Getty Image’s Gamble

by

flame of freedom 

        It was just a question of time. We have repeatedly wrote here about how the current photo licensing model is broken and obsolete . We also explained at full length how image data collection and third-party revenue are the new gold mine. Getty apparently heard and is now applying. (If you want to read how it works, there is a great full explanation here)

Getty Images announcement today that it has put 35 Million of its 80 million images up for free is no surprise. Here’s why .

The battle against copyright infringement has been lost : Between the ease to copy and publish, the rapid rise of various massive social media site, the sharing culture, the inefficacy of the industry to police and the overall carelessness of the public, defending copyright is a costly, ineffective battle. Going after hundreds of thousands ( if not millions) of bloggers, or just individuals sharing on Facebook, Twitter, Pinterest, Whatsapp, Tumblr, blogs is an impossible task. Since there is no revenue, it is a draining exercise with no incentive. Take down notices does not pay your bills. Better make deals with social media platforms, like Getty did with Pinterest, and let the images flow.

 Plunging prices is not a growth factor. For decades now, the price for images online has been plummeting. Between a race to the bottom competition amongst image providers and the massive influx of free images from UGC, there is no pressure to increase licensing prices. Quite the opposite. At a certain level, the cost of selling an image is higher than the licensing price. Getty, apparently, has reached that point. Why dedicate resources to selling images under your profit level? Sometimes something is not better than nothing.

Photography’s real value: For a long time, the thinking was that the images themselves had value. And this is still true for some of them. However ever since we have been able to track images and their usage, the value of the image has shifted to its traction. By analyzing viewers reactions to the content of an image, we can create images that have much more impact. The first step is to capture this data. We wrote at length about this here.

The 80/20 rule: Only probably 20 % of the images that Getty represents bring them 80% of their revenue. So why apply the same pricing to all its collection when the vast majority of images probably never sell or if they do, it’s for ridiculous amounts. Those 35 million images put up for free probably would have never seen the light of day. Getty Images, like all traditional stock agencies, is not in the long tail business but in the best seller business. The 20%. This move allows them to start harvesting the long tail.

Reduce and automate: Licensing images it is still a very manual hand-holding process, especially in the rights managed world. Furthermore, if you want to keep your prices high, you need higher quality service. It’s a labor intensive process and it’s a costly process. Thousands upon thousands of employees. That is not scalable. Getty has been battling this issue for many years now: how to grow without growing the headcount. Automation is the answer. Letting users pick and post images by themselves and getting revenue via ads will let them do this.

What will be the effect of Getty’s decision on the overall image licensing market?

At first, nothing. It is such a bold, surprising move that no one will move. They will wait and see what happens while investigating their options. Most will not change, some will put a toe into a copycat model, and some might join them. But, because this service will primarily be used in the very low-end of the market space, one that has been underserved by everyone else, no one will be really affected. at first. If Getty manages to be successful in their attempt, it will be too late for any one else to replicate and beat them at their own game. They will have a first mover advantage that will stick.

No one in this space can really compete with Getty on this move. The only one would be Corbis due to their very large database, but their management has notoriously been so ineffective that it will take them years to process. Associated Press might follow suit, as lately, they have increased their competition against Getty. Both, however, have very different contributors’ agreements that might forbid them to proceed the same way.

Either way, as long as Getty does not monetize this, it will probably have little to no effect on the marketplace since, the way it is set up, it is not useful for fortune 500’s of publishing. However, Getty could easily come out with a pro version that will. If anything, Getty’s announcement might give Shutterstock’s stock a beating in trading for a few days.

The photo licensing world as we know it is not going to die because of this, at least not yet. Embedding images is a cumbersome process and Getty has voluntarily not made it easier. Unlike with video, it is not a necessary step with photos. Without any incentive, beside posting legal images – which, as we have seen, is not an incentive – it offers no real benefits for users. Adoption, in my experience ( We had offered this model years ago in a photo agency I used to run), will be low and small.

The big unknown here is how Getty contributors will react. Obviously, they will not see a penny for a while on this deal and some might get very upset that their images are being offered for free. There will certainly be a backlash that Getty certainly anticipates and are ready to handle. Their strategy here might be that they do not care if they leave ( after all, those are the images that do not sell well) or that they have nowhere else to go.

 Image licensing finally enters the XXI century:

Getty’s move, while seemingly bold, is in a fact, a natural evolution. The old method of image licensing, exchanging a penny against a file, is dying because it doesn’t respond to market needs anymore. Everyone is a publisher today and everyone needs pictures. Denying them access to your library because of cost, or complicated licensing format, is not a successful approach. What you want is to give them the easiest tools possible for them to use your images easily and then reap the benefits. Facilitate usage first, collect revenue second. Because everything online can scale massively rapidly, even if each image brings a few pennies, it can add up to a large amount. And if you can keep cost low by automating, you have a winning proposition.

It is also natural for Getty to get access to usage data. Today photo licensing companies can only analyze buying patterns. Who buys what images. They are blind as far as how their images are used, and most importantly, how viewers react to them. Which, if you think of it, should be their number one concern. Collecting and analyzing that data in order to create a more calibrated offering is what a modern photo-licensing company should be doing. And what Getty is going after.

Share Button
Posted in: celebrity, commercial stock, copyright, corbis, editorial, finance, getty, license, magazine, photojournalism, Royalty free, Snapchat, Social Media, technology, transaction, Tweet

35 Thoughts on “Getty Image’s Gamble”

  1. Pingback: Getty Image’s Gamble | Thoughts of a Bohe...

  2. Pingback: Getty Image’s Gamble | Livres photo | Sco...

  3. Pingback: Getty Images Releases a Free Option and Creates a Strategic Option

Post Navigation