Random Thoughts 113

Posted on 11/28/2005 by Jim Pickerell | Printable Version | Comments (0)



November 28, 2005

Getty Offers Discounts In Asia

In an effort to increase volume Getty is offering a 20% discount in the Asia/Pacific region on all RM and RF images, "including Stone, Photodisc, Digital Vision and all our other collections" through the rest of the year.

In a promotional e-mail to customers that supplied a special discount code the following countries where the offer would be in force were named: Australia, New Zealand, Hong Kong, Singapore, Malaysia, Philippines, Thailand and Indonesia. It is not clear whether Japan, Mainland China and Korea are included in the discount offer.

The conditions are: "Discount applies only to one transaction completed between November 17 and December 31, 2005 for purchases of royalty-free, rights-managed or archive still images, VCD's or royalty-free film. Discounts may not be applied to any subscription products. May not be combined with other offers, discounts or pricing arrangements."

Mauzy Joins Digital Railroad

Charles Mauzy has left Microsoft to take over as President of Digital Railroad. Mauzy will open Digital Railroad's Seattle office, where he will be responsible for growing the company's sales, marketing and operations. He brings extensive domain knowledge to the company from his background as a photographer, photo agent, entrepreneur, technologist and executive

At Microsoft, Mauzy was an executive in the Windows Media, Entertainment & Technology Convergence Group. His teams were responsible for managing select global strategic relationships with broadcast, cable, consumer electronics, wireless, telephony, media and photography industry partners who have business engagements that span all Microsoft business divisions. In addition, Mauzy founded the Rich Media Group within the Office of the CTO, where he was responsible for planning Microsoft's long-term digital imaging strategy and managing key photography industry alliances.

Mauzy began his career in imaging as a professional photographer and entered the photo agency business as the Director of Photography for Allstock in the late 1980s. He subsequently served as Director of Media Development for Corbis, where he supervised worldwide content acquisition and development activities, focusing on image and art collections held by professional photographers, agencies, museums, private and public archives, government organizations, corporations, and cultural institutions. Following Corbis, he served as Vice President of Business Development for EyeWire, where he was responsible for bringing together creative content with new digital technologies and developing new business opportunities for creative professionals. Prior to joining Microsoft, he served as CEO of Altamira, focusing on developing advanced technology solutions for digital imaging applications which was sold to LizardTech, Inc. in 2001.

Stock Asylum Discusses Future of Stock Industry

Ron Rovtar of The Stock Asylum has recently done a three part series on the future of the stock photography industry that is well worth examining.

The articles can be found at the following URL:

In general I am in agreement with Rovtar, although overall he is a little more upbeat and positive about the industry than I am. He discusses the shift in the industry and says, "we must shed some of our preconceptions as the current trend 'bends' (or changes again) in this flurry of acquisitions."

One important point Rovtar makes in relation to royalty-free is that, "Recent technological advances have turned a spotlight on copyright infringement in stock photography. The financial loss is staggering. And unlike the rights-managed segment, royalty-free offers no option for gaining control of the problem. At some point stock sellers will have to respond to this problem and that may mean reducing their commitment to royalty-free."

I agree that there is a major problem here that so far is not being addressed. I agree that the problem is very difficult to address. But while the amount of use is not a factor with RF, if users have never purchased any rights to a particular RF image that can be tracked. In the RM environment it appears that about half the unauthorized uses are uses beyond the original license, while the other half are uses of images that have never been licensed by the customer. This last type of unauthorized online use can be tracked with RF in the same way that unauthorized RM use can be tracked. This doesn't solve the problem of unauthorized print use, but it will be of some help.

However, I don't see any likelihood that stock sellers will "reduce their commitment to royalty-free."

Rovtar also points to the buyer's risk when choosing a RF image that their competitor may also choose to use. This is a mantra that has been repeated by RM photographers for years, but I think the evidence shows that in the vast majority of cases buyers don't really care who else uses the image so long as it meets their specific needs. Those that have any concern at all are already purchasing RM for such uses and their numbers are so small that they represent an insignificant part of total revenue.

Another interesting point Rovtar makes about RF is that, "Once an image is sold as royalty-free, it can never be ethically sold as rights-managed." He's right on one point that it probably cannot be sold for a high ticket advertising fee, but their have been a few exceptions. In a few cases customers have been willing to pay a multi-thousands of dollars for a RF image that had (1) never been licensed to any of their direct competitors (something the sellers can show), and (2) would be taken out of the market for all future sales.

The other way that RF can continue to eat into the RM market is through discounting to certain customers or market segments. While this is not technically licensing the image as RM it should be remembered that a huge percentage of current RM licenses are for fees BELOW the average price of RF. These images usually go to customers who buy volume and who can't afford to pay current RF prices. RF sellers can probably find ways to discount their prices to certain markets without lowering their overall price for usage, and this will probably continue to eat into RM sales.

Rovtar makes the point that, "returns from a mass-produced product are always less that the returns from crafted products." While RM producers would like that to be true I'm not sure it ALWAYS is, particularly when the seller of the product has no cost of production to offset, as is the case in our industry. When the seller is only paying a royalty percentage of what he receives he can continue to sell a product below cost so long as someone will produce it and deliver it to him.

Unfortunately, "hope springs eternal" in the hearts of many industry producers and they continue to produce images long after a rational businessman would have given up the business or moved to something else.

It was interesting to note in the Alamy statistics supplied in August (Story 747) that the average price for an RF image licensed to a credit card customer was $240; to an account customer was $212 and the average price of an RM image for editorial use was $135.58. Does that mean that the RM image was cheaper to produce? I don't think so. Rather, thats all the editorial customer would pay and a huge percentage of Alamy's total revenue came from editorial sales.

Before you jump on Alamy for selling images to editorial users for too little money recognize that all the other major sellers are doing exactly the same thing. They just don't report the breakdown of their figures in this way. But if you have any doubt look at all those low royalty payments on your sales reports and figure out what the gross fee would have been.

The above are a few of the points where I take issue with Mr. Rovtar, but as I pointed out in the beginning, on balance I believe his is an excellent analysis that is well worth reading.

Image Source Offers Mid-Size Thumbnails

In Story 774 I indicated that on Jupiter's new site there was a "unique feature" that pops up a mid-sized version of any thumbnail whenever the cursor is moved over the thumbnail. In fact, this feature isn't unique.

Image Source was actually the first to launch zooming thumbnails in July of this year, albeit only a few months prior to Jupiter instituting the technique.

Copyright © 2005 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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