July 7, 2009 by pmelcher.

There is a lot of talk these days that photography has become a commodity.

According to Wikipedia, “A commodity is something for which there is demand, but which is supplied without qualitative differentiation across a market. It is a product that is the same no matter who produces it, such as petroleum, notebook paper, or milk. In other words, copper is copper. The price of copper is universal, and fluctuates daily based on global supply and demand. Stereos, on the other hand, have many levels of quality. And, the better a stereo is [perceived to be], the more it will cost.”

Doesn’t seem the same, does it? Photography, most of the time, is not  “supplied without qualitative differentiation across a market”. Each and every photographer tries hard to have quality in  his images in order to create a qualitative differentiation.

Nor is it “a product that is the same no matter who produces it”. Even if I wanted to, I couldn’t not reproduce anyone’s work, if only because the moment has past forever.

However, these are not the only characteristic of a commodity. Wikipedia goes on by saying :

“One of the characteristics of a commodity good is that its price is determined as a function of its market as a whole. Well-established physical commodities have actively traded spot and derivative markets. Generally, these are basic resources and agricultural products such as iron ore, crude oil, coal, ethanol, salt, sugar, coffee beans, soybeans, aluminum, rice, wheat, gold and silver.”

Is photography priced as a function of the market as a whole ? Well, this is where the lines get blurry. Because of subscription models, like the one offered by Getty Images, the perception is certainly that it is. With all images priced not according to its individual value but rather as a part of a whole as well as the fact that it doesn’t not fluctuate neither by content nor volume, it is certainly treated as a commodity. Bundling images from different photographers and pricing them as a service certainly does make photography appear as a interchangeable commodity.

Not that it has have an active trading spot, for now, like crude oil or corn currently has, it certainly going in that direction. From Newscom, to Pixpalace, followed by Gumgum or Picapp, there are more and more places trying to become the De Facto central trading points, like a giant photography trade market.

another blurring point worth of attention is, as described by the same wikipedia:

“Commoditization occurs as a goods or services market loses differentiation across its supply base, often by the diffusion of the intellectual capital necessary to acquire or produce it efficiently. As such, goods that formerly carried premium margins for market participants have become commodities, such as generic pharmaceuticals and silicon chips.”

This is what we have already seen in the RF market where the incessant proliferation and inter-redistribution of brands have made them indistinguishable from one another and completely lose any differentiation. RF has become generic, opening the door to microstock, the epiphany of generic photography.

As we can see, it is not the photography that has become a commodity, but the way it is marketed. The real culprits here are the photo agencies that do not differentiate between their photographers and price there offerings as if it was a commodity. The real culprit of photography’s prices taking a hit is not the buyers market but the sellers who have come to beleive that they are selling commodities, when, in reality, they are not. They have successfully dissociated value from pricing and are even convincing buyers that the real value of their offering is in the service of supplying photography, rather than selling amazing photographs.

Thus, for a photographer, the choice is clear. If an agency offers subscriptions, or talks about photography as a commodity, than it is not your friend . It is just trying to add you to a flow of image and bundle your work in a prepackaged deal.

The same is true for image buyers who have nothing but benefits to accept a subscription or bundle deal. There will be diamonds in the constant flow of rocks and there will priced as rocks.

A image seller that dissociates the value and the price of a photograph is actually serving this self-fulfilling prophecy:

Photography will become a commodity if you want it to be.

Posted in celebrity, license, magazine, Pacific coast news, commercial stock, SIPA, prosumer, getty, editorial, transaction, finance, Microstock | Print | 1 Comment »

April 16, 2009 by pmelcher.

It is a notorious issue that the paparazzi  are getting completely out of hand in Los Angeles and its surrounding. It is even getting ridiculous. What used to be a loner sport for those looking for a rewarding exclusive shot has now become a gang like activity. There are probably more photographers waiting outside a store than they are at a Hollywood premiere. Long gone is the possibility of an exclusive, let alone a good picture. The British invasion of the early century has led to the “in your face, 28mm, flash” street photography. Thus it has become a war of who can get the closest.

It has now reached a level of absurdity and danger. Absurdity, because the value of these images are stumbling down as more and more agencies are entering the field, including Getty, hoping for financial salvation. Dangerous, because someone will get badly hurt, if not die, very soon. Those car chases with kids in the car ( for what, exactly, I am not sure), are completely irresponsible.

