Separate Pricing Structures Needed for Print and Electronic Uses

Posted on 4/29/2010 by Jim Pickerell | Printable Version | Comments (1)

As methods of supplying educational information to students change and schools adopt more and more electronic tools and techniques, photographers not only need to revise their image production strategies, but also to examine the way they will charge for their services in the future.

Until now, the principal use of photos for education has been in books. But demand for books is declining, while demand for teaching resources that span various electronic formats is growing rapidly. Instead of asking for more books, schools now want “learning objects” that divide the information in traditional books into its core elements so that it can easily be sourced lesson by lesson. These short bits of information tend to deal with particular lessons or themes that might appear within a chapter of a printed book.

Not only will photographers be required to create imagery and tell stories in totally different ways from those in which they have become accustomed, but they may need to devise entirely new compensation strategies. Without such changes, many will no longer be able to afford to produce.

Rights granted by current usage licenses for textbooks are often confusing, even to the editors requesting the use. For example, a typical license might read, “length of term, 10 years from date of first sale,” and the usage is defined as, “estimated total print run 1,250,000 includes Electronic and Print Uses and Formats as defined below and excludes Web and Other Uses and Formats as defined below.” (Emphasis added.)

That below definitions include “Electronic, optical and magnetic media (such as CD-ROMs, DVDs and flash drives) and similar or successor technologies” and “Access to Publication through a Website (or similar successor technology). We will use reasonable security measures to limit unauthorized usage of the vendor’s photographic images reproduced in electronic form, which may include password-protected access. Edition may be accessed on [publisher’s] Websites or via customer-hosted servers. Web usage is limited by the length of term, and not by print run or number of users.” (Emphasis added.)

This can be interpreted to mean that during the next 10 years, there is no limit on the way an image under this license can be presented to customers in electronic formats other than CD-ROMs and DVDs, and there is no limit on the number of customers who can access it electronically. In addition, the use does not have to be tied to a particular printed book, but could be used as part of a “learning object” on the general subject dealt with in the book.

Thus, it seems likely that the image could be used in any electronic way, for any educational purpose whatsoever, for 10 years from the date of first use. In some cases, publishers are now asking for 20 years. Considering that the vast majority of educational uses 10 years from now will be electronic, it is highly unlikely that any image licensed now for educational use will ever be licensed again.

Why do publishers need such long usage terms?

Publishers argue that they need long usage terms in order to maintain the integrity of the entire book package, because often some of the authorized copies (particularly when the numbers are over a million) will be printed seven or eight years into the license, stored in warehouses for some time and used by school systems for many years. The schools need to have the clear right to use the book as long as they want. While that may be true for printed books, it does not seem relevant to electronic uses.

An alternative

Image suppliers need totally separate licensing strategies for print and electronic uses. The license terms currently in common use should apply to printed books only. All electronic used should be handled in a different manner. Electronic learning objects will be updated more frequently, and each new update should be considered a new product.

Image sellers must also recognize that, with both print and electronic uses, it is virtually impossible to control the number of times the product will be used once it is delivered. Print books may be passed to new students year after year until they fall apart. Electronic uses, even on password-protected sites, are very difficult to control. Therefore, image sellers should stop worrying about how the product is used after it is first licensed and concentrate on receiving sufficient compensation each time a publisher licenses rights to someone.

Thus, when licensing for a 1,250,000 print run for 10 years, the publisher may continue to deliver books to paying customers until the 10-year term is up or the publisher has sold more that 1,250,000 copies, whichever comes first. If near the end of the term, the publisher prints a lot of extra copies and stores these in a warehouse, and they remain unsold when the 10-year term ends, the publisher must either license additional rights or destroy the unsold books.

The terms of use for electronic products or “learning objects” should be for much shorter periods—one or two years. These will be updated more frequently. A certain few products may be used for years, but the vast majority will have shorter useful lives as they become outdated by new information. The publisher should be allowed to license rights to as many users as desired during the term of the license, and those customers should have the right to continue to use the file they purchased for as long as they want. However, if customers want a newly updated version, they must pay a new fee.

In the rare cases where an electronic object does not need changes or updating and has a long useful life, the publisher should continue to pay a regular fee—annually or every two years—for as long as he continues to sell the product. The amount of this renewal fee can be negotiated at the time of the initial purchase, so all that is required of the publisher is to forward the payment. No new contractual agreement is necessary. It will be the duty of the seller to provide the publisher with updated address changes.

The practice of trying to roll both electronic and print uses into a single license should be discontinued because the uses are so different.


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.  

Comments

  • Mark Turner Posted Apr 29, 2010
    This makes a great deal of sense, but how do we as individual photographers get the big textbook publishers to go along? And how do we figure out what an appropriate license fee is for the electronic uses when the publishers themselves are more than a bit vague about their actual plans?

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