It sometimes is a bit charming how people compartmentalize their logical facilities, using them selectively to justify emotion-based conclusions. We all smile and shake our heads at a wealth of stories that highlight inconsistencies in the human decision-making process.
Consider the traveller who refuses a flight insurance policy from one vendor, but buys a similar policy from another company that frames it as insurance against a terrorist attack.
(If you don’t think this happens, search Google under “selling travel insurance against terrorist attacks.” Clearly this pitch works and companies are using it.)
In our daily lives, such inconsistencies make us chuckle. They mostly are harmless and point to our basic, yet very complex, human nature.
In business, however, living with logical blinders can be financially disastrous.
Watching businesses stagnate or people lose their incomes is not charming under any circumstances. It can maddening when the problem is caused by those who recognize the obvious in one set of circumstances, but remain oblivious to it under other conditions that are, perhaps, closer to home.
The Return of Orphan Works
We were reminded of this while posting a story about the possible revival of “orphan works”  legislation in the U.S. Congress. Scuttlebutt has it that a new orphan works bill will be introduced this spring .
Congress originally considered orphan works in 2006. The bill mercifully died in committee. The legislation would have made it easy to use copyrighted works when the copyright owner is unknown or cannot be found.
Many of us, including photographers, illustrators and stock photography distributors, were indignant.
To be clear, we worried little about publishers and others using real orphan works. Much wonderful material remains hidden because editors fear legal reprisals if copyright owners surface after publication.
We feared instead that unscrupulous image users would employ the proposed law to turn professionally produced images into legal orphans by executing superficial searches for copyright owners. Copyright infringement was already rampant. The infringers did not need another tool to thwart a hard-to-enforce legal protection.
In other words, had the law passed, we worried that the word “orphan” would no longer be defined as one abandoned by a parent. Instead, an “orphan” could be one who loses legal protections because a parent was not immediately available at some arbitrary moment.
Royalty-Free Images: The Real Orphans
But, if we were so deeply concerned about the loss of copyright protections under the proposed law, why were we not equally concerned about losing the same protections as a function of the way we do business? Every day many of us throw away copyright protections of vast numbers of stock images, sometimes without so much as a second thought.
We call these virtual orphans “royalty-free images.”
Because royalty-free licenses are almost unlimited and because no one collects end-user information, determining the legality of any royalty-free usage is impossible. If you don’t know that someone broke the law, you can’t sue them.
As would be the case with legislated orphan works, “royalty-free orphan works” have no meaningful copyright protection.
This means the photographic industries almost certainly lose huge sums of money to infringement of royalty-free images every year. The evidence is overwhelming.
We know, for example, that many royalty-free images are re-used. A small 2005 survey by consultant Joe LaCugna indicated that a third of surveyed image-users re-use images most of the time and 70 percent re-use them at least occasionally. Royalty-free licenses allow for re-use by the original buyer, but LaCugna speculated that many re-uses were probably infringements.
We know also that purchasers of royalty-free images often pass the product on to non-paying image users. We have heard creatives brag about this, knowing they could not be sued because of non-existent record-keeping by distributors.
Most importantly, we know many infringers routinely swipe images directly from distributors’ websites. In this digital age, grabbing a stock image without paying is child’s play.
PicScout , which employs image recognition technology to find illegal usage, has suggested the vast majority of images on the Internet infringe.
To be clear, PicScout searches for rights-managed images only. Distributors keep careful usage records for rights-managed images. When PicScout finds a rights-managed image, the distributor can determine if the user has an appropriate license.
However, no evidence suggests that royalty-free imagery is stolen less often than rights-managed imagery. Since it is almost impossible to track royalty-free theft, it seems likely these images are targeted by many infringers.
Will Distributors Ever Get It?
The point is that legislated orphan works might be a significant problem. But “royalty-free orphan works” probably do considerably more harm. More than any other product, royalty-free imagery has fostered the existence of a shadow stock photo industry of unknown, but probably enormous proportions. The total value of illegal uses of “royalty-free orphan works” could equal or even surpass what photographers and distributors collect from honest buyers.
But even as Getty Images sells itself to private equity  rather than watch Wall Street pummel its stock price further; even as Corbis buys Veer because Corbis’ own sales are flat; even as the entire industry suffers years of zero sales growth, many veterans defend the current royalty-free licensing model as a success. Few seem to question the wisdom of feeding the shadow stock industry with a product that makes a joke out of copyright protections. Few notice that the legitimate stock photo industry stopped growing at the very moment that image usage exploded.
And the truly sad thing is that re-establishing some control would be fairly easy. If royalty-free images were licensed for use by a single end-user and if distributors collected the name of that end-user, then sellers could employ digital watermarking and services like PicScout to find infringers and make them pay.
How bad must things get before the stock photography industry realizes it is its own worst enemy?
[tags]photography business, stock photography, royalty-free[/tags]