Apparently, a group of concerned citizen have decided to take the matter into their own hands. Called the Paparazzi reform Initiative, the group has launch a website that sheds the light on their activity and asks ( demand ?) for a code of conduct. Doubtful that it well have any impact on these guys’ conduct ( seen any woman paparazzi ?)  but it could get enough traction to make a difference.  Their demand is quite simple. They would like all media to abide by the Human Privacy and Respect in the Media Code:

No photos or video of children shall be printed or broadcast or displayed without the written consent of the parent.

No photos or video of any person clearly in distress or injured shall be printed or broadcast or displayed without the individual’s written consent.

No photos or video of individuals clearly participating in a private matter such as a vacation, exercise, eating, at school, at home, at a funeral or involved in a family activity shall be printed or broadcast or displayed without the written consent of the individuals involved.

Obviously, this code could also  apply to war/disaster photographers who would have a hard time doing their jobs if they were to abide by it. A printable PDF is attached to the site so you can send it to your favorite media outlet and show your support.

Posted in Pacific coast news, magazine, celebrity, editorial, getty | Print | 3 Comments »

March 8, 2009 by pmelcher.

 ”We’re never going to get into the business of the long lens, hiding in the bushes, hunting people down. Our business is based around relationships with celebrities and publicists and publications. The way we shoot is we’re invited. Paparazzi business is getting more play, but that’s also a very cyclical business.” Mark Kuschner, Getty’s global VP of entertainment _In Variety Magazine, July 6, 2007_

Less than two years after making that statement, Getty is going all out Paparazzi. Through a back-door, unannounced deal, the mega million photo agency has partnered with newer “all paparazzi all the time” photo agency BuzzFoto. Here’s how it goes. Buzzfoto shoots celebrities at their worst moments, when they are unprepared and unwilling to be photographed and supllies Getty with the images to license them. In an effort to avoid being directly linked to those “dirty”  images, Getty is using its Filmagic brand, the perennial garbage brand of Mediavast.

However, the Buzzfoto images are all over the Getty site and can be found alongside photographs of events for which Getty was hired as the officials photographers. The cycle is now closed. Not only can you get images of celebrities at a party, nicely schmoozing and entertaining, but you can also get them passed out in their cars, as they attempt to get home. Publicists and celebrities will sure love that.

This has been an ongoing issue for Mediavast and Getty . As the celebrity market shifted its demand from party pictures to “candids”, the prices have followed. Red carpet images space rates are now at almost a quarter of what they were worth 4 years ago. (The irony of it all  is that Getty, along with Mediavast, is highly  responsible for this drop in price of party/red carpet images) . Paparazzi images, however, have not only gain a much wider audience, they also have been able to maintain a much higher price per image. And Getty wants a piece of that too.

But how do you combine being the official photographer for a premiere or party,  where you are hired to shoot the event and thus play along the publicists demands that all look nice, happy, and beautiful  to the needs of a marketplace that would much rather see the same group of people, drunk, sick, dirty and arrested ? Especially since you went through incredible efforts to shut out your competition from all these official events, forcing them to wait outside and thus get those unauthorized shots ?

Well, you make a deal with one of them to distribute their material. Like that, your hands remain clean while you grab a piece of the cake. Funny part is that BuzzFoto was created and is run by the same man who has already sold one agency to Getty, Online USA. Coincidence or signs of a deeper relationship ? As in, lets help this man launched his pap agency so we can later on distribute it but still pretend we have nothing to do with it ?

This distribution agreement, which has a lot of rumors flying, is a great deal for Buzzfoto. It now has a wider distribution than its main competitors, X17, Splashnews, Bauer- Griffin or INF with minimum effort and no investments. Hopefully the terms of the deals were not too bad. The question remains, will they also soon see images sold for less than a dollar to those mysterious “premium subscribers” ? Will it too join the ranks of disgruntled photographers and agencies who are currently suing the mega whale for breach of contract ?

Posted in magazine, Pacific coast news, celebrity, wire service, editorial, getty | Print | No 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 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 »

February 28, 2008 by pmelcher.

“my first (and probably my last, unless you tell me it is a good idea) guest post :”

How did it start?Was it the 1890’s ?Photographers took pictures, pushed the edge of the envelope but could not do everything, they needed agents.In the meantime copyright came along to try and stop the exploitation of artists, there where always those with money willing to exploit the talents of an impoverished artist.Come the 1950’sAgents came along and entered into a partnership with the photographers, 50/50 or whatever, photographers owned the copyright, agents sold and kept the collections in hard chemical form, their business grew in the center of cities, large amounts of real estate holding pictures.

Pictures where sold for 1st rights, 2nd rights, 3rd rights and so on, the sellers had a firm grip on the marketplace.

Photographers if they where good made money in editorial, rights managed, it was a financial meritocracy, the best made the most. Art and creativity was king.

