Sunday, 22 March 2009

Alamy and the subscription feed...

Alamy Contributor blog

UK newspaper revenue declining rapidly

UK newspapers - message 2

Clarification regarding RM images and UK newspapers

The management of the Alamy portal have been busy this week again, and regrettably once again demonstrated that they are not as in touch with their contributing photographers s they would like to be.

James West the youthful and go getting CEO of the portal made an announcement at the end of the working day on the 18th March telling his suppliers (the contributing photographers),

“We have seen some dramatic declines with some of our newspaper customers this quarter, ranging from 30% to 70% down year on year. I would like to share some thoughts with you on how we can reverse this trend.”

As it turns out (as one reads on) not so much sharing thoughts as advising that Alamy are now going to supply newspapers via a subscription feed:

“Broadly speaking any subscription offering needs to be priced at or below the total expenditure for the previous year for an unlimited number of downloads. Wherever possible we will allocate revenue to contributors based on usage, but in some cases we may have to divide up the revenue based on downloads. It is hard to judge in advance what impact this will have on the average price per image for this market. At one end of the scale prices will remain at or slightly below 2008 prices, whereas at the other end prices might fall by up to 50% or perhaps even more. My expectation is that we will see a mixture of both.”

As can be imagined the contributing photographers to the Alamy portal were less than impressed. What James did not make clear was that the subscription model is great for the newspaper – fixed costs and cheap imagery – a front page splash cost the same as a 1” square headshot on page 34, and the more they use the cheaper theses pics become. Alamy is doing this so James tells us:

“Alamy is the only large supplier of imagery not offering a subscription scheme to newspapers and we are being squeezed out of this market by offerings from our largest competitors.”

What James omits is the affect on photographer returns. Some of the larger agencies already run these feeds to newspapers, and the returns to photographers are as low as pence per use. These are the competitors that James wants Alamy to run against head to head, and match their pricing presumably.

Photographer Homer Sykes says on the Alamy Blog.

“At Getty when they were selling my work on subscription (without my permission) I was getting as little as $2.57 per image. I have now removed my images and or had them ring fenced in their so-called Premium Archive. Getty still sell images from those ring fenced premium archives to UK newspapers, and no longer am I receiving MicroPayments. UK newspapers will pay for quality. And if they don't, then just forget them. Its an insult to be paid so little for so much.”

Perhaps it would help if we looked at how we got here?

Alamy came out of nowhere at the turn of the century, and has filled a gap in the agency/photolibrary market which has proven very useful for the average editorial professional photographer.

The digital revolution has affected photography both professional and amateur in many ways – some good - some perhaps less so.

In the late 1990s it was clear to many photojournalists where the market was going. Digital imaging was here to stay and was rapidly becoming the new standard, and although there was a transition period when scanned negative material was superior to digital sourced work, cameras were gradually getting better and better.

Many professionals, myself included, were waiting for the affordable camera that would combine the apparent ease and convenience of digital working (the speed with which we could get single images to our newspaper clients was impressive), with the quality that we needed for our non-newspaper client. You can get away with a lot in a black and white 72 dpi image only taking up two or three columns that simply wouldn’t wash with a double page spread in a

glossy magazine.

The first camera that really showed the way was the Nikon D1 (2.7 mega-pixels – 7MB file size). Almost laughable by todays standards, but just about acceptable for most of us back then. By 2003 we were seeing cameras with 6 mega-pixels as standard - 18Mb file size, and these were perfectly capable of servicing the most demanding standard editorial requirements. 6 Mega-pixels was the same standard that the Kodak RFS 2035 film scanner had that cost something like £7,000 in the early 1990s. (I still have one – totally useless to me now of course.

Libraries were in a real quandary. The writing was on the wall. Some saw the future and started scanning their best images like crazy, to build up a quality digital library, others felt that the quality was not there (it wasn’t in 1999), so steadfastly refused to change or adapt, believing that the ultimate quality of transparency film stock would win out.

Well we now know who was right don’t we? Many great agency names of the past simply don’t exist. They either withered away and died, or were bought up by larger concerns, many of those in turn bought up by the giants – Corbis, Getty, Reuters and the Press Association (PA)

Many of the specialists have gone. When I was working as a sports photographer, running my own agency in the 80s and 90s my main competitors within my own speciality of rugby union were seen to be Allsport, Empics and to a lesser degree Action Images. All much bigger concerns than mine, but within my chosen niche our businesses were closer than overall

turnover and number of employees would have suggested. All these agencies have now gone, including my own. Getty bought Allsport, PA - Empics, and Reuters - Action Images. Smaller agencies all over the UK of which there were a great many have simply disappeared.

