The rise of microstock has been meteoric to say the least. For the uninitiated, microstock is cheap, royalty-free stock imagery. Instead of paying $200, you pay $1. In most models, you pay for an image based on size. $1 for a small one, $20 for a larger one.
From a buyer’s perspective, this makes all the sense in the world. Most people can’t understand why they should pay several hundred dollars for an image that they want to use on a website. Most people believe that they can take the picture themselves. And most companies would go out of business if they could only use Rights-Managed imagery.
In a purely academic sense, microstock fulfills an economic demand for a low-end pricing with “above average” images. Digital photography has made microstock possible because anyone with a decent camera can create quality images. The problem with the current model is that pricing is artificially low in some cases.
Although pricing is a voodoo art, we can generally say that in a capitalistic society, the price should be what the market should bear. If you can find someone to pay $3000 for a handbag, then the price is right. In the case of images, the market will always demand cheap images, but since the pricing is fixed based on the size of the image, the price of a really good image is constrained artificially.
You could argue that a designer handbag isn’t the same thing as a photo. People are willing to pay for exclusivity at the ultra-high-end. But similarly, people will pay a little more for an image that “speaks” to them.
There are some fantastic images on iStockPhoto, fotolia and the like, and the prices are a steal. But as some critics have pointed out, butchering the market by offering images at what is effectively “below cost” has a long-term damaging effect.
If I see two images of the New York skyline, and one is $1 and the other is $20, and I really like the more expensive one, I’m likely to pay for it because the decision to buy is greater than the economic spread of $19. But without allowing the markets to price better images at a higher price, the market won’t be able to realize its full potential, and is by definition, inefficient.
One easy solution? Allow photographers to set their own prices.