Stanley Rowin: A Contrarian's View of the Photo Business - Part 3 of 5
By Stanley Rowin, © 2011 Stanley Rowin - All Rights Reserved
No matter how hard we professional photographers fought, when the clock ticked into the 21st Century, our old business models started to fall apart. We fought against, and were unprepared for, the onslaught of micro-stock, pro-am digital cameras operated by talented amateurs and the resulting commoditization of photography. It's not that the value of the image is reduced. In fact photography is valued more now than ever. It's just that the majority of people needing photos now don't want to pay what we pros once charged for them. The "download it free" mentality spilled over from music to photos. The music industry's business models eventually evolved, but new, profitable e-commerce solutions never developed for photographers.
This had a minimal effect on high-end advertising and editorial work. And if you are in the top 15% of the industry, you probably can continue to get premium pricing for your work.
But 85% of us seem to be dealing with new pricing models that we are unprepared for. Formerly we were able to license images by asking the client to prepay a fee based on the difficulty of the shot and the circulation of a printed page, whether or not anyone actually saw the page.
When paper started to disappear and electronic communication took over, that pricing model met resistance. Now clients are asking to pay a percentage of what we previously asked for, because there are no current royalty guidelines for online use of imagery. Actually there were pricing guidelines for stock imagery, before iStockPhoto changed that world. There are new royalty arrangements being developed in the music, movie and video businesses, but none for the photography business.
The middle-of-the-curve photographers have new issues that we haven't had to deal with before. An overabundance of people trying to get their photography published, easier ways to publish photos, photo buyers inundated with imagery, and reduced income per picture, to name just a few.
So how should photographers market themselves now? The same as before: with unique images of high quality. But how do they get those images seen through the clutter? And what type of client will pay a premium for quality, and which are paying for just "good enough?"
That's in my next post.
A note from the Shakodo Team: This is the third of five posts by Stanley Rowin, the third guest blogger in our series of industry experts sharing valuable advice with the photographers community.
About Stanley Rowin: Stanley Rowin has been a freelance photographer since 1980. He has a B.S. in Interdisciplinary Engineering and a Masters in Business Administration. Originally from New York City, he currently resides in the suburbs of Boston, Massachusetts, USA.
He photographed for magazines as far ranging as GLAMOUR and SCIENTIFIC AMERICAN, with countless trade and consumer magazines in the middle. He has done advertising and annual reports for companies as diverse as StrideRite and Reebok, to Verizon and Microsoft.
As two-term past president of the American Society of Media Photographers (ASMP) he was vocal on the plusses and minuses of the new digital revolution for professional photographers. He was invited to China as a guest of the Chinese Photographers Association to lecture on the economics of the digital revolution to Chinese photographers. And in 2004 he received the Professional Photographer Leadership Awards from the International Photographic Council at a ceremony at the United Nations.
When he's not out photographing, he's wondering why he's not out photographing.
Stanley Rowin's Portfolio:
http://www.stanstudio.com
9 Comments
I think that the music business is still hunting for a workable business model... And it's worth noting that a very small percentage of music revenues go to the actual artist! Television is also endangered -- too many channels split the ad revenue too thin. Newspapers are almost gone, and magazines aren't far behind. Almost anything that has been commoditized, or is moving towards commoditization, is threatened, and that includes a lot of well-paying, traditional assembly jobs. Jobs that don't require specialized knowledge or skill are moving offshore or being automated. The only jobs that will remain are those for people who go well beyond the mechanics of the job. This is also true of photographers. Even the "best of the best" have taken to writing books, leading tours, and teaching seminars, because those are the situations in which their skills and their personality shine. Of course, they still take awesome pictures, but they create stronger demand by becoming a "personality." Bottomline: "awesome" is now the minimum requirement, and that requires a whole package: personality, psychology, imagination, superb technical skill, patience, location, marketing, etc. By itself, being a great photographer doesn't even make the cut.
Rog
commented January 14, 2011
Roger Loeb
Semi-Professional
Your comments is a great addition to Stanleys article and so true! Voted up!
commented January 14, 2011
Juergen Specht
Shakodo Staff
Well put Roger!
I do get aggravated sometimes, A client will ask why I charge what I charge, When Uncle Harry just bought a 16MP camera for only $200.00 an it takes beautiful pictures Or seeing Framed Fine Art Photos in big box stores selling cheaper then I could even frame one of my own for not including the cost to have it printed and my time doing it.
commented January 14, 2011
John Germain
Professional
Hi Rog,
I agree with most of what you say. But thanks to astronomical iPad sales, smart publications are redefining their business model for mobile electronic delivery. Some newspapers and magazines are revitalizing their brands, thanks to the iPad
The music industry always had the music distributors and record companies making more money than the artists. But they also are redefining themselves using iTunes as a new revenue stream. iTunes shows us that people would rather pay 99¢ than steal music.
Here’s my problem. There are visionaries in these industries that understood the future and built these new business models.
