August 22, 2008 by pmelcher.

I am no friend of fair use.  “Fair Use is a USA law that provides for the legal, non-licensed citation or incorporation of copyrighted material in another author’s work under a four-factor balancing test.  In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include:

1. the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
2. the nature of the copyrighted work;
3. the amount and substantially of the portion used in relation to the copyrighted work as a whole; and
4. the effect of the use upon the potential market for or value of the copyrighted work.”

This law does not even require that someone get a permission from the author or, at least,  informed them of such usage. Guess common courtesy does not exist in US copyright laws. Obviously, “non- licensed” means free. Fortunately, most people do not abuse this law that is widely open to interpretation.
This law has been in existence for a long time and is to me, much more damaging then the potentially upcoming Orphan Work Bill. After all, in this case, one knows the copyright owner but is still allow to use his/her work for free and without having to be polite about it.
Created to help scholar use reference work without going bankrupt, it has become the principle doorway to common copyright infringement.
Why not offer a small $1 licensing fee for those poor scholars that cannot afford paying full price. Or a special “education” fee, like Apple does with its computers. ( mmm…you have to see how much the US University charge per year/per student . Wonder what they do with that money instead of paying artists).
The idea is that every work used should be compensated, regardless of the amount. There has been work done thus compensation should be applied.
However that is not the worst. A famous blog situated on one of these new community based portal ( no, not DigitalRailroad) has been using an insane amount of images. At first, it seemed that since it is a professional blog, created with the obvious intend to drive traffic to its Collection, it would be properly licensing these images.
Imagine my shock ( and awe) when I heard that it does not. It recently used an image from a very well known photo agency that it ripped from another online legitimate publication and used it, along others, on its blog. No permission and no money exchange.
When asked why they would use images without licensing them when they are in image licensing business?  they  responded, “I can’t answer that question.”
They did pull the image down, only to be replaced by another from another agency. Probably without permission. What compels a company that is itself in the image licensing business to not pay for images that they clearly use for promotional usage?  Especially after screaming loud and clear they would be spending over $1 million in marketing this year. Is there no % in that budget to pay for licensing other people images ?

It would be nice, and honest, for that company, to clearly define their policy on the usage of photograph and stop claiming their are the defenders of the photographers when they boldly rip images from other sites like cheap second hand robbers.

Posted in copyright, technology, license, No sense, editorial, transaction, law | Print | 3 Comments »

August 4, 2008 by pmelcher.

let them eat cake, she had said. As the eyes of the world are turning toward China and the upcoming Olympics, this is a good time to reflect on how photography is evolving. Not as a medium, but as a media.

Getty images licenses a series of exclusive images to People and Hello! for a reported $14 million. No one questions this. furthermore, no one seems to believe that the number is just plainly insane. On one side of the spectrum, images sell at a buck a piece and on the other, at double digit millions of dollars.  Doesn’t make much sense. And I will tell you why : Image pricing was a combination factor of quality/difficulty/usability. The more an image was going to be used, or seen, the more it would cost. The better, or rather, the more relevant the images were, the more its price would go up. Finally, the more an image was hard to get, the more the price would go up. If you look at the RF microstock model, none of the above is true anymore. Does the Jolie twins bring so much value that they will reep sales above $7 million ( assuming People paid half the bill ?) . lets see : Angelina first baby picture sold for $4million. People sold 2.2 million copies at a cover price of 3.95. That is roughly  $ 8.8 million if you complitely ignore the subscribers. If they raised their advertising space rate, they should have broken even. At $7 million, it becomes more of a problem. After all , it is not because she had twins that there will be double the readership, is it ?

Actually, these images have become a story by themselves. They were priced way before Angelina even had the babies. And by whom ? The media. Rumors, speculation, interviews, opinions were running  like a mountain stream in Spring, finally settling around anywhere from $11 million to $14 million.

Interesting thus, that Getty sold these images for the same price as people assume someone would sell these images. Did the  megastar couple take the hint from the crowdsourcing pricing or is it just hype ? After all, the crowd will be more eager to see images that are worth $14 million dollars than a few bucks. Thus both Getty, People and Hello ! profit from screaming that those images were sold for $14 million. It benefits everyone, even the couple who gets to give even more money to charity.

