Death Of Rights Managed Licensing

Posted on 11/6/2019 by Jim Pickerell | Printable Version | Comments (2)

Getty is shutting down all Rights Managed licensing on www.gettyimages.com. This may effectively be an end to the entire marketing strategy of pricing stock images based on how they are used. While there are still a number of small and mid-sized agencies that continue to price images based on usage, it seems highly unlikely that they will be able to continue to build their image collections or attract many customers in the future.

Every stock photographer and stock agent should read this explanation of Getty’s plans for “phased retirement of rights-managed creative images.”

In March Getty Images personnel were telling some stock agency image suppliers that in 3 to 5 years there will be no more Rights Managed licensing.  Nine month later they have announced to contributors that they stopped accepting new RM images on November 6, 2019 and that all RM images will be removed from the site no later than January 2020.



In July we reported that Getty was moving rapidly to eliminate RM and had pushed 54 agencies with RM collections that they had represented, in most cases for many years, to either convert those images to RF or have them removed from the site. Only 4 of the 54 agreed to make such conversions.

In May of 2018 I analyzed the sales of few photographers who are Getty’s major, direct suppliers of both RM and RF images. I found that only 8.5% of their sales were for prices over $500 (gross sale). Indications are that the number of such sales has declined dramatically since then. However, these sales represented 78% of Getty’s gross Creative revenue. I believe Getty’s gross creative revenue is about $280 million annually. Based on my findings, if Getty doesn’t license any future images uses i for prices over $500 they stand to lose $220 million in annual sales. However, this previous estimate must have been way off given the relatively small sample of photographers I considered. Surely, the Getty staff has looked closely at the real numbers.



I have recently heard from second hand sources that Getty claims that only 10% of its gross revenue comes from the licensing of RM images. If that is 10% of the company’s gross revenue of $800 million that would be about $80 million and 78% of that would be $62 million. If it is 10% of just the Creative revenue that would be about $28 million and 78% of this is only $22 million.

While those high dollar sales are very infrequent they still represent a significant percent of gross revenue. I just heard of a single recent sale for $7,000. It doesn’t take many sales this size, or larger, to add up to some real money.

Getty says it has experienced a “steady accelerating decline” in the last five years in the licensing of RM image and that this decline is driven by “a reduction in the number of customers licensing RM due to the complex license model and high price.” However, during that period Getty has dramatically reduced the number of RM images in its collection and made it much harder for customers to find those images. They have made RF the default search and basically hidden the RM images so most customers never see them.



Getty has watched Shutterstock grow and seems to believe that they can take customers from Shutterstock if they just make it clearer to customers that everything they have to offer is low priced RF.

On the other hand, if a customer searches for RF images on Gettyimages.com, and looks for a price, they will find the following pricing schedule:

Extra Small $50
Small $175
Medium $375
Large $499

Information in the image pricing template also says “volume discounts available.”

To the best of my knowledge no one pays these list prices. Everyone gets some type of deal. Over one-third of the images are licensed for prices less than $5 and 72% are licensed for prices under $20. No customer that doesn’t already know that they must call and negotiate a price for anything they want to use is going to buy one of these images at the list price. How is this pricing strategy making it easier for the customer?

Another factor to consider is that Getty currently has 25,357,466 RF images in the Creative section of its site; Shutterstock has 313,000,000. Any customer considering the two offerings is likely to believe that they will have a much broader choice on Shutterstock than Getty. Thus, I would think that it is unlikely that many customers will switch suppliers.

Thinking ahead, Getty may be planning to fully integrate the iStock collection with the Getty images Creative collection and also lump the Getty Editorial collection into one super collection of all their still images and illustrations. If they do that, they might come close, and maybe exceed, the Shutterstock number. In that case customers might have a more comparative choice, but it will hard for Getty to argue that they have a “higher quality” collection because they will have dumped a significant portion of the “quality” RM images that were the justification for higher prices.

Another thing to consider about Shutterstock customers is that their numbers have not been growing (See here). Basically, there are not that many new customers to be had by anyone. The only way to grow the number of images licensed significantly is to take customers away from Shutterstock, AdobeStock or Alamy and that is going to be very difficult to do.

Getty will also have chased away all the image creators who have been trying to earn a living producing stock images and were willing to spend money to achieve higher “production values.” Going forward, stock photography will be strictly a low income, part-time, amateur endeavor.

