March 16, 2019

The Future of Stock Photography

I was looking back at some old letters I wrote back in 2006 to my Photo Agencies and photographer friends concerning the major upheaval that was breaking apart a once profitable arena for photographers to make a decent living by shooting stock imagery. 

Some of the Photo agencies have changed especially when ShutterStock started out in 2003 and is now strictly RF images and is making the executives at Getty nervous about their future.

Some of the agencies mentioned in these letters are no longer in existence or have been bought by larger agencies.

Jupiterimages was bought by Getty Images and Corbis, Bill Gates photo agency, was bought by a Chinese company but images are distributed by Getty.  On a side note Bill Gates got tired of his agency, Corbis not making money and having him fork out millions a year to keep them afloat.

Part 1

November 1, 2006 

    

STATE OF STOCK

November 1, 2006

I reviewed some articles on the future of the Stock and speeches given to a PACA (Picture Archive Council of America) conference in the spring to see if anything they said back then would foreshadow the changes that have happened in the last 3-4 months in the Stock Industry and low and behold if you read between the lines they have laid out the distributors strategy right down to embracing of micro-sites, wholly owned imagery and subscription services.  The speeches were given by Mark Berns at Jupiterimages, Lewis Blackwell at Getty, Gary Shenk at Corbis, Jeffrey Burke past president of PACA and Roger Ressmeyer present president of PACA. 

"Once an industry reaches saturation, customers stop buying new images and are only trying to replace ones that have gotten old or over used.  This leads to a drop in volume.  This drop in volume leads to hyper competition between sellers and eventually negative propaganda toward their competition in order to gain market share".  

We are about to enter the mud slinging stage.  

Make no mistake about it the independent stock photographer is in a free fall without a main parachute, thrown off the Getty cargo plane to make room for wholly owned imagery that can be utilized in many licensing models without having to pay individual photographers royalties.  Do independent stock photographers have a back-up chute?   

The main thing that comes out of reading these speeches is the positive spin they put on the state of the Stock Industry and how micro-payment sites are not really going to be a threat and yet at the same time they say this there is an undercurrent of anxiety that just maybe these $1 sites will affect their business and harm the traditional stock sales.  I believe not only will these new micro-sites wipe out many existing distributors and small Agencies we have now but they will become the standard in 5 years or less.  Some of these Executives are talking about creating a super Rights Managed Exclusive Portal that deals with the highest quality imagery out there, this elite core of images would maintain higher prices against the steady decline of RPI (Return Per Image) that the Stock Industry is seeing now.  Not a chance once you open the flood gates to the consumer market the whole system will collapse and it will be a free for all with all of us in hand to hand combat with each other.  Think Walmart and what it does to the Mom and Pop neighborhood store and you know your days are numbered as an independent photographer.  Once we became content providers the writing was on the wall and just like other manufacturing jobs that have been lost in the US to foreign markets we are next.  I read where Getty is in India giving photo lessons to the locals on how to use digital cameras.  We are already being outsourced.  

One of the things that stood out was how these distribution portals put more emphasis on volume sales, speed and profits over the relationship with the independent stock photographer.  I think alot of us are still hoping for a return to the old traditional stock agency relationship where we were once partners in the business model.  It won't happen.  We supply the content but not just content but massive amounts of content and if you can't supply thousands of images a year to these portals you will probably end up losing money in the long run.  

Micro Payment Sites

They discussed micro-payment sites and one speaker believed that these micro-sites will have to eventually raise their prices per image download if they want this business model to flourish.  The question is will production costs go up enough that the photographers submitting to these sites begin to demand higher prices for their imagery?  I hope so but doubt it.  Right now I feel most of the shooters on this site enjoy the community feedback on their images ( all very positive) and they like the instructions they get on how to improve their photo skills.  And besides they have a job and don't need to make a living on these images so small sales are just icing on the cake.  Many have stated that they couldn't of imagined just a few years ago getting paid for their images, for now that's enough.  

The one making the money is the distributor and they are making big money on the backs of the photographers.  Getty and others are moving to a micro-site business model. We know Clip destroyed the main bread and butter sales for the RM photographer and $1 sites will wipe out the bread and butter income of the RF shooters.  But it won't stop there I am afraid, we are seeing the end of a livable wage in photography.  Right now if I added in my hours of scanning and computer time plus travel and shooting and equipment etc.. I am making pennies on the dollar.  What will I make once these micro-sites proliferate the market place.  For that matter what do I make now.  Some of my exclusive images sell for lower than $10.00 and some of these sales lock that image up for years.  

There will be four main licensing models I believe in the near future.

1) Wholly owned imagery

   A) RM 

   B) RF

   C) Subscription

2) Micro-payment sites

3) Open systems like Alamy

4) Pay to Play Model

Open systems like Alamy create their own problems one of which is that the shear numbers uploaded on a monthly basis makes it pretty darn hard for any one particular photographer's images being seen by a client.  Corbis has dumped over 75,000 RF images on the Alamy site already. But what else is new!

Each image has a shorter and shorter life span.  Ad agencies are asked to target a specific demographic with customized ads, picture one image being sent to 30 desktops as a pop up ad, how do you price this using a RM system.  Lower priced stock images are becoming a necessity and where do you think they are going to get these low res images, you guessed it from the crowd, the mob, the community, the consumer, call it what you will but it will be the micro-sites or free sites like Flicr (which by the way has some of the best imagery I have seen on these kinds of sites). These sites are beginning to proliferate the market and these sites offer new content in huge quantities on a daily business and the image quality is getting better and better all the time.

The music stores can only carry and sell a certain amount of packaged goods, they have limited space, so they sell only the top favorites in very selective categories. 

Traditional agencies in the Stock world acted similarly but with the tech explosion and the internet all that has changed.

They call it the "long tail" on the internet, businesses can store hundreds of thousands of cd’s with coverage and depth in all music categories.  They make money when someone buys the most popular cd by Madonna or an obscure blues artist from Alabama.  What matters is satisfying the customer and when that customer finds his oldy but goodie he might look for similar cd’s on your recommended list and buy even more obscure artists from your site.   Amazon.com is like that.  

This is happening also in the Stock Photography world but on a much larger scale.  Alamy is getting a long tail ( close to 7 million images and counting) so are micro-payment sites and now Getty is introducing a new "Open" portal that will flood the already saturated market with even more imagery.  The problem for Getty and other distributors that are sure to follow is pricing.  Micro-payment sites are all about pricing but Getty wants to keep prices higher.  I don't think you can have it both ways high prices and a glut of images and expect prices to stay high, they will fall.  My RM sales are getting obscenely low and this is at the beginning of the micro-site craze. 

Don't forget Google as a place to search and find imagery.  Google is already crowd sourcing by having a game whereby you compete with other consumers to add keywords to images on their search engine and of course people are doing this for free.  Once images can be sourced better using their search engine the consumer and clients will bypass the distribution portals altogether.  

Next Royalty Free and Getty Charging Photographers To Upload To Their Site.