Resisting a Price Reduction . . .

Stock Asylum Staff Report
Sept. 11, 2007

A group of six trade organizations that collectively represent 12,000 photographers has asked Getty Images to scrap a severe price cut for web resolution rights-managed and rights-ready stock photography.

Calling the price reductions extreme and a "huge risk to the image licensing business" the group headed by the Stock Artists Alliance (SAA), urged Getty Images to reconsider its decision to implement across the board pricing of $49 for 500 kilobyte digital files.

In a letter to Getty CEO Jonathan Klein, the group suggested that, "Offering your very best imagery at heavily discounted prices may well increase volume, but it also risks undermining Getty's core licensing business, as well as the businesses of the independent contributing photographers who create and own the majority of imagery in your RM collections."

The organizations did not ask Getty to reconsider the $49 pricing for royalty-free imagery, some of which was already priced in the $50 per image range for small digital files. In addition, the organizations acknowledged the need for simplifying the image licensing process.

SAA was joined by the American Society of Media Photographers, the Association of Photographers (AOP), Advertising Photographers of America (APA), Editorial Photographers (EP) and the Canadian Association of Photographers (CAPIC) in calling on Getty to reconsider its decision.

"What we are saying is that they've lowered the price for everyone, including those who have high budgets and are willing to pay higher prices," said SAA President Roy Hsu, who is a stock photographer and an advertising art director. Hsu has worked at a number of large advertising agencies like McCann Erickson, BBDO, and Ogilvy. He currently works for Publicis Modem and has spent ten years working in the digital end of the advertising business.

"Now (with Getty's new pricing) you are mixing up low end users who have no budget with advertisers like Fortune 500 companies," Hsu noted. "These large brands can easily spend hundreds of thousands of dollars on an ad buy. They can afford to pay more for the images."

Hsu noted also that Getty is lowering the prices for web uses at a time when advertising dollars are migrating from print and radio to the web . "They reduced the price for the fastest growing source of advertising," he said.

Getty announced the new pricing last week. The $49 price has already been implemented for royalty-free imagery, but not for rights-managed and rights-ready.

Under the proposal, buyers of royalty-free and rights-ready images have few restrictions. Rights-managed images "may be used in one commercial or editorial web site, e-mail or mobile project for one year," according to the company's web site.

The price reductions can be extreme –– as high as 96 percent for some uses, according to SAA.

The organizations opposing the $49 pricing cited five anticipated consequences resulting from the reductions, including loss of high-value digital licensing revenue, devaluation of rights-managed licensing, erosion of prices for other image uses, reduced revenue for photographers and a reduced ability to recover funds for lost or damaged original photographs or from copyright infringement cases.

"Infringements of stock images are already at crisis levels-especially for web and digital uses. We are alarmed that a consequence of the low value established for web uses will dampen efforts to enforce copyrights and recover otherwise lost revenues," the organizations asserted.

In announcing the pricing last week, Getty said it included "virtually all of its editorial and creative collections." However, a footnote on a Getty Images web page explaining the new pricing says the offer "does not include images from Image Source or Arnold Newman Collection, or select editorial images." Image Source is a royalty-free collection.

A number of photographers were shocked by the Getty announcement.

"I guess I'm just stunned that Getty Images and the Getty family, known as
patrons of the arts, the Getty Museum, etc., can be privy to what amounts to a wholesale devaluation of photography in what appears to be a desperate move to secure sales volume and give a bump to (Getty Images') share price in the last quarter 2007," said Florida photographer Larry Gatz. "I have seen estimates that sales will need to increase ten-fold to produce an equal amount of income for the photographer. That is unlikely to occur."

The Stock Artists Alliance web site is at: http://www.stockartistsalliance.org.

Getty Images is at: http://www.gettyimages.com.