In this post from last week (earlier similar here) Alamy explains their statement on the new Alamy Premium Account and writes "We can cannibalise microstock market share at a much higher price point". I won´t go into more details, the use of images in advertisement (Microstock) or not (Alamy Premium), virtually unlimited usage, etc. - I just don´t believe in the basic principles of this opinion, hardly based on serious calculations.
Alamy refused to publish further Quarterly Statements after their final public Q4/2009 Statement in early 2010, and that´s not because their revenues went through the roof. "Cannbalise": Alamy used to generate roughly 1/30 in yearly revenues of what the total microstock industry generates in revenues per year. Ray William Johnson can´t compete with that.
News about yet another newly achieved millions-of-images-count-milestone appeared from most of the well-known microstock agencies in 2009 about every second month. So generally no big thing.
But now for the first time it´s up to numbers with eight figures. Though already an old number a day later, Shutterstock, the inventor of the subscription model and as the first of the Big Four* microstock agencies, completed yesterday shortly before midnight local time NY its next milestone of 10,000,000 microstock subscripton images.
As known all over the place, the absolute number of images can, but must not necessarily be connected to the financial success of a microstock agency: iStockphoto currently shows roughly 6,3 million, Dreamstime 7,7 million and Fotolia 7,4 million - the latter surprising because Fotolia announced 8 million images two month ago in December 2009.
(Screenshot exclusively and courtesy of Shutterstock)
*I have excluded microstock newcomers like PixMac which predominantly
distributes external content from Fotolia and Dreamstime and reaches
10,185,000 images this way.
Update Feb. 16, 2010:
Fotolia´s image-/file count: So while on the topic whether or not Fotolia shows 8 million image files, Fotolia´s EVP NA Garth Johnson added: "Our count is over 8 million now. We separate the Photos and
Illustrations from both Vectors and Videos." "All together, we have well
over the 8 million mark."
We are sorry to announce that beginning today, StockXpert will no longer sell new credits or accept new members. On February 11, 2010, searching and downloading at StockXpert will cease. This will be the end of image sales at StockXpert.
All SXP members have the opportunity to transfer their remaining credits to iStockphoto. iStock offers the highest quality affordable microstock imagery in the industry. Come and see for yourself. SXP credits will be honored 1 for 1 at iStockphoto.
Changes at Veer Marketplace: Veer Marketplace content will now be front and center in our search results, along with RF content Veer has from macro photographers and partners. We will streamline our web site so that there is a single search grid (rather than the two separate RM/RF and VMP grids that we currently have). [...] We will simplify the customer experience on Veer by only offering easy-to-license RF imagery, including all the imagery from our Veer Marketplace contributors. We will continue to have a wide variety of images from premium-priced images to value-priced images, all offered under the RF licensing model. Translated: RM will be removed from Veer.
New increased credit prices at Dreamstime. As much as most contributors are understandably delighted, some see things different: Any news about an increase in commissions is good news, however I also feel that Dreamstime should put some effort into their marketing of the site to try and get themselves up there along with iS, SS and FT. They need to be seen to be actively promoting the site in order to get the volume of sales to make it worth while staying. If Dreamstime don't market themselves properly a price rise is pointless. (abbreviated) Related: • Dreamstime adjusts Royalties and Pricing (Aug. 14, 2008)
What´s new at iStockphoto in 2010 here and here? Regardless of the new tiered collections, changed prices in some cases ("iStock’s largest files were too expensive") and the ongoing fight with other people in Calgary about exclusive contributors: "We now sell three times as many files as we did back in 2006 ... What´s even more amazing is the average number of downloads per contributor has also risen significantly since 2006". Related: • iStockphoto: New pricing, a new premiere collection and more changes (Dec. 10, 2008)
New programs need to be disruptive in order to compete with core models:
It's the first time we had to remove a product since our inception, 5 years ago. No matter how difficult is to withdraw features that required a lot of work, I consider such move wiser than supporting a program that proved neither able to compete with our core model nor able to help it grow. Dreamstime´s Serban Enache indirectly on the sometimes ambiguous difference between managers and leaders when admitting mistakes: one man, one word, that´s it. Worth reading. Background here and here.
Acquire another credit-based micro agency which additionally doesn´t offer a subscription plan: more details.
Read Jon´s announcement here on the SS forum: "Though we studied the possibility of building a credit site from scratch, in the end we decided that acquiring and building upon the momentum of a solid brand like BigStockPhoto.
What we did with subscriptions - we plan to do with credits".
Pricing - Because each logo will only be sold once, they have a higher price-point, ranging from 100 - 750 credits. When designers upload a file, they will set a recommended price and our inspectors will then make the final pricing decision based on that recommendation.
Royalties - iStock will pay a base royalty rate of 50% per logo design for the first 6 months. We’ll give advanced notice for the rate going forward after that.
"Similar on getting married, trust someone after the long run not on your first date" (on page five here). In a move long expected and with respect to the highly competitive market long, long overdue, Dreamstime has revamped its royalty and pricing structure with some interesting details.
While some contribitors usually have ambivalent feelings anywhere about these changes ("credit royalties will decrease"), the "repositioning" enables DT "to attract more buyers with the extra budget": "for 5 years we've kept a royalty of 50% for all non exclusives against 20% which was the minimum of the industry. The agency awarding you 20% had bigger prices than us and lower commissions. Which means better budgets to drive traffic."
Prices start higher at Fotolia with €249/month for 25 images/day (Shutterstock: €199), but align with a 12-months subscription (FT with €2.061 vs. SS with €2049). This comparison is not valid for the US where SS starts at $249/month, like Fotolia, and 12-months subscription are $2.061 (FT) vs. $2.559 (SS). Dreamstime in comparison: $239 and $2.399.