Agencies like Sygma, Sipa, Magnum, Rex, and stock agencies like Tony Stone all flourished, not by employing photographers but entering into partnerships with photographers.

20 years went buy and they became big business.

It’s the 1990’s along came digital, Getty and Corbis.

Digital, binary code was an astonishing revolution allowing millions of images to be stored in a box the size of a car instead of a 10 story building, on top of that images could be sent thousands on miles in a few seconds and reconstructed to the original quality thanks to jpeg compression, opportunity was knocking and along came the bankers and big business.

Getty and Corbis knew with a few million spent wisely they could dominate the industry, they started their acquisitions

Most of the agencies sold out but this was the first knife in the back for the photographers, the content creators, whilst an agency owner pocketed the $ 20 million from Corbis the photographer got nothing and in Sygmas case an assumption by Corbis that they owned the archive!!! I think the lawsuits are still continuing. What did I last hear Microsoft has $ 40 billion dollars in cash, what chance does a poor photographer stand?

Getty, owned by bankers saw an opportunity for consolidation and cost saving, they also thought “ Art” could be created on a 9-5 hour day, a salary and no incentive. They went ahead and spent $ 500,000 million dollars acquiring photo agencies.

Bill Gates, he initially just wanted art on his walls digitally, constantly changing to fit his mood, this was when big screen plasmas cost $ 30,000

These where tough times for artists, creative photographers who ideas where stolen, their percentages crushed, financial ruin approaching.

The agencies new owners drove hard bargains and percentages to the photographers, if you did not sign, get lost, plenty to fill the departing artists shoes, plenty of styles to copy.

A typical business model bulk sold content on monthly deals, sending thousands of pictures a day to clients, 1st rights, 2nd rights, 3rd rights became a thing of the past, your pictures where likely to be bundled at a $ 100,000 deal a month for 200,000 images used, you do the math !

By 2000 the creative photographer had been destroyed, art had become sterile, its becoming obvious bankers are not good for art!!!

Mix with this through the late 90’s early 2000 the growth of Google, a search engine with a bland front end. What the hell was this and it was free!!!

By 2004 we knew what Google was, an advertising agency who had managed to optimize the Internet and its revenue through click through revenues and who was being screwed the most in this, as if in a double whammy, creative photographers and newspapers, in fact anyone who published!!!

Those bulk all you can eat deals really paid of for Google with free rights in perpetuity as they displayed the web pages of most of the publications in the World, blatantly using fantastic images for free to drive click through revenue to their advertisers. The poor old content creator ( photographer) got nothing

Catching onto what was happening the media industry jumped on the Google band wagon and followed Getty’s lead and obtained pictures under tough contracts ,  New York Times, Tribune Group, Associated Newspaper, News International and almost every publishing group in the World started their own web sites, using pictures for peanuts whilst lamenting, “ We are loosing Money” they continued to make money off pictures through CPMs, “ accidentally” using pictures without paying  or sometimes purchased for ridiculously low fees.

Then came the blogs who where inspired by Googles claim to free usage under the The Digital Millennium Copyright Act of 1998 and other internet users of pictures, all claiming they where making no money, whilst the poor old photographer where having to spend money to apparently make nothing
Then came blogs and other internet users of pictures, all claiming they where making no money, whilst the poor old photographer where having to spend money to apparently make nothing.

In 2007 the World implodes, what happened to the American Dream ?

In 2008 when Getty Images sells for $ 2.4 billion with a failing business model they still do not understand what they did and their errors. Quite simply they where conducting business using digital with analog business models, they distributed full resolution digital images on a daily basis to hundreds of users, millions of asset files that could be stolen and used by everyone for free, whilst those users made millions on click through advertising revenue in perpetuity.

It all seemed hopeless and then along came GumGum, and they have suggested a solution that could get the creators back in financial control of their lives and the industry back on a firm foothold.

For in the end it’s the creators of new art that drives the marketplace but the industry must change the way it markets images in this maturing digital age. The artists have to be paid and then the flow of great marketable images will continue and big business through shared revenue will make even more money and survive.

And I suspect Bill Gates will still be rich!!!!

Paul Harris

Pacific Coast News
Celebrity Home Photos
Pacific Coast News Video
United States Head Office
BWP Media USA Incorporated

Posted in Midstock, license, multimedia, Search, newspaper, copyright, idee, Pacific coast news, gumgum, technology, magazine, keyword, google, editorial, law, news, corbis, finance, PACA, web 2.0, photojournalism, wire service, CEPIC, getty | Print | No Comments »