GumGum Ties Online Image Pricing to Traffic

Posted on 2/27/2008 by Julia Dudnik Stern | Printable Version | Comments (0)

Referring to the Apple-championed move away from digital rights-management technologies, image-licensing startup GumGum says it wants to be the iTunes of content, making the licensing process so easy it eliminates the need for content piracy.

More importantly, GumGum offers content creators a way of tying license price to use. Much like the traditional system that determines the price of a rights-managed image based upon a magazine's circulation or a book's print run, GumGum prices images based on a Web site's traffic.

The online ad-industry's concept of cost per thousand, or CPM, is the conceptual foundation of GumGum's licensing model. Image buyers choose from two licensing models: pay-per-use and ad-supported.

Under the pay-per-use license, the image producer sets the CPM. The buyer pays the licensing fee based on the total amount of page views. The ad-supported license offers image buyers free content with embedded advertising.

In both cases, GumGum hosts the images and handles the licensing, delivery, traffic monitoring, reporting and payment. The company earns revenue by charging buyers a handling fee, which is the same for each piece of content under either pay-per-use or ad-supported licenses.

The pay-per-use license is meeting with universal approval among professional photographers and other content creators. It allows monetizing their assets for as long as they are in use by the publisher.

However, it is not certain whether this license will click with buyers. While it would prevent rights-managed images from having to be taken down after license expiry, it may lead to higher costs than images available at flat rates. The adoption of the pay-per-use license by the buyer may depend on image suppliers' patronage of GumGum. While creative stills are available at extremely low costs, celebrity imagery stands to generate significant revenues in a pay-per-use scheme, provided comparable lower-cost shots are not available elsewhere.

Though the concept of online advertising served as part of an image remains relatively new, several companies are working on technologies similar GumGum's ad-supported image license. For example, AdBright has developed BrightPic, which offers a way to add interactivity and ads to online images. Closer to the stock-image industry, PicScout's PicApp sounds identical to GumGum's ad-supported license, though it remains in private beta after several months of testing.

GumGum is open to any photographer or agency, does not edit submissions and is currently open for business. Several thousand images are already online, including celebrity photography from X17 and Pacific Coast News, as well as individual collections by professional and amateur contributors. Currently limited to image licensing, GumGum plans to expand into video, audio and textual content.

In considering GumGum, stock producers may want to compare the service to other distribution platforms. While GumGum does not charge photographers a commission or take a percentage of each transaction, it also does not market its collection to buyers. It is the content owner's responsibility to market their GumGum content.

Copyright © 2008 Julia Dudnik Stern. 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


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