Has Microstock Reached Plateau?

Posted on 1/7/2010 by Jim Pickerell | Printable Version | Comments (0)

For most of iStockphoto’s best-selling photographers, the number of images downloaded per month declined in 2009.

Using the figures from iStockcharts, we tracked monthly sales of 198 the top 250 photographers. This group represents about a quarter of 1% of iStock’s more than 80,000 contributors. Download numbers reported by iStockcharts are exactly the same as the numbers reported on iStock itself for each contributor, but information for approximately 50 of the top 250 is not made available publicly through iStockcharts.

Only 511,232 of the 6,078,000 images in iStock’s collection, or about 8%, belong to these individuals. In May 2009, Selling Stock reported that units downloaded in April were down compared to March for 117 of the people for whom March comparative data was available. Following these same top shooters on a monthly basis throughout the year demonstrates a flat to declining trend for most.

This chart compares the average downloads for May through December 2009 with the March high for the same 117 top producers. This group had a combined total of 414,453 downloads in March and averaged between 315,935 and 402,560 downloads per month for the eight months from May 1 through December 31. Exact figures for May through December are not available, because iStock changed its reporting policy in June.

Currently, the company lists sales that are in a range greater than a particular number, rather than providing a specific number licensed as they did before. The actual number of downloads varies by as much as 10,000. For example, >100,000 could be anything from 100,001 to 110,000. If the photographer’s total downloads are less than 100,000, the range is 1,000 downloads. Our estimates were calculated by determining the minimum and maximum number of downloads each photographer could have had; actual numbers will fall somewhere in between.

According to a best-case estimate, these photographers as a group saw a 3% overall decline in units licensed, compared to March. The decline could have been as much as 24% if, in each case, the photographer just passed the low number. The actual decline for these photographers was likely in the range of 10% to 15%.

Average sales of 61, or 52% of the 117 photographers, did not exceed March sales. Another 35% were in a range with lowest possible sales less than in March, but the highest possible sales greater than March. Only 13% had average sales in the last eight months of the year that definitely exceeded March sales.

Are these groups representative?

Total downloads for the group of 198, extrapolated from eight months to a full year, were between 5,014,715 and 6,175,716. In 2008, iStock downloads are estimated in the range of 25 million. If that number remained flat for 2009, then this small group of contributors represent about 22% of total sales. If iStock had, for example, a 20% increase in sales in 2009, total downloads would fall somewhere around 30 million, and the images of these contributors represent 18% of sales. However, given the overall decreases in sales these individuals experienced it seems unlikely that sales grew that much—or at all.

Return per image

Nearly half (47%) of iStockphoto’s top producers have fewer than 2,000 images in the collection, and 48 have less than 1,000. Many believe that it is necessary to have thousands of image in microstock in order to earn any money. Based on the results of this group, that simply is not true.

On the other hand, based on royalty reports to several individuals earlier in 2009, it appeared that the average license fee per still image downloaded was about $6.50. Given that iStock has said their 2009 revenue would exceed $200 million, a $6.50 average license fee would indicate about 30 million downloads. 

There are two other possible explanations for revenue growth without an increase in the number of downloads. There were price increases, and the people I have talked to about royalties do not have images in the Vetta collection, which would net them much more per image licensed. Many of 198 people should have a significant number of images in Vetta. In addition, video and audio sales could be growing significantly, and these sales are at higher price points. 

In June, we offered several other ideas on why still image sales have declined, including the economy, increased competition as image supply grows, competition from other microstock distributors and price increases causing customers to limit usage.

Copyright © 2010 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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