Saturday, August 29, 2009

Not Out-Gunned, Devalued

Everytime I post something or read somewhere where something is written that is critical of amateur, pro-sumer, volunteer, or free photographers, whether these folks are in credentialed positions, getting a magazine cover or photo in an ad or newspaper, I hear some variation of " pros are just worried about getting out gunned...". Honestly, nothing could be further from the truth.

A pro knows the value of their work, and, as a result, the value of the effort they bring to the assignment. Product shot on white seamless? Seems simple, but it's not. What about transfer edges? Highlight shapes? Angle/perspective, and so on. This is one of a hundred examples I could provide. Case in point - I recently had a client drive a long distance to come to my studio for a product shot. At the conclusion of the shoot, he commented that he had no idea how much went into doing a shoot to get superior results. He expected it to take an hour for four products. It took seven hours (frankly, much of that time was product-build time). Afterwards he recognized what was involved, and definitely pleased with the results.

When someone sells a commodity for $10 that everyone else is selling for $100, it devalues that commodity. If the commodity was easily selling for $100, why would someone - anyone - sell it for $10?

(Continued after the Jump)

Photography is, however, not a commodity. Just because some people choose to devalue it to that point, treat it as such, price it as such, doesn't make it so.

Some organizations have chosen to price images, for example, by the pixel dimensions alone. This does not take into account so many things, it's just rediculous. The image of the hindenberg engulfed in flames or JFK being shot cannot be priced by the pixel. Doing so devalues the work because it does not take into account the content of those images.

Consider, for a moment, that an inventor created a product, and it costs that inventor $10 in materials and overhead, per product, to manufacture it. Following common business practices, that product will wholesale for $20 each. Following again common business practices, that product will retail for $40, and likely sell on the street for around $30. Understand, this is an example and these are generalizations.

With those figures in place, the company decides to spend $250,000 for ad space (online and in print) to market the product. It is to be your photograph, of the product looking so cool and so amazing, that is the entire ad, with a tag line "Buy it and be cool". As a result, the client sells 250,000 products. That means that the client spent $2.5M in raw materials, and netted $2.5M in profit. The retailer too grossed $2.5M as the middleman for the product, providing retail shelf-space. How much are you, the creative mind behind the image that convinced the buying public to actually buy, due? 1% of the profits? 5%? How about just 10% of the ad buy? What if your single image were one of four on the page, would you be due 0.25% or 1.25% of the profits, or 2.5% of the ad buy?

A photographer brings to an assignment an understanding of the subject and their quirks. Whether it's a sporting event, where you know how a particular player will likely act, a portrait where your subject has a duration they will be willing to sit for before their unhappiness at being photographed shows in their expressions, or food photography, where the concoctions that photograph like, say, ice cream, are almost inedible despite looking great through the cameras lens, all assignments have challenges. Can any given photographer stumble into a great photo? Sure. Even a blind squirrel finds a nut once in awhile. The pro however, must get it right at a level of expectation for success that approaches that of a surgeon. The problem is, unknowning clients look at the bottom line and then ascribe equality to an amateur's work and that of a seasoned professional. In the end, the client is unaware of the risks, however, the damage of devaluing photography has been done. The client will just blame the photographer when the shoot fails, not themselves for hiring the photographer without a proven track record of success.

The collateral damage of the client choosing on price, is that photographers will feel pressure from clients to lower their prices, and some will. Then there will be more pressure, and more lowering of prices. Please understand, I am not writing this as someone who has lowered their prices (I have not), but as someone who is watching as photographers' sales reports that used to show average per-image licensing of upwards of $600 now showing those same images for similar uses averaging under $100. Further, photographers who used to earn $2,500 off an original assignment and several thousand dollars in re-sales licensing over the years are now being expected to sign away all rights (and thus all future resales) for $1,000.

In the end, not only are you devaluing your work, and those of your colleagues, you are doing damage to a profession that is a passion for most in it, and you are leaving a lot of money on the table.