Furthermore, does anyone who has been in this industry for a while really think that competing magazine USweekly or IN TOUCH  stop bidding at 13,999,999 .00 and said we give up ? Or that if the National enquirer had bid $15 million, it would have been in their latest issue ? Publicists and stars want to be in People magazine, not in tabloids.

Who cares if it is not true, really. What matters here is that these images  got a celebrity status, even before they were even taken.

The second incident is the revelation by Newsweek DP that the Olympics will be mostly a .com event. Ex-photography director, Mary Ann Golon had told me that TIME will be doing the same a few months back . Seems that this Olympic season will be online with additional reporting in print. The slow decay of the paper support is becoming more apparent as it cannot compete with the feeding frenzy. Photography becomes free at last of the written word and regains a position of strength. It can live, breath and exist by itself  on an online slideshow that doesn’t need much explanation. This will only continue to erode the news weeklies here and worldwide. It will also put much more pressure on the photographers to fully report with images and not just be an accompaniment to the text. Its good news.

Posted in license, TIME, celebrity, magazine, Newsweek, photojournalism, slideshow, Royalty free, getty, editorial, transaction, Microstock | Print | 4 Comments »

July 23, 2008 by pmelcher.

Woke up this morning to this news: “Dubai, United Arab Emirates, July 21, 2008. Celeb Arabia, subsidiary of Dubai Photographers Agency, the source for authentic celebrity images, today announces the launch of its Middle East Celebrity Photo Collection at CelebArabia.com.”

Cool, I thought… let’s discover Arabian celebrities :  The local Britney Spears or the Sheik heiress that is behaving like Paris Hilton.Who’s hot and who’s not. Well, it was quite a disappointment. The Paris Hilton of Dubai and region is…Paris Hilton.

Pretty damn disappointing.. I know that corporate America is a champion at exporting its brands and I very well know that what happens in Hollywood has more repercussion then  that annoying butterfly in the Amazon forest responsible for so many hurricanes. But still. Europe has a lot of local celebrities, so why not Dubai ? . Can’t they make more money with their celebrity rather than having to import American ones ? Sad…very sad.

However, that is not what really shocked me. The pricing is the biggest smack in my face :

Celebrity photos, and rather good ones, taken by pros, at $44,90 an image ? Ouch ! Cheaper if you buy 100 !!. Paparazzi by the pound. Not sure how it works in Dubai, but usually paparazzi images, being hard to get, sell for a premium. Maybe because they look sometimes out of focus, the “Dubainese” market considers them as midstock material ? The license seems to be “rights ready” as it is mentioned a few time on the site. If it is anything like the Getty one, that means 10 years, $44,90. an image.Well, that is a market that is dead even before being commercially interesting.

Seriously, there should be a license that people should pass before having the right to sell images. Like Real Estate agents. This is getting totally ridiculous with absolutely no sense on how the images are priced.

The pricing of images is like walking into a frat house the day after blow out party : its all over the place and it smells bad. It is embarrassing for those of us trying to make it a ligitimate business because image buyers think we follow some kind of rule.

The rule is simple these days : “My images are cheaper than the guy next door. Even if he moved out. “

Posted in magazine, technology, Pacific coast news, celebrity, license, editorial, transaction, Microstock | Print | No Comments »

July 19, 2008 by pmelcher.

It is not the usage but the image. A flew of photo agencies, including recently Alamy, have come out with special pricing plans for blogs ( non commercial ones).  It appears to be specially arranged  to compete against  microstock, as the prices are very, very low.

Which begs the question and realization that more and more, these days, images are sold based on usage and never on content.  Since the value of an image can vary immensely from one person to another, corporations, like Corbis or Getty have just decided to ignore it in their budgets. It is a known fact that corporations hate variables. So they take a whole sloosh of images and apply the same pricing. All of these over there are RF, these are Rights Ready, and those are too old. Furthermore, they believe that an image only has a value when it is used and that value is only quantified by the way it used.

