Eleven-Year Trends for RM and RF Sales

Posted on 10/13/2014 by Jim Pickerell | Printable Version | Comments (0)

Using numbers from Getty Images it is interesting to look back at the RM and RF unit sales and revenue trends over the last decade. Between 2003 and 2007 when Getty was a public company they provided investors with very precise gross revenue and average price per image figures. This made it possible to make a reasonable estimate of the number of images licensed in each category.

From 2003 through 2006 I also did a count near the end of each year of the number of images in the collection with each of four orientations (horizontal, vertical, square and panoramic). At that time Getty insisted that each image in the collection have an orientation as a keyword. Since then they have become a little lax on this rule. But now it is even easier to determine the number of images in a collection by type or brand by simply going to “Advanced Search,” clicking a collection type and doing a search with no keywords in the search box.  

In 2013 hard revenue numbers were not available, but it has been reliably reported that the gross combined revenue of RM and RF was down from $580.79 million in 2006 to about $300 million. Revenue has continued to decline in the first two quarters of 2014. (These figures do not include RF revenue from iStock or other microstock or subscription sales.)

Another factor to consider is that in 2006 about 55% of the collection was RM and 45% RF. Today, Getty’s collection has grown from 1,761,214 image to over 9 million at the end of 2013 and over 10 million today.

Based on an analysis I did of the 2013 sales of some of Getty’s major contributors I have concluded that the average price of an RM image licensed in 2013 was about $300 and the average price for an RF image was about $133.

Getty has told Flickr photographers and investors that the average price for RF licenses ranges from $175 to $225 and for RM $550 to $650. However these figures certainly do not include the huge number of RM and RF images that Getty licenses through Premium Access discount deals. Approximately 25% of the images Getty has been licensing are for prices of less than $25 and a significant additional percentage are licensed for prices between $25 and $75. The contributor’s royalty share is a percentage of these numbers.

In the charts below I have provided calculations using the mid points of the Getty numbers (RF, $200 and RM $600) to demonstrate how few images they are actually licensing if we rely on their claims.

Rights Gross RM Images in Avg. RPI Avg. Price Images
Managed Revenue Collection in Collection Per License Licensed
2003 $273,130,000 346,091 $789.19 $550 496,600
2004 $297,130,000 434,346 $684.09 $565 525,894
2005 $315,720,000 751,495 $420.12 $585 539,692
2006 $325,700,000 973,933 $334.42 $536 607,649
2007 $305,000,000        
2013 Est. Below          
50% RM $150,000,000 3,600,000 $41.67 $300 500,000
40% RM $120,000,000 3,600,000 $33.33 $300 400,000
Getty Claim $150,000,000 3,600,000   $600 250,000
Collection Today   4,310,235      
Royalty Gross RF Images in Avg. RPI Avg. Price Images
Free Revenue Collection in Collection Per License Licensed
2003 $161,310,000 189,523 $851.14 $195 827,231
2004 $204,530,000 252,161 $811.11 $210 973,952
2005 $238,760,000 404,016 $590.97 $236 1,011,695
2006 $255,090,000 787,281 $324.01 $242 1,054,091
2007 $255,550,000        
2013 Est. Below          
50% RF $150,000,000 5,400,000 $27.78 $133 1,127,820
60% RF $180,000,000 5,400,000 $33.33 $133 1,353,383
Getty Claim $150,000,000 5,400,000   $200 750,000
Collection Today   6,123,154      
RM + RF          
  Gross Images in Images    
  Revenue Collection Licensed    
2003 $434,440,000 535,614 1,323,831    
2004 $501,660,000 686,507 1,499,846    
2005 $554,480,000 1,155,511 1,551,387    
2006 $580,790,000 1,761,214 1,661,740    
2007 $560,550,000        
2013 Est. Below          
50% RM $300,000,000 9,000,000 1,627,820    
40% RM $300,000,000 9,000,000 1,753,383    
Getty Claim $300,000,000 9,000,000 1,000,000    
Collection Today   10,433,389      

Take Aways

1-    Gross revenue from Getty’s Creative Stills collection is about half what it was in 2006.

2-    The average price per image licensed has been dropping steadily since 2006. Now it is roughly 55% of what it was in 2006 for both RM and RF.

3-    Lowering the price has not significantly increased the number of units licensed. On the other hand, it was probably necessary to lower prices in order to hang onto customers.

4-    In February 2006 Getty acquired iStockphoto and gave the microstock model of licensing photography a significant boost in visibility and credibility. Getty’s RM and traditional RF sales peaked in that year and have continued to decline ever since.

Given the improvement in digital and Internet technology and the pressure from consumers for lower prices, it was probably inevitable that a shift from traditional licensing models to microstock and subscription would occur, but Getty’s participation may have caused a more rapid shift than otherwise might have been the case.

5-    Adding images to the collection did not significantly improve sales. In fact, by the end of 2013 there were over 5 times the number of images in the collection as in 2006, and yet in the best case there were probably only a few more images licensed in 2013 than in 2006.

I don’t have good evidence of what happened to unit sales between 2006 and 2013, but I believe they were probably down in 2008 and 2009, climbing a little in 2010 and relative flat since then.

6-    In 2003 a photographer could expect to license 4 uses in a year for every 3 images he had in the collection. Today, a photographer is lucky to license 1 use a year for every 5 images he has in the collection.

7-    The number of RM licensed in 2013 was less than the number in 2004 and probably less than the number licensed in 2003.

8-    The average annual revenue Getty received from each image in the collection dropped from $789.19 in 2003 to about $30 in 2013. This would mean that an image creator would need to have to have approximately 26 times (on average) the number of images in the collection in 2013 as he had in 2003 in order to generate the same gross revenue.

But, during this decade the creator’s cost of producing images certainly did not decline; the requirements placed on the creator to prepare images for acceptance increased; the creator’s royalty share (in the case of RM) declined and in general it became more difficult for individuals to get images accepted into the collection.

9-    There is no evidence that there is more demand for RM images. If the cost to use such images is greater than $100 the demand has significantly declined in the last decade. 

Copyright © 2014 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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