What Should Creators Do


The volume of sales for the small RF fees is unlikely to generate enough revenue for any individual photographer to justify continued production of stock images as a business. Countless people will still produce stock images as a hobby, or for part-time pleasure, but very few will be able to generate sufficient income from this activity to justify continuing.

Part of the problem is that none of the remaining RM agencies will have a broad cross section of all the different types of images that the average customer needs. Each tends to specialize in a particular type of imagery. In addition, image search tends to vary slightly with each agency making it harder to deal with multiple agencies. From a customer’s perspective trying to find an agency with the right image for a particular need will be very difficult and not the best use of the customer’s time.

If the RM licensing strategy is to continue there will need to be a single, large, worldwide database that contains virtually all the images available from various RM sources. That, in effect, is was what Getty used to provide. Given the general depressed state of RM licensing in seems highly unlikely that anyone will be able to justify the expense of organizing and building such a database.

Currently, there are 2,470,799 RM images on Gettyimages.com representing 9.5% of the total Creative collection. About half of these images are in collections that Getty either wholly owns or controls. The other half belong to photographers who have individual contracts with Getty to represent their work. Based on what is being said on the forums it appears that many photographers are prepared to cancel their Getty contracts and demand that their images be removed.

Some photographers will need to make a decision as to whether they want to allow their images to be licensed by Getty as RF in the future. Others will not be given a choice to switch to RF and their images will be deleted. Getty has supplied the following answer to some, but not all, of its photographers.
    Can you please move all of my RM images to RF?
    We closely reviewed the RM collections on a number of factors, including subject area and content currently available in RF. Your RM images have not been selected for migration – we suggest focusing on creating and submitting new imagery to RF based on our Creative Insights briefs available on the Contributor Community website.

    Can I resubmit my images as RF? 
    We do not recommend resubmitting your RM images to RF. We closely reviewed the RM collections, based on revenue and content current available in RF, to select images that we feel will compete well in RF. We suggest focusing on creating and submitting new imagery to RF based on our Creative Insights briefs.
It may also be worthwhile to see if Getty will move exclusive RM images to the iStock Exclusive collection. That pretty much guarantees that your images will be licensed at a higher price than you have been getting for most Getty RM collection sales. In theory, the RM images should have been licensed at a higher price, but as a practical matter the pricing structure for iStock Exclusive images is actually higher than that of most current RM Getty sales. There is also the possibility that both collections will be integrated in the near future.

If your Getty contract is cancelled, but you want to try to continue to earn some revenue from the images then the next best options are to try to go to either Shutterstock Offset, AdobeStock Premium or Stocksy. They all license images for higher than normal RF or microstock prices.

One problem with this strategy is that you must go through all the hassle of re-uploading the images. For the money you’re likely to earn it may not be worth the trouble.

The other option is to put all the same images with Shutterstock, AdobeStock, iStock and Alamy on a non-exclusive basis. You’ll likely make significantly more sales than you have with Getty, or the higher priced Microstock collections listed above, but for mostly lower royalties so the net income may not be as good.

The stock photo market has declined so much in recent years that there are no longer any really “good” options, but the above may be the best alternatives.


Copyright © 2019 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

  • Frank Golomb Posted Nov 9, 2019
    This sounds to me that there will be a lot of RM Collections and consequently lifeworks "homeless" in a while. Because a change from RM to RF might cause conflicts with the licence history the image had before. There might be conflicts with copyright laws.

  • Doug Segal Posted Nov 11, 2019
    What they don't cover in Getty's RM obituary:
    A) Will photographers be given an opportunity to convert their existing RM material to RF? (reading between the lines near the bottom of this essay, it seems like the answer to this will be NO...but they are not explicit). Appreciate what you are saying Frank but as about 98% of RM images listed on Getty were never previously licensed at all, it doesn't make sense to not allow those contributors to convert them to RF, does it? Think of the money, time and effort invested to edit, scan, retouch, keyword,etc those many millions of images?

    B) Makes one wonder about the accuracy of their extensive customer market research used to make the determination to boot RM, "We conducted extensive customer research and testing on RF versus rights-managed (RM)..", , if, presumably, it was the same type of customer market research done earlier in the year which they claim turned out to be dead wrong about their Market Freeze offering ?
    " Earlier this year, we introduced Market Freeze to differentiate rights-managed (RM) from RF Stills by including a base level of exclusivity with RM licenses. This has not seen the customer interest we had expected, and RM licenses and revenue continue to rapidly decline."
    So it goes.

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