As much as simplicity is appealing, as much as it doesn’t reflect the real value of an image. As we all know, some are really easy to get ( the Eiffel tower, for example) and some are really hard ( Angelina Jolie posing with her newborn twins) . One would never apply the same pricing rules to those 2 images, if one was a little versed in photography sales. But it doesn’t seem to be the case anymore. In between these two images, exist a whole range of pictures that are either more or less easy to take and also, have added value created by the photographers themselves ( the Eiffel tower taken by a National geographic photographer).

Example:

let say I take a nice image of the Eiffel Tower.  Nothing special. I license this image to a blog. I get 5 cents. Same image, I license it to Microsoft worlwide 10 years unlimited rights desktop usage. $60,000.  Hmmm… what is the value of my image? 5 cents or $60,000?

But more important, is it really the usage of my image that defines its value ? Shouldn’t be the image itself ? More like a painting ? You will buy a Picasso for millions of dollars regardless you put in a closet or decide to attach it on the walls of the British Museum.

Aaaaah, but photography is not art, you will say. You cannot compare. Well, my friend, why would an Angelina  Jolie and Twins go for a cool $11 million ?

Well, it is not the photographer that matters here, it is the subject, you will argue.

Absolutly !!! my point exactly. Photography is even more wicked that its value is not even obvious by who took the image, but what is on it. Sure you have the Masters who commend a certain price. But the bulk load of images are taken by complete unknowns that will remain so. But some of their image will command huge prices.

Because of how they are used? Or because of their content?

At this point you have to agree with me.

While editorial agencies are very aware of the statue and value of their image, stock couldn’t care less. Here, you can have all these images for a penny an image, because after all, no one comes and visits your site. Well, that is terribly wrong and reinforce the idea to clients that photography is a commodity. If someone doesn’t have the budget to pay for a great image, too bad, blog or no blog.

There is value in some images and client should pay for that value.

On another completely unrelated note:  Rumors are spreading that Getty and other wire service are asking their news  photographers to shoot  events with commercial stock resale in mind. Meaning that those  photojournalists no longer shoot what they see but try to , for example, to purposelessly blur peoples faces in order not to need a model release later. To maximize the lifetime potential for an image. As much as it make sense for the agency, as much as it is digging a little bit more in the wound of photojournalism, making it less and less credible every day.

We will probably see more and more denature photographs of world events as photographers will try to cover them on a more “stocky” way .

Posted in photojournalism, license, celebrity, commercial stock, transaction, editorial, Royalty free, getty, corbis, news, Microstock | Print | No Comments »

July 8, 2008 by pmelcher.

By now, you must have read all about the Getty Image/Flickr deal. In a nutshell, Flickr announced that Getty Images has the right to go through the Flickr collection and pick and choose the images that they want to distribute.

Now, seldom know that Flickr has been shopping around for the last two years for a way to license its content. They have approach many existing companies in order to investigate their options. I am not at liberty to say which but lets just say they are not your traditional mom and pops. But like with any huge company, time is not an issue and most potential, at first very excited, ended their conversations with a resentful puff and walking away with what everyone thought was a goldmine. When you looked closer, it is more like a coalmine. Lots of digging for little return. One huge issue, is that, although Flickr has a clear copyright policy, most people don’t care and upload whatever they want anyway. Since nothing is for sale, no copyright infringement lawsuit has ever surfaced, but most certainly a lot of “cease and desist” notices have circulated.

The second very important issue, is that Flickr has a beautiful facade, but behind it,  lies a dump yard of crappy snapshots. Their “Interrestingness” engine is a model of programming done with genius. Only the best images  surface, hiding the ugly muck below.

While these talks where going on, some mash up 2.0 companies tried to take advantage of Flickr’s API to lure users to shift platforms and take advantage of their licensing engines. That was a lost battle as Flickr monitored those links very closely and shut down  any one who  apparent motivation was money. No more than a little slap on the hand.

Getty, having a whole department in charge of making new deals could simply  not let go. These guys lose their job if they do not make any new deals. So they came out with this wackadoodle arrangement: Flick makes deal with Getty Images.