I know of no photographer who feels the young upstart photographer, the amateur photographer, or even the pro-sumer will "out gun" them, but almost all of the photographers I talk to about this know that these same folks are devaluing their work. Interestingly enough, that means that the pro sees quality, capability, and talent in the images produced, and knows they are worth much more than they are being given away for.

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.

[More: Full Post and Comments]

Thursday, August 27, 2009

US Presswire "Steps In It" With MLB and Getty Images

As the boys of summer were just getting into the swing of things, US Presswire hired an unemployed Peter Toriello after he was laid off from Getty four months prior where he was in charge of the Getty's MLB relationship. USPW announced Toriello's hire as "Director of Global Sales and Business Development" on March 4, 2009. What they didn't announce was that in addition to Toriello's physical capabilities, they also obtained a valuable knowledgebase of information about how Getty was handling the MLB contract. With Getty losing the NFL to the AP, the MLB deal becomes that much more important to Getty's cache. What is in question is what potential proprietary trade secrets might Toriello have taken and/or shared with US Presswire, if any?

Not surprisingly, Toriello knows the financial cycles of the MLB teams, and he also had inside knowledge of just what Getty Images was charging MLB teams for asset management services. Each team has their own collection of wholly owned content that not only do they want marketed for revenue generation (that Getty would get a piece of, of course), but also for team uses - everything from billboards to brochures. Getty had an asset management solution that was one-stop shopping for both image licensing, but also asset management.

Was it a timing coincidence then, when Toriello contacted the teams in his new role at US Presswire, and what exactly was he offering them?

(Continued after the Jump)

Rewind a few months, and let's look at Toriello's first mis-steps. He wasted no time in demonstrating his lack of business accumen by using a quote from Michael Madrid of USA Today in his marketing materials to all of the people on his e-mail list. Below is a portion of the brochure he, as as USPW's "Director of Global Sales and Business Development" sent out:
As you can see, USA Today is quoted as saying:
“Week after week we have been continually impressed with the quality of images and their dedication to posting those images as quickly as possible. More often than not, we have found USPRESSWIRE has better quality images than the AP, Reuters or AFP… We trust their news judgment and appreciate the fine quality of photographers they have brought to their team.”
-- Michael Madrid, Photo Editor
There are three problems with the above quote, even if Madrid actually said it (which remains in question). Problem #1 is that even if Madrid did say it, he did not grant permission for it, or his name to be used in an endorsement of USPW. Problem #2 is that USA Today has a very clear policy about endorsements, and doing this violated those policies. Problem #3 is that not only did Toriello/et al use the USA Today logo in their brochure, but they also used the trademarks and implied endorsements by CBS Sports, ESPN, and others, as shown below, in that same brochure:
That brochure was accompanied by a friendly letter from Toriello:
Hello all.
I hope you’re all doing well and retaining as much of your partner base/ success as you recognized in better economic times.

I wanted you all to know I landed at a GREAT agency and have begun to make strides in developing our client base, content, marketing initiatives and partner relations. I am thoroughly excited to be a part of US PRESSWIRE and the close knit family of 250 photographers we work with.

I will be looking for any and all possibilities of where we can work together again. The corp address is Atlanta, as you can see, but I am working out of my home in NJ. It would be great to see you again. PLEASE keep in touch and please send updated contact info.
MLB was quick to object to this, and advised clubs of the MLB/Getty relationship.

This brings us up to date.

Now, just last week, Toriello again wrote to MLB clubs and offered US Presswire asset management, and MLB and Getty images were very quick to react. In response to the USPW solicitation, the MLB apparently sent out an email again reminding all the teams that Toriello is no longer with Getty, and is, in fact, with a competing entity, and encouraged each team to utilize the Getty asset management solution and reminded the teams that Getty is "the ONLY source approved for commercial use of photography."

