Use Pricing Could Benefit Microstock

Posted on 3/11/2010 by Jim Pickerell | Printable Version | Comments (1)

What an image is worth to a customer depends entirely on the customer’s intended use. The size of the file delivered has very little to do with how an image might be used, or the value the customer will receive from using it. Granted, there are limits as to how a very small file can be used. But, there are many ways that a medium-size file can be used, with widely varying values. The biggest problem with royalty-free licensing, and particularly with microstock, is not that it prices certain uses very low, but that the system of pricing by file size has tried to ignore use in an effort to achieve simplicity.

But is microstock pricing really simple?  It places limits on certain larger uses. Here are a few of the iStockphoto limitations. Uses in online print-on-demand products and in logos or trademarks are prohibited entirely. The company charges what it calls an “extended license” fee for:

  • More than 499,999 impressions in any printed product such as magazines, newspapers, brochures, catalogues, greeting cards, postcards and posters.
  • Items for resale, including prints, posters, calendars, mugs, mouse pads, t-shirts, games, etc.
  • Electronic templates for resale on Web sites, brochures, business cards, e-greeting cards, etc.
  • More than 499,999 DVDs.

The rules at every microstock site are different, and it is sometimes necessary to negotiate the fees for such uses. The real distinction between royalty-free and rights-managed licensing is that the former generally uses fewer variables than the latter to establish a price. But in the royalty-free pricing environment, the number of variables keeps growing, while rights-managed sellers keep trying to find ways to simplify their pricing structure.

What’s needed?

What is needed to grow revenue in the microstock environment is not to simply raise prices, but to begin to expand the list of items that fall into the “extended license” category. When a customer begins to price a use, the first step should be to determine whether an extended license is needed.

For example, microstock sellers should initially add billboards, magazine covers and book covers to the extended license list. This change would apply to very few uses, but it would be easy for customers to understand why they should pay more for such uses than someone who planned to use the image in a small, locally distributed brochure delivered to a niche market.

In addition to large outdoor billboards, that category should be defined as any type of electronic or print point-of-purchase banner or mural, kiosk, transit or bus shelter presentation, airline or transit poster, or visual presentation on the side of a bus or truck. Eventually, these uses should be segmented in terms of number of locations. If the image was only on one billboard, one point-of-purchase banner or poster in one store it should be less expensive than if it were to be used in a chain of 50 or 500 stores.

With magazine and book covers, the segmentation should be in terms of number of copies printed—not just under or over 500,000. On the other hand, it should not necessary have as many breakdowns as are typically found in a rights-managed pricing schedule.

A steady expansion of the extended license rules should be easier to justify and explain to customers that across-the-board price increases. It would raise some revenue and help microstock sites determine how big a segment of their total market such uses represent. The next segments might be wall décor and print advertising, always moving from what is believed to be the smallest segment of the market to what is believed to be the next largest segment.

In this process, microstock distributors would accomplish several things:

  • Raise revenue without raising prices;
  • Lower risk of upsetting small users and driving them somewhere else;
  • Learn more about how customers are using images and the number of customers in each usage segment; and
  • Improve supplier relationship by making an attempt to raise revenue.

Thus, to move from current strategies to one focused on use is not really that big a leap. Such a strategy seems more practical than trying to assign a quality level to each image and pricing based on this quality level. All that does is prevent certain customers from using certain images.

Microstock photographers who want to see their revenues increase should encourage microstock distributors to adopt these strategies as they would benefit both photographers and distributors.

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, 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:  


  • Ellen Boughn Posted Mar 11, 2010
    Here's the problem(s) with this idea. PicScout claims that 85% of the image usage online comes from unauthorized uses. Even in the traditional RM business, buyers under reported uses and these were primarily print uses that were easily identified if in larger publications.

    A photographer client of mine recently sent me a billboard with the image of one of his models on a billboard advertising a medical procedure. It was a sensitive issues useage. But he can't stop it as it is virtually impossible to track down the buyer from a microstock site unless the photographer is exclusive with the microstock.

    Given that many people simply don't tell the truth when what they feel is a white lie saves them money and that catching them in the lie is problematic...I don't think this will work very well with million of photographers, zillions of images and uses based in hundreds of countries. And once they are found, who is going to go to court over a $50 shot?

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