Wait a minute, Flickr doesn’t own, nor does it represent any of its content. It is only a sharing platform. How can they make a deal on behalf of their users ? They can advise them, yes, but certainly not make a deal for them. Getty will still have to ask each and everyone of them for permission to license their images. But be no fool, this has been going on for a long time. I do not know of any photo agency that has not already contacted users of Flick in order to represent their work. And those who didn’t are either fools  or not in the commercial stock business. This deal doesn’t change that, as Flickr cannot dictate anything to its users.

Furthermore only Getty, or its retarded companion Corbis, could afford such a deal. It will take them a huge time to edit through the content and find the pearls. And that is money spend, not received. Let’s say they do find a photographer with great talent, nothing guarantees them that he or she will sign up with them. Nothing at all. Or they have might have already signed with someone else. This is Gargantuan work for little return.

This deal is just a pack of hot air. We all know that Getty is no fool and that this is just a big PR balloon. It will fly, get some people very excited and overheated, and just disappear after a short sting.

What is however captivating is that Getty now officially announced, with this deal, that it can no longer trust its own suppliers or photographers with providing them with the right images. It is  also an admittance of the failure of both  their internal “creative research and intelligence” and in its long held belief that it had secured the right partnerships. To proactively and officially reach out to amateurs is sending a loud and clear message that their current content is not adapted anymore.

After thought : So what happens to those poor pro photographers schmucks who paid $50 dollars to get their images on Getty Images under the brand “Photographer’s Choice“? Let me get this straight : you’re an amateur and upload to Flickr, Getty images includes your images for free. You are a pro unwilling to upload to Flickr, maybe because you don’t want then stolen and you have to pay $50 per approve image ? It doesn’t compute

Posted in Search, license, technology, commercial stock, yahoo, web 2.0, corbis, finance, flickr, prosumer, getty | Print | No Comments »

July 7, 2008 by pmelcher.

Even in a world of quirky names, content continues to rule. Picapp, the source for free legal images for blogs, has just signed up celebrity news agency Splashnews as a new provider. Here’s the deal : 2 companies, one similar idea. How to license images to the high volume community of bloggers worldwide ( 6 billion , I believe). Also, how to license images without these images ever leaving the server, thus avoiding illegal duplication. ( Orphan work anyone ?)

Historically, Picapp was the first to launch, with a revenue sharing deal that made advertising the only source of revenue. GumGum, not far behind, launches with a similar idea. However, the user here has a choice of adverting or paying a pay per view fee.

But the business model is not enough to grab attention, you need the right content. Again, two strategies : Picapp leverages its existing relationship through Picscout and draws the big guns ( i.e Getty). Gumgum, in order to outsmart them and after looking at the blogosphere, goes for entertainment. After all, the celebrity obsessed blogs are not only the most active, but also the biggest consumers of photos. What would be a celebrity site with no images, right ? They quickly signed Pacific Coast news, Splash news and Starmax. The show can begin. And it did. While Picapp runs around making deals with blog publishers and refine their offering ( ie multi size images, hidden Picguy, etc), GumGum seems to be satisfied with their offering.And it seemed to work.

But Picapp is no dumdum. They just signed Splashnews too, realizing they where the biggest money making content provider of Gumgum. Ouch ! The result will soon be felt. One has vast offering, from sports to paparazzi celeb, while the other seems stuck in the muck. Same technology and very similar business model. Who do you think will win?

At the end, it is always the same result. Technology is not an answer in itself, it is just a pipe. You can have the greatest system in the world, if you do not have the content, you die. Think Betamax or more recently, Blu Ray. Geeks are the worst managers of their own technology as they always, always make the same mistake in believing it can overcome everything.  It can’t.

Posted in technology, gumgum, Pacific coast news, idee, license, transaction, finance, web 2.0, editorial | Print | No Comments »

June 23, 2008 by pmelcher.

So revenues from traditional clients seem to decline. Price per image are stagnating, if not dropping, while market shares seem to be eaten away by more aggressive, younger companies that have much lower operating costs. The cost of entry in the photo agency world has dropped so low that a new photo agency is born almost every month. In all categories, RM, RF, Micro, editorial. While they are not really offering anything new, nor do they have any long term planning, they dilute the general offering of stock image on the market by making more of the same images available.