Fotolia vector and video files now count as 3 respectively 10 downloads. -More here.
Polylooks operates with credits. Photographers receive 50% commission for exclusive and 35% for non-exclusive content. The pricelist for photobuyers gives an overview about the price tags for single images and subscription images. The website is currently only available in German.
Partner of the new microstock community is Hamburg-based mid-/microstock agency Zoonar which contributes around 150,000 images to the new portal.
Some competitors of Fotolia have taken pride in the past months to spread the rumor that Fotolia was already or was about to be sold at that time.
TechCrunch/Erick Schonfeld, in another new article on Fotolia - and no further comment from me - emphasizes that "Fotolia Takes A Massive $50 Million To $100 Million Round" from TA Assiociates, but mentions also "there are some rumors going around in venture circles that Fotolia got sold outright for $150 million. Our source, however, emphasizes that the company was not sold. Instead, after competitive bidding from more traditional venture firms, TA Associates came in with a massive injection of capital."
Now you take your calculator and assess:
The underlying company evaluation, and
The underlying estimation of the microstock image market size.
Lor’s ambitions are to have close to a million photos available free of charge and PhotoXpress will remain independent from sister site Fotolia, however the two are intricately connected. PhotoXpress members will be able to license up to 10 images daily, free of cost.
Professional ad agencies and firms who might need more than 10 images a day will be sent to Fotolia. In this sense, PhotoXpress is a lead generator for Fotolia. But more than that, it is a way for professional photographers to expose some of their work for free to a larger Web audience, while inculcating a respect for copyrights among Web consumers. It is an attempt to bridge the two worlds, and Fotolia wanted to do this before its competitors did.
Lor says the biggest challenge is convincing the photography world to give away stock photography for free. PhotoXpress is still working out if the site will make any revenue - the obvious revenue stream is third-party advertising on the site, but Lor couldn't confirm or deny that there will be ads on the site. PhotoXpress's main competitor is Hungarian site Stock.xchange.
A sudden surprise before our CEPIC session on free images. -Check the license agreement (e.g. "limited to a resolution of 640 x 480 pixels in website uses") and check with your wife before using some partly strange stuff over there (1; 2; 3 and 4; initial keyword: beach).
Hamburg-based mid-/microstock agency Zoonar has sent out emails to photographers stating that Zoonar is supporting the Deutsche Telekom/German Telecom regarding the launch of a new image portal run by Deutsche Telekom, including a microstock agency, a photo community and an online magazine for photography ("Augenblicke").
The new image portal will apparently launch by the end of May and pay photographers a 35% commission.
iStockphoto Subscription Update by Kelly Thompson: We hear you and understand you aren't happy with the royalty percentage. We'll see what we can do, but don't expect miracles. [...] Subscription on iStock is not good enough. Photos.com is our best opportunity at creating a competitive subscription site, and you should want to be involved. [...] All that being said, it's probably going to be next week before we get back to you. Given the reception, the most likely outcome will be for us to look for alternative sources of images for Photos.com/JIU. Over 400 replies currently on over 20 pages. A comment* by RapidEye:
Patrick Lor, co-founder of iStockphoto, a Getty owned-online marketplace for microstock photography and video, has joined rival Fotolia as the President of Fotolia North America. According to Lor, his non-compete contract expired with Getty recently, which left him available to get back into the stock photography business. iStockphoto was initially launched to democratize photography and let all people use images, Lor says. He was disappointed to hear of iStockphoto’s aggressive price increases following the Getty acquisition and maintains that Fotolia’s prices are much more fair for consumers. Lor hopes to launch some new services in the future but won’t reveal what those are just yet.
To be fair, please note that in threads like the two mentioned above the negative
comments of some members might prevail which might not reflect the opinion of
the majority of contributors. Also, and again to be fair, the results of the quoted and ongoing survey above might not be representative for the majority of contributors. Again, you need to read both
threads mentioned above yourself for a complete and balanced overview.
New Subscriptions Q & A on the iStockphoto forum: Quite a journey. The initial thread Subscription Shuffle (see last posting) regarding the integration into Photos.com and Jupiter Unlimited was closed after 1315 answers. Now this new thread New Subscriptions Q & A ("We want to see iStock and Getty Images take a bigger chunk of the Subscription market") was started by rogermexico and has already gathered over 400 replies. To the question "Won't that weaken our sales here at iStock?" he responds: "No. All of our research shows that the audience for these sites is different enough from our existing customer base that there won't be any kind of cannibalization. We are breaking into a new market, not re-selling to the same one." And later: "We've still got a lot to discuss internally about all of this. Obviously a reaction this strong from the community must be taken into account". Again, you need to read all the replies yourself for a complete & balanced overview.
[Update May 6th: the above mentioned thread was closed after over 1,100 replies]
The royalty paid will be 20% or 22.5% of the value of each download, which in turn is calculated by dividing the monthly value of the subscription by the number of downloads in that subscription that month (much like is currently done on iStock subscriptions, but monthly instead of daily). We’re projecting the average royalty payout to be 30¢ – 55¢—a significant upside to similar competitive subscriptions. At the high end, you could see earnings as high as $17.99 per image.
... a pretty vibrant discussion with pros (e.g. "exclusives now have a much bigger market to sell in") and - very unusual for the iStock forum - some cons (e.g. 1, 2 and 3) with currently over 600 responses on over 30+ pages appeared, also driven by questions of iStockphoto´s exclusive photographers about the remaining exclusivity of their iStock content*.