How to License Your Photography as Stock

Overview

For those of you used to managing your businesses as
assignment photographers, licensing existing imagery (or stock) can be
confusing. Understanding the differences between Rights-Managed and Royalty
Free pricing is the first place to start, along with trying out different tools
built to help photographers properly quote clients looking to license their
images.

Rights-Managed

Rights-Managed photography is the traditional model of
licensing whereby the licensing fee is derived from a specific usage. For
example, a quarter page ad in a North American publication with a circulation
of 500,000 for one month yields a fee that is different from a single billboard
running for three months.

Rights-Managed images are associated with higher fees,
and also have the ability to be licensed with various forms of exclusivity. For
example, a bank might use an image of a person at an ATM and ask for
categorical exclusivity to prevent a competitor from using the same image.
Exclusivity adds another component to the price of the license, but it can be
very important to certain clients.

Rights-Managed “calculators” are used to derive pricing
of an image. The calculator is a large matrix of various usages with an
associated price. PhotoShelter’s rights-managed calculator is based on the ubiquitous
and highly regarded FotoQuote program developed by Cradoc Corp.

 

Royalty-Free

Royalty-Free emerged in the 1980s as a way to license images without regards to usage. The model gained popularity with buyers because they could amass their own image libraries and re-use images without having to relicense the image for each usage. The rise of CD-ROMs in the late 1980s and early 1990s was a key factor in the proliferation of Royalty-Free images.

Royalty-Free images used to be associated with poor(er) quality, but nowadays, image quality is not a good indicator of licensing type. More often, it’s just a function of the photographer’s (or agent’s) desire.

Proponents of Rights-Managed licensing point to Royalty-Free images as a reason for price deflation in the industry, but just as likely a culprit was the glut of photos and more efficient mechanisms for distribution.

 

Image Distribution

Boutique stock photography companies used to be the de facto sales channel for stock images. Each company would typically have a subject specialty and photo buyers would have to contact multiple agencies to fulfill their needs. The process was time-consuming since researchers would have to literally scour through physical archives to find images. The proliferation of computers and the Internet significantly changed the face of stock photography.

Getty Images emerged as the dominant leader in the stock photography industry through consolidation of many boutique agencies along with making their collection accessible and licensable through the Internet. Today, Getty generates in excess of US$800MM in revenue through the licensing of rights-managed, royalty-free, footage, and other licensing.

The rise of the Internet has allowed a few intrepid photographers to set up shop on their own websites and turn a 100% profit on image licenses. More commonly, photographers use agencies to distribute their images.

 

Microstock and Deflationary Pricing

Microstock has emerged as a significant force in stock photography. The concept emerged from photo trading amongst graphic designers, but soon became commercialized and popularized by low pricing. Images are often sold on a credit basis (because the credit card processing fees would be prohibitively high at that price point), with contributors often being paid back in credits, which they can redeem for cash.

Microstock is necessarily a volume game, where a contributor has to sell literally thousands of images to make a decent wage. For most participants in microstock, it’s less of a business and more of a hobby and vanity exercise – as the microstock companies earn a disproportionate share of the sales and earnings can literally be in the pennies for the photographers.

Nevertheless, microstock continues to be a fast growing segment of the stock industry whose proponents say they are monetizing an untapped segment of photography.

 

Photographer Earnings

The industry bellwether, Getty Images, pays photographers an average of 35% (RM) and 20% (RF) of the image sale. This figure has been declining with the creation of subscription services and bulk discounts.

Microstock typically pays out between 20-30% of each image sale, where images sell for no more than $20.

Although the top earners in the industry can make in excess of several hundred thousand dollars per year, this is becoming increasingly rare as more part-time photographers enter the space, and companies squeeze photography royalties.

 

If I want to sell stock, where should I sell it?

Of course we are biased, but if you are interested in selling high-quality stock photography, we truly believe that we at PhotoShelter are providing you with the best option:
 

–          We are open to all photographers, but edit the collection to a high degree of quality

–          We sell images at their full market prices and have taken a stand against microstock

–          We have a world-class direct sales force selling your images to all of the top buyers in the space – advertising, editorial, publishing, corporate, and design

–          We have a community of 32,000 independent photographers and growing every day – with forums and other ways for you guys to discuss issues and get help from each other

–          We give Photographers the highest royalty rates in the industry – off of every sale