that less than 1% of iStock's downloads could have a major impact on traditional sales. Consider what happens if 2% or 3% of all microstock downloads were made by customers who would formerly have purchased their images from traditional sources. If it ever gets to 5%, at current microstock prices, traditional RF will no longer exist.

It is also important to recognize that the microstock agencies are correct when they say the vast majority of their customers are new to the market and have never purchased an image from a traditional source. Virtually all the microstock sales have no impact on the traditional market. The trick is to figure out how to keep those traditional buyers who are consuming four-tenths of 1% of the total microstock images licensed from getting their images at microstock prices.

Also, as of the beginning of 2007, Getty stopped supplying the average price per image licensed in its quarterly report to investors. Thus, in future, it will be impossible to calculate the number of images licensed by Getty in a given quarter and will be even harder to determine trends.

Copyright © 2007 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:  


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