I had a rant about microstock agencies a while back in my previous blog. You should still be able to read the post here.

18 months on and my feelings haven’t changed. They’ve hardened a bit, though. What has grown is my feeling of bafflement.

Like a car, a company has four wheels to keep it on the road:
1. Its shareholders
2. Its staff
3. Its customers
4. Its suppliers

Virtually all companies share these elements. Lose one element, and it’s less stable. Lose two, and to my mind it’s distinctly wobbly.

Microstock agencies sell bulk quantities of cheap pictures. The business model is typically this: the customer pays a subscription to download a number of pictures over a period of time. A typical example is $999 to download 1,000 pictures — a dollar an image. You can then do what you will with them.

This is fine for travel companies, advertising and design agencies who just need generic shots of smiling people and sandy beaches.

What baffles me firstly is where do these agencies get their images? What intelligent photographer will upload pictures to a site where, if they get a return at all, it would be in the region of 20 cents a picture? And then they’d have to wait until they’d sold enough pictures to trigger a payment.

So that’s one wheel off the wagon. The thinking is clear: “Let’s ignore the photographers. They’re just the suppliers. We’ll make big promises and pay them peanuts.”

Yet the photographers keep on coming. They keep on sending pictures to these sites. Why do they do it? Why? Nobody likes to admit making mistakes, but why do lemmings spring irresistibly to mind?

Now the next wheel, the customers. When you sell any old picture to any old client, either you or the client can run into trouble, as this famous article in the Wall Street Journal pointed out when Met Life and Pfizer (promoting their best known product) ran ads featuring the same photograph of a happy middle aged man. Here’s the Met Life ad; the Viagra one has long been withdrawn:

That was the funniest microstock cock-up — you’d think that companies the size of those two would be prepared to spend more than a dollar a picture to get exclusivity.

Before the gent with the tiger in his tank and the life insurance policy turned up, we enjoyed Everywhere Girl, a heartwarming story of a one-off payment.

This of course is the advertising world. In book publishing, the area I know best, there are small publishers and book packagers fighting to compete with the Pearsons, Random Houses and John Wileys of this world. They don’t pay royalties, so they can’t compete through their authors. But they can buy images, and they can produce lavish, nicely designed picture books to sell to wholesalers at cripplingly low prices — typically 15% of the cover price.

The big market for these is America, and over there the prices are exactly the same as they are here, except they put a dollar sign in front of the US price and a pound sign in front of the UK price.

Because they can. Never mind that the pound is worth 2 dollars.

So a $20 book in the US, which would look like a £20 book in the UK, has to be supplied for £1.50. Out of that £1.50 has to come the cost of the images. So what do the packagers do? They go to microstock agencies.

It’s great as a temporary solution at the bottom end of the market. But the awful time has already arrived when the book buyer at Jovanovich, Scribner & Borzoi Inc. looks up, shakes his great shaggy head and points at a rival publication using exactly the same pictures from the same picture library. The market can stand only so many picture books on China and Ireland, and if the public finds the same images in different books those goddam purses are gonna slam shut.

I know of one small book packaging company sinking back exhausted onto the ropes. We tried to sell them pictures, but the director looked at me hollow-eyed and told me

“We have one member of staff doing nothing but downloading images from microstock subscription agencies, 10 hours a day, five days a week. We have a deal that allows us to download as many as we can in a month.”

Well, that was a business plan, of a sort. But I’m not sure that it worked. I didn’t see her or her company at the London Book Fair.

The only answer is exclusivity. That doesn’t come so cheap. It’s not an option in the microstock world.

Like Dutch Elm Disease, the virus is slowly killing its host. So that’s the second wheel off the wagon.

Only the staff and shareholders will be left. What will they have to share? Especially as their wheels only handle steering and direction, rather than propulsion.

Perhaps we’re seeing a tectonic shift opening up in the picture library world as decisive as the division between TV and radio, hardback and paperback, cinema and DVD, microstock and rights-managed.

Because it is now possible to buy a picture for a dollar (albeit that the small print says you only get that price if you buy $1000 worth of images to begin with) the market begins to think that that is what a picture is worth. Even publishers accustomed to paying fair prices for rights-managed imagery are coming under pressure from their bosses who have received ‘dollar a picture’ junk mails from these organisations. They realise that microstock is not the way to go if the business needs to be taken seriously, but the picture buying budgets have been cut, and cut again. One major new buyer told me:

“I am always keen to know about any new (to me) picture sources, but I must also say that we work on very tight budgets here. We tend to need to find sources where can pay £30–£40 ($60-$80) per picture whatever the size it is used at… (inside the book). For some bulk deals where we use many pictures we negotiate to pay even less – for example on the raft of big encyclopedias that we are doing at the moment, we have deals with picture sources to pay £15 ($30) per picture when we use over 600… Perhaps we could make it work in the future, but I thought I’d make you aware of just how restricted we are on budgets.”

I believe if the labourer is worthy of his toil, then he should be rewarded. I believe in royalties for intellectual creation. I don’t believe that everything created after 1923 should be in perpetual copyright. I believe that 70 years after the creator’s death is too long a protective period. I believe our photographers should earn more than $15 for a picture sale.

Maybe these are too many beliefs and not enough realism. But I realistically know the market will not carry on paying for the same old microstock stuff again and again. There’s been a huge shake up in the picture business in this century — fotoLibra was the first all digital picture library, so we were at the heart of it — and what we wanted to do was to democratise the stock agency world so everyone had the chance to sell their images.

I now want to know what drives a photographer to accept 20 cents for the sale of a picture.

We want our members to get paid pounds, not peanuts.