Photographers Struggle with Licensing Models


If a photographer were to open a store — or even a gallery — the business plan would be pretty simple: figure out the right price for a photo, put the price on a sticker, put the sticker next to the image, and wait for someone willing to pay that amount. It’s the way retail usually works and it’s straightforward enough. The seller names the price; the buyer gets to take it or leave it. Set up a photography business though and when it comes to ways of taking money for your photos, you’ll be spoiled for choice. Selling prints might be simple to plan (if hard to do), but event photographers have to create packages that combine hourly rates with physical products, making them flexible enough to appeal to different budgets but enticing enough to encourage clients to spend as much as they can. Even those sorts of packages though are fairly clear, and a quick look at what competitors are doing can usually provide a pretty good guide. It’s when a photographer want to license his or her photos that things start to get really complicated.

In practice, photographers are basing their prices on four main models. Choose the wrong model for your images, you could well find that you’re priced out of the market and struggling to make sales.

Microstock’s royalty-free model is the simplest. Prices are low and once a buyer has bought the image, he can do whatever he wants with it, short of selling it somewhere else. So an image that might have cost no more than a buck or three can end up on the cover of a book, on the website of an international magazine as well as on blogs, marketing material and in low-cost newsletters.

Cheap and Simple

This model’s simplicity benefits buyers — and microstock agencies — most. Designers can go from needing an image to acquiring one in just minutes, and even for a low price, and the agencies make profits by taking a small cut of lots of sales. While that can mean plenty of buyers and lots of small opportunities, it does mean that images run the risk of being underpriced and overused. Publishers are usually willing to pay several hundred dollars for an image that will appear on the cover of a major book, for example. This microstock picture cost just a few dollars on Shutterstock.

That makes microstock a useful model primarily for images that are hard to place elsewhere and for photographers without helpful contacts. “Rich,” the microstock photographer whose photo was used on a children’s book cover, also has images on Alamy. They’ve brought him one sale. Shutterstock has given him almost 6,000.

“It is near impossible for a beginner photographer to first get represented by one of those agencies, and… to have their images shown someplace where buyers will actually get to find them,” he explained. “So in that situation I turned to microstock.”

Stock is Hard for Photographers – and Hard for Buyers

Those traditional stock agencies represent a very different pricing model, one that provides full value for the image but which is both difficult for photographers to break into and complicated for buyers who have to state exactly what they plan to do with the picture. It’s a model that’s under pressure and while it’s likely to remain for top photographers and the biggest buyers who need the most exclusive images, even Getty and Corbis have subsidiaries that offer royalty-free photos in the same way as microstock.

It’s also a model that’s based on long-term revenues. Microstock photographers often post images that they shot with at least one eye on the pleasure of creating a good image. That allows them to write off at least some of their costs. Professional stock photographers shoot with both eyes on the profit, and they’re willing to invest in an image, spending money on models and location, even if it means waiting a couple of years before the sales move the photo into profit. It’s a model for professionals with exceptional commercial photos and a solid track record. Even users of PhotoShelter, a site that allows anyone to license their photos themselves using the stock industry’s usage model, tend to sell to clients they already know.

Microstock’s low-cost, royalty-free licenses and traditional stock’s rights-managed licenses represent two extremes but there also different models opening between them.

Flickr’s Free Photography Market

On Flickr, where photographers tend have a much looser grasp of market rates and the potential value of their images, contributors negotiate freely. They also often make frequent mistakes, charging too little — and often nothing at all — for their photos.

As a model, receiving or inviting requests on Flickr is popular among photo-sharers and has the advantage of providing complete flexibility. Sellers receive an amount that they agree for their photos. There’s no framework, no rules and little attention to conditions, usage limitations or terms. It contains all the anarchy of the open market but one in which an experienced buyer will always have the upper hand over an inexperienced enthusiast.

That doesn’t necessarily mean that it’s a model to avoid though. Buyers are browsing the site looking for the kinds of unique images that are hard to find elsewhere, even from stock companies, so Flickr can provide a good model for creative photographers. But it does mean that those photographers will need to look at the stock licensing model to understand the kinds of conditions they should be demanding.

Limited Licensing for Small Niches

Finally, the method that photographer Craig Holmes uses to sell images can be seen as yet another way of buying and selling photos — and one which reflects the very processes that are changing licensing models. Like microstock, his own stock site prices images based on size not usage.  Unlike microstock though, the license is limited for a year and prices begin at £25. Regular customers can download freely and receive a monthly bill.

The ability to use that model comes in part from Craig’s knowledge of his buyers and their budgets — something to which users of PhotoShelter are able to relate — and also from years of struggling with usage rights. Clients, he says, just didn’t get it.

“Gone are the days when clients wanted to chat over the price of an image,” says Craig. “They simply see it, want it there and then for a fair price.”

It’s likely that all of these models will continue to operate side-by-side for different photographers and for different buyers. Professionals will continue to sell rights managed licenses through traditional stock agencies; enthusiasts will earn small amounts for royalty free microstock images; creative photo sharers will negotiate openly with buyers as they turn up; and niche photographers will create unique models that reflect their markets and the subjects of their images. When it comes to licensing models, there’s no one sticker price


5 comments for this post.

  1. J-F Maion Said:

    Great summary. At the end of the day, for a given photographer there are not too many model options.

    PhotoDeck (www.photodeck.com) aims to make it possible (and affordable) for more photographers to create their own stock website - this will change the landscape for some photographers at least.

  2. Gary Crabbe / Enlightened Images Said:

    Good Breakdown. There is also a variation on known as the PLUS Paks, where you can license an image based on use, but with more inclusive terms the mirror the broader terns of Royalty Free. (Picture Licensing Universal System @ http://www.useplus.org)

  3. Mediebureau Said:

    i never knew that photographers nowadays struggle for pricing, i think it is safe to say that due to the advance technology most of us are struggling for one technology can make everything easy meaning everybody can do what you can do for as long as they the right tech.

  4. Julie Rorden Said:

    Good food for thought. I'll be chomping on this info for a while. I also appreciate the additional sites suggested in the follow-up comments.

  5. Damesandaler Said:

    This was actually kinda great. It's nice to have a simple summary of the possibility's for a photographer such as myself, who is just on a hobby state, to make a little money on the side. Just great :) Thanks.

    Best regards

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