Sites like Alamy, Photoshelter and others like microstock have even broken the traditional link between photographers and agencies and are now just acting as distributors and plain lean mean selling machines. They have little or no personal regards for the photographers they represent, have never met them nor do they intend to, have no connections with their careers, have no clue what they will shoot next and almost couldn’t care less. All they want to do is connect them with as many buyers as possible and collect a percentage on every license granted, a la Ebay.

Some traditional agencies  distributors have already done that (think Getty Images here). Part of Istockphoto recent growth must be heavily tied to its introduction to existing Getty Image clients. It still remains compartmentalized, for now. The very near future will be to see all prices and all contributors on the same platform. There is no reason to keep the brand separated on different websites, is there ?

So, what is a photo agency to do in such a world ? Well, some are looking for collateral revenues. The editorial celebrity space is a good place to look for answers. Most have created their own blogs, along with advertising. Traffic generates attention but also revenue. They were already receiving a lot of hits from consumers looking for the latest images, so why not capitalize on it ? Some like X17 ( x17online)  are doing quite well. Getty Image, with its ViewImages and Jamd’ are also in this space, in a slightly different way.

Splashnews has introduced an interesting experiment recently. Under the heading of Splash Style, they take  online fashion shopping to the next level > here is how it works. You watch one of their paparazzi videos and click on a dress or handbag that you like. It appears on the right as still picture. You can then proceed, by clicking on the still, to go to an online store who will be more then happy to sell you that dress.

Obviously, Splash is taking a commission on the sales, even maybe just on the click to the store. After all, someone might not purchase that dress immediately. While clicking on a specific body part of someone who doesn’t want to be filmed is a tricky exercise, ( go ahead, try it. I’ll wait here.

…Ok, back ? Hard, no ?,

the concept is appealing. How to make money with stills, or videos, on your site, without licensing any images and respecting your traditional clients and no overhead. Without even needing inside information, it is quite evident that this model is not very lucrative. Yet. But it is another very good example of how modern photo agencies need to break out of the traditional licensing model and aggressively seek new revenue streams. We had touched on that topic here.

The days of quietly waiting at a desk for someone to call seeking for an image that you might or not have are over. Gone. Finished. Someone has gotten to them faster, sooner and probably cheaper. Nothing personal, they needed to, in order to survive. They made the mistake of entering this business because it was cheap and looked really easy. Now they are stuck in it. And you are stuck with them.

So, instead of waiting for the good old days to come back, ( which they will not because they never existed), or Getty to call and offer a few hundreds of millions for you archive ( they will not, they have what they need right now), or just some incredible lucky break ( better play the Lotto..), it is time to look for those collateral revenues that might just end up being your main revenue.

Posted in celebrity, magazine, technology, commercial stock, license, finance, getty, editorial, transaction, Microstock | Print | No Comments »

June 14, 2008 by pmelcher.

$54,000 ?… “Advertisers pay as much as $54,000 to run a one-day ad package on the site.” says the LA times article on Perezhilton.com. It is already a known fact that some agencies now license images to that site, in full knowledge of its past infringement and the current lawsuit. What is less known is that those images are licensed for a mere $50 or so. Some of these agencies are probably also screaming about microstock and  its low balling prices.

PerezHilton.com is not a small one person operation anymore. It is well staffed. It receives 7 million pages/view a day. A day ! that is 7 times the amount of readers that people magazine gets in a week. With a licensing system like gumgum.com, at .20 cents per one thousand views, that would be $1,400 per day/per image.

Yet, they pay much, much less for images.

When are photo agencies going to wake up ? Perezhilton.com, without photographs would not and could not exist. It is all about displaying photographs. Yet, they set the pricing rules and not the opposite. It is insanity.

Most say, “it’s for the publicity”.” If you sale an image to PerezHilton.com, it sells better elsewhere”. Why not pay them to publish your image, if you really believe that ? at $54,000 a pop.

