But, I Don’t Know How to Price It

[by Shannon Fagan]

Over the years, I’ve developed a collective resource for image license pricing advice.  Here’s a list of some of my favorites, from the theoretical to the pragmatic.  Take them as a seed start for investigations on pricing, and also with a grain of salt.  When pricing complicated assignments and licenses, I often refer to multiple sources at once.

Negotiating Stock Photo Prices by Jim Pickerell and Cheryl Pickerell DiFrank
An all-time favorite of mine for the strategies associated with developing a pricing structure in photography.

“Fighting China’s Pirates” Wall Street Journal Article by Owen Fletcher.
It’s interesting to learn how China is handling pricing relative to the rest of the world market

Getty Images
www.gettyimages.com

Corbis
www.corbis.com
Easy to use drop down menus which give an idea of how pricing is being assessed, and licenses written, in the traditional sector of the market.

iStockphoto
www.iStockphoto.com

Dreamstime
www.dreamstime.com

Fotolia
www.fotolia.com
Great sites to observe for how micro prices are handled.

Shutterstock
www.shutterstock.com
Microstock’s main subscription service

PLUS
www.useplus.org
Great resource for licensing standards, even if not directly related to pricing.

Photography Agents
They can be a great resource for current and accepted pricing practices.  Agents generally will take on a complicated pricing scheme for an upfront fee or percentage of the job.

Shannon Fagan is the Chair of ASMP’s Stock Imaging License Committee (SILC).

The Web is Dead, Long Live the Internet…

[by Shannon Fagan]

A subject line on one of the photography email list-serves that I follow caught my eye this week, “The Web is Dead!  Long Live the Internet!”  Hmmmm.  There was a link and click, click; I was taken Wired Magazine’s site.  There, Chris Anderson and Michael Wolff have prepared a compelling article about the future of Internet traffic. I invite you to read the article as it’ll make my observations for the photo industry more compelling.

What’s occurring on the Internet has been seen in our own image licensing economy and push to future technology.

“Big sucks the traffic out of small,” Milner says in the article.  “In theory you can have a few very successful individuals controlling hundreds of millions of people. You can become big fast, and that favors the domination of strong people.”

This is very familiar to what we have observed with Getty Images and the Canon Corporation.  Getty is the world’s largest online distributor of stock images and illustration, and Canon is the world’s largest camera manufacturer.

In contrast to this article (where the web started with a low-barrier of entry), photography began with a high-barrier of entry and is moving oppositely in the other direction to a democratized access point.  This is also occurring in music, graphic design, and illustration; perhaps legal forms, writing, and news; just about anything with intellectual property merit being shared or licensed on the Internet.

“The less powerful are sapped of their reason for being by the better resourced, organized, and efficient — is perhaps the rudest shock possible to the leveled, porous, low-barrier-to-entry ethos of the Internet Age,” says Michael Wolff.  “After all, this is a battle that seemed fought and won — not just toppling newspapers and music labels but also AOL and Prodigy and anyone who built a business on the idea that a curated experience would beat out the flexibility and freedom of the Web.”

We are now witnessing a rise of low-barrier of entry to photography by the masses; something observed again first-hand at the Canon Expo in New York in early September.  Evidence of why this trend will not end is largely due in part to the stronghold that Canon “as the world’s largest camera manufacturer” has over the determination of digital imaging’s future.  This combination of The Wired Magazine article and what we are observing in the photographic economy begs the question as to whether it is possible for success outside of the majors?

To date, it was generally accepted that one must have “high-level” access to distribution and technology in order to succeed in photographic licensing online.   In other words, to make real money, and a sustainable income, one needed to secure Getty distribution with a Canon, or perhaps a Nikon, camera in hand.  There seems to have arisen an assumption amongst image content creators (and the smaller platforms assisting them) that perhaps in the future this dominance will not be as prevalent as “direct licensing” and other democratized access points level that higher playing field.  This may be true.  The Wired Magazine article’s macro view of what is happening on the Internet however, is interestingly counter to this argument.  All stock content licensing is taking place online via the Internet.  Chris Anderson and Michael Wolff give us a bit more to ponder about regarding our democratized future.

Shannon Fagan is leading up ASMP’s new Strategic Image Licensing Committee (SILC) and is a former President of the Stock Artists Alliance.

Placing Bets Away from the Middle: The Good, The Bad, The Traditional, and The Microstock

[by Shannon Fagan]

Bob Davies of PicNiche recently asked me, “There is a constant (and occasionally furious) debate about photography becoming commoditized by microstock producers and agencies. As a representative of photographers’ interests, do you think microstock or traditional stock offers the best opportunity for the stock photo industry as a whole to move forward, and will be a good or bad thing for photographers in general?

The quick answer is that we’ve received reports from several directions that indicate that during the end of 2008, on average, it did not matter which licensing model an image was placed into for stock, relative to it’s average earnings over time.  What did matter was the ability to participate efficiently, in volume, over a duration of a significant amount of time (2-3 years minimum).  It’s a fact that for the overall scope of the traditional sector of the business, there have been only declines in revenue, number of participants, and number of new images available.  It’s also a fact that for the microstock sector of the business, there have been only increases for the same measurable areas of growth.  For the future, as an investor of time and money to create new imagery, it would be advisable (like a diversified mutual fund) to attempt to place bets into all areas of image licensing: RM, RF, and Micro.  More specifically however, given natural limited time and resources, I would personally advise to focus stock shoots specifically on either one’s higher-end craft (RM) and/or lower-end volume (Micro).  I would consider pulling back on the middle area of image making (RF).  The reason for this is ironically not too dissimilar to the “pressure upon the middle-class” as seen in the US free market economy. It appears that to be in the “middle” is a difficult financial position to be in; as marketing strategist Jason Moriber with Wise Elephant explains. At this time in history for licensing content online, there appears to be more incentives for being either in the lower-end “long tail” of sales or the higher-end “luxury” end of sales. Image customers have been migrating their buying patterns to these two polar opposites.  There has been a consolidation of purchasing for reasons of price on one end and unique exclusivity on the other.  Partially this has to do with the availability of great content at low micro prices, an overabundance of mediocre content at traditional royalty-free prices, and the continued need for exclusive content where price is less of an issue.

Bob with PicNiche asks “will this be a good or bad thing for photographers?”  It will undoubtedly be a bad thing if the photographer needs to make a full-time living from photographic stock image licensing.  The reason for this is summed up in the human element of producing images.  It is extremely rare that the same photographer can individually shoot to both the high-end and low-end of the market for general consumer image needs.  This is a biological creative fact of our existence as artistic based businesses.  Stock photography is an innovative business that must manufacture images in volume to make enough money to reinvest in making more images.  Generally 99.9% of content creators do well in either one end or the other of this image creation; i.e. they are either great craftsmen or great manufacturers.  It’s difficult to be both.  While this can ideally change over time, doing it simultaneously is near impossible in the volume needed to succeed financially from stock sales alone.  It is thus advisable to focus on one end of the market and to make that decision based on one’s personal skill set and interests.

Shannon Fagan has stock imagery represented by over fifteen different global collections in all licensing models.  He is the former President of the Stock Artists Alliance.  He’s currently in the “middle” of a competitive entrepreneurial tech start-up course with The Founder Institute in New York.