State of the Stock Photography Market

- - The Future

Dan Heller delivers this treatise about the state of the stock photography market on his blog based on an interview PDN did with him (here). It’s quite long for a blog read so I pulled a few highlights out here:

PDN: What do you think the license revenue number [for stock] is, if not $2 billion?

DH: That depends upon how you make the calculation, but I would estimate it closer to 20 billion range.

… We can get a sense of this untapped potential in the huge supply of photos being used for free in one form or another, whether it’s intentional give-aways by consumers, or equal indifference to copyright infringements by working photographers.

… Yet, the real opportunity is precisely because of all those free exchanges of images. They could be converted into real dollars if there were a more mature, sustainable and reliable infrastructure that people actually knew about and participated in.

… That microstocks exist is just a byproduct of this mismanagement. But those small companies themselves don’t present major growth opportunities in their current form, and they’ll largely be reabsorbed back into the system, once it eventually materializes again in another form.

… The only thing that affects broad-scale market pricing (up or down) is the fundamental industry-wide infrastructure. Prices are low because of the lack of efficiencies to the pricing/licensing/distribution models.

… It is true that a market-based system causes unit prices to go down with increased supply, but it would only be for those kinds of images where there’s an oversupply anyway (and whose prices were unfairly and artificially supported by the aforementioned mechanisms).

PDN: Let’s assume there is $20 billion worth of photo licensing business worldwide. A lot of sales are so piddling and diffuse, how can individual photographers benefit?

DH: There are two answers: the short term (they can’t benefit) and the long term (lay a foundation for the emerging industry transformation).

There Are 11 Comments On This Article.

  1. What Dan says in this interview would go to my comment on the last post on this blog. The gist of my comment was that it is not the duty of art buyers to pay us a fair rate, but rather it is our duty as photographers to figure out a profitable business model.

    As much as many photographers would like to say to their clients, “I need more money because it’s tough to make decent living on the money your willing to pay,” it wouldn’t make a difference (unless someone comes up with a “Fair Trade” organization for photographers). Buyers rarely buy on the idea that someone else needs to make a living. Buyers pay what they think they need to pay to get what they want.

  2. Holy jesus people, stock is going through a paradigm shift like everything else! None of this information comes as a surprise. But everybody in every com industry is going through this, from APE’s mag to traditional book authors. Check out http://www.msnbc.msn.com/id/21568449/ as an example. Guy writes website, gets loved. Guy goes to publish book version of website, gets hated. Enter the new world of intellectual property.

    Everybody forgets that photography is a commodity, like copper wire and computers. A company (I don’t care what field, it does not matter) will only pay market value, and not a penny more. The market value is simple economix, where you take the number of photographers, the variations in quality, availability and base costs and mix them together. We offer a service folks, just like a plumber and HVAC repairman. It just so happens that I render a creative service rather then a structural one.

    Big thought of the night- why are there no fortune 500 companies based around the creative aspects of photography? (Kodak, Fuji, Nikon, Canon, etc. don’t count because they don’t create and sell photographs, only equipment).

  3. How this effect photo editors is that those of us that have been producing images for the licensing market are cutting back on shooting for the market. I know that I now think of my stock business as something that I do in the evenings or weekends. My workdays are now focus on either shooting assignments or marketing to generate assignments.

    I hope that Dan is right about the existence of a larger market for stock images.

    It is a shame that the microstock companies decided to exploit hobby shooters. It is a bigger shame that our former agents have jumped into bed with the microstockers instead of protecting the value of the premium images.

  4. @Adam — In part because creativity itself cannot be leveraged. A service cannot be leveraged and cannot scale. A material product that has been produced through creative thought is different, however.

    Kodak, Nikon, Canon and the rest succeed because they create the pool that every photographer swims in.

    Creating that pool is where the money is, not being in it.

    I think more photographers need to explore, conceptualise and create new business models in order to capitalise on the upheavel in the industry and to define new ways they can work, play and live. Maybe this is happening and I’m oblivious?

  5. stock is like art – you create something, hope you can sell it and make a living out of it. so.. i hereby claim copyright for the term “microart”.

  6. Wheat From Chaff

    In my experience, everything in me says that the thing to do is to distance yourself from anything that feels “stock”. Because, as we’ve seen from Getty/Corbis, it’s just a matter of time before the downward spiral makes it next to impossible to profit off of stock. It’s simply a Buyer’s Market out there, and the marketplace will right itself, always, and when it’s a Buyer’s Market, the photographers will always be on the short end of the stick. Just set your watch.

    The goal is to do work that cannot be licensed from Any Joe Schmoe. You’ve got to do something distinctive. Just Good Enough is not going to cut it; you will get left in the dust.

    What I see, in my advertising world, is a MASSIVE disparity in fees, between Editorial and Advertising. There is no other word but massive. So the shakeout will continue into 2008; if you’re not doing distinctive work, and servicing clients, and delivering quickly, your phone will simply cease to ring. There are simply way too many photographers out there. At least too many that are attempting to call themselves photographers.

    2008 and 2009 will be interesting years, indeed. We’ll see who’s still alive on Dec 31st of 2009. When everyone else is zigging, it’s time to zag. I know that it seems that Getty is the best delivery vehicle, but as we’ve seen, they are quick to cave. I would not want my future invested in that mentality.

  7. From my perspective there are plenty of stock subjects to shoot that have good value simply because very few if any other photographers are photographing the same things. I do virtually zero marketing but am still making a living on stock and a little assignment. I’m not rolling in the cash, but I have a fantastic career where I photograph subjects that interest me and buyers find me or my images because the content is unique.

    I see the downward pressure on the license prices, but often I’m able to negotiate upwards because the buyers options are limited. Simple supply and demand I guess.

    Things might be changing, but I don’t understand the doom and gloom that is spread around so much right now.

  8. Stupid Photographer

    “… Yet, the real opportunity is precisely because of all those free exchanges of images. They could be converted into real dollars if there were a more mature, sustainable and reliable infrastructure that people actually knew about and participated in.”

    If there was. If. If there were fish in bungholes, there would be no need for fishing rods.

  9. Come on APE! This obsession with the direction of the market and it’s tapped/untapped potential is becoming boring. I think about that crap during my thinking time. I don’t want to have to think about it or read about it during my unthinking time.

    Please can you get back to talking about photographers whose work you like. I want this blog to be about joyful stuff, not tedioous Barry Diller type arse.

  10. PS – The direction of the planet is going to render all this irrelevant sooner or later anyway, so can we just celebrate great photography while it is still possible.