There is no excuses for these ridiculous prices besides professional ineptitude. It is not the market’s fault if prices are falling, it is due to the incompetence of certain and their misunderstanding of the laws of pricing. It is due to the stubborn idiocy of some that believe that  a sale, any sale is better than nothing. No other businesses function like that. Imagine going to Tiffany’s and saying,”I will only pay $50 for that diamond necklace because, after all, I know a lot of people and when I wear it, I will tell them I got it from you”

Nike, Addidas, Canon, Sony, practically any company make you pay to advertise their product. People buy T-shirts with the brand displayed in big letters. Cameras have logo on them. It is almost impossible these days to leave a store with a product that does not carry the manufacturers name in big on it. And no one gives a break.

No one, no one goes to a clothing store and say: “I will wear your T-shirt that says Nike on it if you sell it to me for $1..”.Not even those that license images for around $50.

Yet, the photo agency world does it. At least some of its players.

At $54,000 a day on advertising, one should think PerezHilton.com can pay more than $50 an image. Especially when the site does nothing else but publish images.

Mario Lavandeira, the real person behind the site, “debuted a clothing line, sold exclusively at retail chain Hot Topic, last week. He also appears in a summer movie, “Another Gay Sequel: Gays Gone Wild,” hosts a syndicated radio show, is writing a book on celebrities and is in talks to start his own record label. “I want my own little empire.” ”

And he will succeed thanks to the helpful hands of some challengingly impaired photo agency people ( you know who you are)  who think they are outsmarting their competition by underselling. Or, hopefully, he will have to use the money he saved to pay for his blatant copyright  infringement of X17 and INF images.

Full article on Perezhilton.com here

Posted in celebrity, magazine, gumgum, license, transaction, news, law, editorial, getty | Print | No Comments »

May 20, 2008 by pmelcher.

I have to apologize. I really do. I usually do not do that. I respect other people’s opinion, as long as they are intelligent ones. But for a few months I have been reading the new blog launched by Photoshelter to go along their Collection. They hired a full time blogger, it seems, which is a great idea, and she has been steady at shooting out blogs at rapid fire speed.

And, as anything else related to photography, I pay attention. But after weeks on, I am still baffled. I do not understand a word she is writing and who she is talking about. Nada, zilch.

I thought I knew a little bit about photography being born in this business and spending most of my awake moments dealing with some aspect of it. I thought I had been a fortunate member of the human race because I have seen so many great pictures in my life that it would hard for anyone to compete.

But when I read her blog, I have no idea what and who she is talking about…really.. I had heard there was a “fine art” photography world out there created on Ansel Adams memory path but had never seen it so active. Didn’t know it was so intense. She even gets really excited when she sits on the laps of a photographer that takes close-ups of green stuff growing up in her garden.

See, in Europe, photography is not considered a fine art and there is no fine art school or courses. There is commercial stock and editorial, but nothing to encourage people to take pictures for wall hanging. Of course, there has been photographers like Jean Paul Sieff and others that have somewhat played around with the concept, but really, more exception than the rule.

But now I see the light. And I am baffled. Nothing against this person who appears to be a nice, smart, well educated and certainly photo enthusiast, but I am really, seriously baffled. The last shock was today when this image ( trust me, not the worst) was shown as part of her favorite :

I spend the day thinking about it and other images posted on that blog. I cannot make sense of why anyone would think it is a good, or great photograph. I might by unbashfully practical but it is a close-up of a badly cooked egg. The lighting is not exceptional, the subject is boring, there is nothing there for me to get excited. about. Not even shocked. Just plainly bored. Sure, for someone that has a big Loft in New York with a 20 Feet ceiling, this image on a really big big print my look cool for a while ( does it come with the smell ?). But to me, hooked on photography, it is just an egg.

Don’t take me wrong : I am really, really glad that there is not just one taste in photography. I understand that I might not like all that is liked by my peers. But that blog has published such a series of awful pictures, I had to say something. And, all this with an incessant name dropping of people I have never, ever heard of.

Every time I read the blog, I feel I open the wrong door and fell into the middle of a party I was not invited to. And for a good reason, I don’t know anyone.

