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Getty Slashes Prices for Web Use
Posted By Jim Pickerell On August 28, 2007 @ 10:00 pm In Stock Art and Photography | 1 Comment
Getty Images has announced a new Web-use price of $49 for a 500k 72DPI file of any of its images, regardless of brand or pricing model. This fee entitles the purchaser rights to use any selected RM image on any commercial or editorial Web site, e-mail, mobile devices or multimedia project for one year. RR buyers get the same rights for up to 10 years and rights to use an RF image in perpetuity. This is a major reduction from Getty’s RM prices in January 2007.
At the end of 2005, Getty CEO Jonathan Klein indicated that about 10 percent, or roughly 60,000, of Getty’s total RM licenses were for Web use. Sources indicated at the end of 2006 that this percentage had grown to 15 percent or more. It is possible that much of the 9,000 image drop year-over-year in the reported number of RM images licensed in the last quarter was due to a fall-off in Web usage. The company has never given any indications of the number of RF licenses that were for the smallest file size, which might be an indication that the image was used on the Web.
Getty believes this new low price will help it capture a portion of the market that might otherwise go to competitors, particularly microstock. But microstock images of this file size license for between $1 and $2.
A few figures are worth contemplating. At a minimum price of $315 per usage, 60,000 RM images would represent $18.9 million, and in theory, many of the images used on the Web were priced at a much higher figure. That same number selling for $49 equals $2.9 million or a $16 million loss in revenue. To stay even, Getty would need to license rights to 385,714 at the $49 figure.
We know that many Web design firms have budgeted $50 per image as the price they feel they can afford to pay. Conversely, it is hard to understand why firms that can get satisfactory images for $2 or less would be willing to pay $49.
At $2 per image, customers would need to purchase 9,450,000 images to generate $18.9 million. Yet, we know that iStockphoto will license rights to between 16 million and 18 million images this year, and their number may be no more than 30 percent of total microstock images licensed. Thus, it may be possible for Getty to generate enough volume at $49 per image to offset the losses from the significantly lower price.
Getty told image suppliers that soon it will begin a significant promotional push to announce this new price to existing customers and prospects. This promotion will consist of a landing page, paid Internet search campaign, outbound e-mail campaign and Web site merchandising. RF is already e-commerce enabled and it expects to have RR and RM e-commerce enabled by the end of September.
Image suppliers should find it easy to gauge the success of this initiative by watching their sales reports and comparing the volume of units licensed with previous orders. In most cases, photographers’ royalties for such uses will be from under $10 to a maximum of about $20. The royalties paid to image partners will be somewhat less.
[tags]Getty Images, stock photography, Jim Pickerell[/tags]
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