Monday, March 5, 2007

Thanks for the New Model!

Wired News is reporting the good news regarding public figures for what it will cost internet sites to broadcast one song to one listener. This sets a standard that we should all review and embrace as a floor for our rates and apply it to photography.

Here are their figures to stream one song to one listener:

2006: $0.0008
2007: $.0011
2008: $.0014
2009: $.0018
2010: $.0019

Yes, this means the death of many internet-only "radio stations". What these places don't reveal is that they are generating revenue from ads on their site, and ads inserted between songs and are doing so without properly compensating the music owners for the use of the content that attracts the listener in the first place.

If you're an advertiser on the cost-per-click model on Yahoo or Google Adwords, you know that you pay per click. Banner ads, and other ads pay cost-per-view. It's extremely easy to track how many times people see the ads, because the servers that hold the photo track anytime a request comes in to deliver the image.

Stan Rowin, over at Pro Photo Business Blog has an interesting take on this as well, take a gander.

Typically, the fees are "cost per thousand" (a.k.a. CPM), and, for 2006, that equates to $0.80 (eighty cents) per thousand views. This year, it's $1.10 per thousand views. Considering this, commoditizes photography, some might say, but I say it sets a floor, and for the premium images, a greater CPM should apply. Further, just as there was a 1/4 page minimum fee for usage, even when it was a thumbnail photo, so too could we establish a minimum fee tied to a minimum CPM. So, say you wanted a minimum of $25 to make an image available to a website. That would equate to about 30,000 views.

Rock on!


Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.

4 comments:

Anonymous said...

But for internet radio stations that rely on donations rather than advertising, such as radioparadise.com, this spells the end.

In addition, this seems blatantly unfair relative to traditional FM stations. Here's a quote from Bill Goldsmith of radioparadise.com:

"There has been much discussion about how unfair these rates are, but our listeners find one fact particularly apalling: while Internet stations like ours are being told they must pay royalty fees that exceed their income, sometimes by several times over, FM stations - including those owned by media conglomerates like Clear Channel - pay nothing at all!

Yes, both FM stations and Internet stations pay royalties to songwriters and/or music publishers. But the royalties in question are owed to the owners of performance copyrights, which means, in most cases, record companies - and to them, FM stations pay nothing at all."

See Save Our Internet Radio for more info.

Dan said...

The music market is absolutely the last place we want to get ideas for our industry.

The labels screw over the artists they represent, they stifle creativity, their trade organization (RIAA) sues their customers with little to no actual evidence, and finally, they are extremely slow and and resistant to change and innovation (They sued to shut down Napster in 1999 and it took them until now to embrace digital music and recognize it'll eventually replace CDs).

To top it off, they place DRM on their digital material which removes peoples fair use rights and reduces a persons ability to use what they buy.

Music has become a commodity due to the way the industry has managed it. Do we really want to model ourselves after these bastards? Do we really want to place unreasonable restrictions on our customers, sue them, turn our work into a commodity, and get screwed over in the process?

If that's what you want, go right ahead. I think there certainly a need to find a new business model, but we shouldn't model ourselves after a group that generally distrusts their customers and has no respect for the artists they represent.

John Harrington said...

Dan -
Just as with the labels, media conglomerates are screwing over editorial photographers. I'd LOVE DRM on my images, so they expire after their licensing term! Using this model as a floor, we can point to it when someone asks how we arrived at a figure. As to Anonymous' comments about the label owning the copyright and thus it's not helping the artist, that's true for the artists who sought quick success by signing copyright to the label, and only obtained leverage after the second album. Those that built buzz and went independant own all their rights.

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