When the pro-photo community was confronted with a similar future, most of our leaders had one reaction: “Just Say No” (JSN) to change. We were told not to change our business models. Not to embrace micro-stock. Turn down assignments where you had to give up more electronic rights with little additional compensation. Whether or not it was correct to push JSN, almost no one was working on alternative business models if JSN failed. And that’s apparently where we are now.
Actually there were some working on alternatives. Ten years ago a small group of photographers did research into the music industry model. You can read their plan “A Proposal for Independent Creators” starting on page 13 of the April 2001 ASMP Bulletin here: http://bit.ly/hw4gls
In the music industry, most creators sign their rights over to third parties, who then negotiate, preserve and protect the rights and royalties for the musician. We’ve been told for so many years never to give up our copyright that most people couldn’t get to step one. Step two was even more difficult: getting everyone to agree.
This profession lacks a Steve Jobs visionary that can harness new i-Solutions to our ongoing struggles. As you note, plenty of people willing to teach, not enough working on new solutions.
commented January 15, 2011
Stanley Rowin
Professional
Interesting link - the closest organization to what is described (that I have found) is: http://www.creativeeyecoop.com/ - the organization includes the Mira stock agency - it is not clear what level of benefit this particular business model provides to 'members' (since, if I read correctly, all income is shared?) but it does appear to be some level of response to the idea from ASMP bulletin (start-up dates to the same year.) The small portion of the site that I visited seems to be a bit aged (no/little changes since ~2005).
Overall, the idea of 'entity managed licensing' does have some appeal - for instance, I know that I can quickly, simply both research and pay a reasonable fee for xx number of copies (uses) of any covered piece of music. Of course, the notion that all images are the same is a bit tougher...
:)
Dale
commented January 15, 2011
Dale Reagan
Professional
Interesting perspective (about needing a visionary to pioneer the business model). If there were a business model such as your describe, it would partition the market into two levels: national/international and local/regional. Then I realized that such a partition effectively already exists. There are photographers (such as you) who make a substantial portion of their living from assignments from various publications, corporations, etc. But there is a much larger group of photographers who make almost all of their living shooting portraits, sports, graduation pictures, corporate PR, etc. on a primarily local basis. These are very different businesses, and the tactics for success differ, too.
In the music analogy, there are a few "big name headliners" who make the big bucks, but there are many, many more very competent, creative musicians playing neighborhood bars, nightclubs, parties, school dances, and similar venues. And a lot, perhaps most, of those have "day jobs." A particular aspect of this system is that the market will only support a limited number of stars at any one time, and the process of discovery is terribly random and largely controlled by a few "starmakers." For certain musical genres, being in Nashville is critical. If you're not willing to make the commitment and move to Nashville, the odds are very much against you. Other genres have their home bases.
Something similar applies to photography. Having a "star" mentor is extremely valuable, and starting out somewhere in the Washington-Boston corridor is an advantage if editorial photography is your passion. (Perhaps because "if you can make it there, you can make it anywhere.") That's about as far as I want to push the analogy...
Your commentary really opened up my thinking, although I'm not quite sure how to act on those thoughts.
Rog
commented January 15, 2011
Roger Loeb
Semi-Professional
I am in the lucky position to have seen Stanleys 5 part series in advance, and I agree with you, Rog, that it "really opened up my thinking, although I'm not quite sure how to act on those thoughts." :)
Monday we reveal #4 of his series, lets see where this leads us!
commented January 16, 2011
Juergen Specht
Shakodo Staff
Roger: "If there were a business model such as your describe, it would partition the market into two levels: national/international and local/regional."
As you say the market is segmented. The local portrait/wedding photographer has a slightly different business model and ecosystem. It's somewhat easier for them to "brand" themselves locally. Social media is helping the local retail photographer create a brand among local retail customers. Competition is also against the family member or friend who will shoot the wedding for free. It's difficult to compete against free.
National, big budget assignments had fees where travel costs were not relevant. Talent was. But with declining budgets, less well known, local photographers can take advantage of search engines to get that unique local shot for a distant client. Clients with big budgets did not generally risk their reputations on unknown talent. But then came "crowd-sourcing" of images and entire ad campaigns, which is changing some rules. The medium and low budget local assignment is affected the most.
Looking at the music analogy, there might be solutions, but they might be complex and require wholesale rethinking of our licensing process. And because of international laws, a solution in the US, might not work everywhere.
There are the concepts of compulsory and statutory licensing of images, and copyright collectives. In some European countries, these collectives collect publication royalties owed to photographers (see http://www.ifrro.org ). They collect royalties even for photographers residing outside of Europe. Royalties based on European usage, collected by copyright collectives, which can't find their way to American photographers, are big sums. They eventually get funneled to American organizations like ASMP and APA to spend. I believe they are currently spending most of these orphaned royalties on educational programs (check with them for details), which is fine, but there is little evidence that these programs actually help the long term survival of the industry. They could be spending it on researching new revenue streams, like copyright collectives.
There are other new potential sources of new revenue streams, but they will require work to get the ball rolling. In the almost all volunteer army that photographers have, it's hard to cut through the inertia.
commented January 16, 2011
Stanley Rowin
Professional