Again, I have an incredible respect for the author of the blog. The only reason I bring it up it is because it is associated to Photoshelter, a commercial entity who is trying to  license images. I would have thought the blog would be related. But it is so off into another unknown direction that I read it with my jaw dropping thinking ” What the hell are they talking about?”.

And how long can they keep posting images of empty dark greenish fields with a dead tree somewhere in the horizon and a little paper wraps on the ground?

Is that what the Photoshelter collection is trying to sell ?

As that blog says…off they go to LOOK3… Hopefully for them they might finally make  it to Eggland !!!

Posted in focus, license, No sense, web 2.0, prosumer | Print | 2 Comments »

May 16, 2008 by pmelcher.

  Fotolia, one of the big six microstock company, has somewhat launched the Reseller API, thus reinventing the agency-subagency model. In a nutshell, anyone can start representing Fotolia tomorrow under another brand without actually hosting any images. The API allows you to pretend you are hosting while every search and download is actually done behind the scenes on the Fotolia server. You just build the frame. The unknown, for now, is how the revenue sharing is done. I believe that in the other reseller API models they have, it is 10% of all sales. It just might be the same. Thus, for an image sold for $5 , the “API subagent” would get $ 0.5 ( 10%) , Fotolia’s  $2.00 (their commission is 50% for an exclusive photographer minus the 10% taken by the API Subagent)  and the rest goes to the contributor.

It is a good deal for Fotolia and for the contributors. Both would do nothing more for an increase of revenue. The API subagent, on the other hand, would have to pedal hard to generate substential revenues even if his cost of entry would be exceptionnally low.

One notable change here is the API. Unlike traditional RF companies that still distribute their images to their subagent via CD , FTP or DVD’s  and have their library replicated many times around the world, this model is much, much cheaper. Fotolia will need strong servers to support the huge load increase but they must have calculated they will still come out ahead. After all, the cost of computer power is going down.  It is a model close to what AGE Fotostock has had on the market for a while with their THP fotoservice , an upload once, distribute multiple time central database. The issue  with THP, according to some of its users,  has always been that AGE tinkers with the search engine so that the AGE production always comes out first on any search.

However, the idea of not replicating your database is the next big step in photo agency distribution. In some places, the cost of image distribution to subagents reaches in the hundreds of thousand of dollars  a month with absolutely no guarantee of sales. Most of the time, these package of images are violently edited down making the cost of getting an image to an international market even more expensive. By using an API, like Fotolia, there is no editing and no fees. Picturemaxx and other companies offer this virtual API to existing photo agencies. An agency like Mauritius Images in Germany hardly host any images of its partners anymore relying only on direct connections.

So, what of our friends at Fotolia: Well, they will dilute their brand, one could argue. but with 90% of their content also available on Istock, Dreamstime, Shutterstock and others, who cares ? They have few exclusives thus do not need to protect their brand so much. They will certainly save in marketing cost, the highest channel of expenditure in any microstock agency and probably have an easier entry in smaller markets. It is easy now for someone located in Indonesia, for example, to launch a full-blown microstock agency. It will much more expansive for Istock to customize their interface for the same market.

Is Fotolia going will thus dominate the microstock world ? The subagent model is not new and the past has shown that, while it is the least expensive way to enter a foreign market, it is no guarantee of world supremacy. Everyone in the traditional RF universe uses multiple distributors worldwide with more or less success. There is more to invading a market than the ease of reach. You also need the pertinent content and the right relationship. And even when ImageBank used the franchise model, while doing well, it did not protect them from the arrivals other, better, stronger competitors like Tony Stone.

Furthermore, Fotolia might just cannibalize itself, with those resellers taking their direct clients away, eating itself from the inside. Certainly not what they are looking for as they would end up loosing revenue. It will be interesting to see what type of agreement they put in place ( not on their website at this time).

Finally, the contributors: Fotolia’s agreement does not mention anything at all. It is not  an issue currently addressed in the “agreement”. Thus I can upload images to Fotolia today and have my images sold by someone else. Is that a problem ? In copyright law yes, but I doubt that microstoshooters will see added revenue with no extra work as something negative.

After all, in this world, the more distribution channels, the better.

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