The photo factory

Commercial stock photography has been walking on its head. Since its beginning, it has approached its own business space with an upside down approach.

Let me explain : At the beginning, Photographers would shoot images that ended up on  online storage system with the hope that one day there will be a demand for these images. As the number-crushing corpocrates invaded this business, past sales report became the investigative tool to predict demand. The principal is quite simple : If someone, somewhere, licensed an image then someone else, somewhere else, surely needed the same one. To predict future demand, some even hired “experts” to perform field research on trends and gather market intelligence. The result ? a quite imperfect method of prediction investigation that currently results in a very imprecise production.

Enters a company called Demand Media. Self titled “The leader in social media”, the company is a huge automated content analyst and producer.  Using a combination of sophisticated algorithms and millions of Google search entries, it delivers what keywords, or group of keywords, are, or will be, the most frequently entered. It then spits out a list of topics that it posts on freelancing websites where anyone can produce the desired results in exchange for a few dollars. It then takes the newly created content, posts it on You Tube ( They only deal with video for the time being) and sells the space to advertisers. Videographers get paid a flat fee of about $20 per video.

Since their algorithm predicts the popularity of a search query, they can guarantee a substantial level of traffic to their advertiser clients. It is working so well that Google (owner of You Tube) has signed a deal with them, too happy to finally find a way to monetize their video hosting site. The videos are mostly self-help, DIY ( Do It Yourself) and tips.

Demand Media, according to Wired magazine, posts about 4,000 new videos a day thanks to a worldwide army of freelancers pumping thousand of clips, or articles, based on what an emotionless algorithm spits out everyday. ” This year, the privately held Demand is expected to bring in about $200 million in revenue; its most recent round of financing by blue-chip investors valued the company at $1 billion.” continues Wired Magazine.

It is an industrial use of the “database of intention“. The database of intention, for those who are unfamiliar with it, is what Google made a fortune upon. It is all these search queries that are entered on Google.com every second that explicitly shows what people are looking for. While Google monetized upon it by selling ads linked to the query, Demand Media is making its income by producing content.

So what about stock photogrpahy ? Well, that is the next step for Demand Media. Already producing clips and article by the pound, they are now going to enter the photography space. Not by offering images that maybe someone somewhere might be looking for but actual response to real searches. Thus putting the industry back on its feet. Sure, the first steps will be to produce images to look at, and not to license. But it will not be long before someone ( Istock photo anyone?) will realize the huge potential of this image database and license its content. Imagine, a photo library entirely made of images that people are actually looking for. That would be a first.

The ramification of this game changer are enormous for the stock market. First, it will attract a lot of microstockers who will prefer to be paid on the shoot rather than a commission on sale. Some will actually make much more revenue than they currently do on current sites. The clientele of these microstock sites might completely shift away and use the Demand Media database since they will be sure to find what they are looking for. Finally, traditional Stock agency will finally be overwhelmed with a Ford like approach to their trade.

Demand Media has a lot of cash in its bank and a novel approach to the Stock Photography industry, cutting cost to a minimum while increasing productivity. It’s what Getty images or Corbis should have done if they had been smart, instead of wasting there time and money on “artists”. Might be too late for both. It is certainly too late for the traditional industry.

Full article on Demand Media here in Wired Magazine.

This entry was posted on October 20, 2009 at 9:06 am and is filed under web 2.0, Midstock, technology, commercial stock, prosumer, finance, Royalty free, getty, corbis, transaction, Microstock. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or trackback from your own site.

| Print