There are still a few specialists around, mostly dealing with niche subjects, and keen hardworking photographers are still supplying them. However, newspapers as clients have been on a downward spiral ever since the 1980s. As both employers of photographers and users of imagery they have been contracting. Newspapers that boasted 50 (some even more) staffers in 1985, as well as a similar number or more contract freelances, and probably double these

combined figures of allied freelances, now have work for less than 20 regulars, of whom, maybe five will be staff and slightly more on contract.

The work that these many photographers were supplying in the eighties is now, where images are still required, taken from the PA subscription feed, and to a lesser extent from Getty and Reuters feeds as well. These subscriptions feed are basically a fixed price service, where the paper takes whatever it needs from what is made available. Great for the newspaper – known and fixed relatively low price. Great for the Agency, as there is a guaranteed income. Flip side is those freelances caught in supplying the feeds get virtually nothing for images that before the feeds were paying minimums of £50 or £60 and much more for larger sizes and important subject matter.

As pagination decreases, quality declines, the advertising revenue falls away. With less advertising revenue, the cycle continues with pagination dropping, quality falling through the floor, more staff made redundant, fewer freelance contributions required, and lower prices paid, which leads to even lower quality products, which means less adverting…

It is in this climate that Alamy find their income from Newspapers under threat, and falling away, as James intimates monthly.

So what can Alamy do, what should photographers do?

Alamys knee-jerk reaction answer is to attempt to compete with the others already firmly entrenched in providing a subscription feed such as Getty. That is to say the newspaper client pays an agreed fee per period to the agency (Alamy) for a set number of downloads, even unlimited, depending on the agreement. The images are supposed to be taken for immediate use, shouldn’t be stored for any long period and will be available for use in the agreed products. The agreed fee is set, usually low, but means the publication gets cheap imagery for a known fee, and the agency at least knows that it has a guaranteed income. So what is wrong with subscriptions if two of the three parties involved get an acceptable deal?

As is often the case these days it is the original supplier, the creator, the photographer, who loses out. Unique material that may have taken a lot of time and effort to produce is sold for a pittance. A 100 square inch picture on a front cover sells for exactly the same as a one-column headshot on page 34.

Photographers supplying the agencies that Alamy is pitting itself against, who already get sales through the newspaper subscription feed, are reporting extremely poor rates, as little as 54 pence per use.

This is a sample of what one photographer showed me from a recent statement – all these are newspaper subscription payments:

What possible incentive is there for any photographer, who sees his or her work that should be selling for a £60.00 minimum, virtually given away? Many micro sites would pay better than this!

Alamy need to remember what their USP is.

James told us this week:

“most of our customers want us to succeed because they like the speed, simplicity, and choice on Alamy”

“Alamy has a better selection to offer than our competitors.”

“Alamy is already one of the leading suppliers of stock imagery to the UK newspaper market. Alamy’s share of overall usage will likely increase if we do some deals, but not by a huge amount.”

“Most newspapers are reducing the number of pages they print and are moderating their online ambitions due to budget constraints. I don’t envisage that picture usage volumes in UK newspapers will increase significantly over the next couple of years. If anything, they will reduce.”

Chasing reducing returns is plain daft, and does not make economic sense. If the market is reducing, to chase reducing revenues, revenues that you know are getting smaller, by reducing your price is clearly insane. Alamy need to hold its ground. Be the leading supplier. Emphasise and build on the speed, simplicity, and choice on Alamy. Foremost though don’t try and prop up businesses you know are failing. Look for new markets to replace the ones you know you have already lost.

On a positive note, with Alamy introducing a subscription feed, for those who choose to opt out of the scheme, (that will be everyone who understands the math), this could prove to be a boost in income. The newspapers already buy from Alamy because it has material they can’t get easily elsewhere, despite the fact that some agencies supply by subscription feed. So if a newspaper really wants an image they will not be able to get on the subscription feed, they will be forced to either purchase it properly from Alamy as they do now, or better still, have to source the image direct from the photographer and pay the proper rate, as set by the creator.

One sale at a realistic rate could well be worth more than a hundred sales at 54 pence!

(c) 2009 Pete Jenkins

1 comment:

  1. Pete,

    You are absolutely right, of course. Because of its 15 + million images Alamy will earn some useful money, whereas photographers images will have been devalued to the point where their earnings from newspapers will be a joke.

    There is a further issue if the paper holding Alamy images is sold, and we know the state of the current newspaper industry. This is that once an image is in a newspapers files it is likely to become the property of the new owner, in this way most probably becoming an unidentified image that in effect will become an orphan work. I have on two occasions had to threaten companies with legal action when they used images of mine that had been acquired when a company holding them had been acquired by a third party.

    I have told James West, of Alamy, that I will remove my images if he does the kind of deal with newspapers that he is proposing.

    Brian Seed, Chicago,