Toriello wrote to the clubs:
Based on our earlier conversations, I'd like to get the ball rolling with our Asset Management solutions. Attached is a doc you can feel free to send around the Twins organization as budgeting time is upon us all. The numbers below are scalable to your needs. I would like to make myself available to the process of discussing this at length & how this can be an asset. The Club has some exciting opportunities ahead with the new stadium, and some of this increases the reason to look at this service, but please keep me informed of any feedback among your Club colleagues.
º Costs [twelve month contract minimum]

º $2,500 one-time fee
º Graphical interface 'skin' customization included
º Initial ingestion of wholly owned images included*
º Training included
º On-going support included
º Unlimited Users
Hosting Base Package (Up to 250G)
º $750/mo. ($3/G)
º Initial storage = approx 250,000 1MB images
º Each additional gigabyte of storage = $2.50/G (1,000 1MB images)
*If already digital w/ keywords and captioning completed

Peter W. Toriello
Director, Sales & Business Development
Fortunately, this time, Toriello didn't make the same USA Today mistake he did the first time around. Once again, MLB reminded people of the Getty relationship in a letter that was apparently sent out to all the clubs.

What Toriello is missing from all of this, is that the US Presswire access to MLB games is (or certainly was in the beginning), in large part, based upon the relationships that US Presswire President Bob Rosato had with MLB teams and executives which was, in turn, based upon his longstanding tenure as a senior photographer at Sports Illustrated. Rosato traded on that to get US Presswire off the ground, and USPW is a commercial venture that receives access only while in the good graces of the MLB.

With Getty, who pays a substantial amount of money for the exclusive commercial rights to MLB images, and who also expends a great deal of money covering MLB games, this is a colossal mistake by USPW. Getty likely will, in short order short-circuit USPW's access to many games, as MLB's good graces evaporate like dew on a hot August morning.

As the fractional revenue that USPW is generating is likely diminishing, bringing in Toriello seems like grasping at the straws of success, only to wake the sleeping giant of a Getty/MLB contract issue. I understand that Toriello was unemployed, but you don't board what looks to many like a sinking ship as the dock lines are crowded with traffic in the opposite direction. Coming from a place where atleast Getty paid $250 a game, he must have known that USPW wasn't even covering photographer expenses (in almost all cases).

While I can't support a work-for-hire deal for Getty freelancers, and think that those who accept such assignments are penny-wise and pound-foolish, they look like geniuses compared to those that partake in what amounts to free sideline fantasy seats that they justify by shooting during the game, pretending to be "one of the boys". In reality, the landscape is littered with the dashed dreams of those that were lured in by US Presswires' siren song, only to crash onto the shoals of revenue losses when no payments for months on end were forthcoming, and "promotional" giveaways of their images resulted in no revenue-positive sales in the first place.

Toriello seems to have accelerated MLB's need to address what US Presswire is getting for free, when Getty Images paid a princely sum for the rights contract. Look soon for US Presswire to be less present at MLB games moving forward.

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.

[More: Full Post and Comments]

Tuesday, August 25, 2009

The SEC, The AP, and Gannett Clash Over Rights

The Southeastern Conference (SEC) is in a clash with the Associated Press and Gannett over the rights to images and narratives of their sporting events. Lets start out with a few things first - The SEC is a collegiate athletic league that holds sporting events on their campus, usually in closed arenas or stadiums, where a price is paid for admission to what is easily argued is "entertainment". The Associated Press is a newsgathering cooperative that works for its members to cover the world, spreading the cost of that coverage over the multiple members who get images and text that they can then publish in their papers, drawing readers. Gannett is a for-profit corporation that does the same thing for each of its individual papers.

Each entity has a profit motive. While the AP's profits may be returned to the company to cover other costs, the member schools of the SEC are looking to grow revenue for their own betterment, and Gannett is looking to grow revenue to inflate their profits.

The problem is, as outlined (here) at Editor & Publisher, is that the AP and Gannett don't like being told what/where/how/when and why they can, and can't sell pictorial depictions or narrative descriptions of the SEC entertainment events. This is not the first time that sports entertainment entities have clashed with media conglomerates and cooperatives over profit-making masquerading as entitlement "news coverage" of these entertainment events.

What, though, should a photographer learn, or take away, from this clash?

(Continued after the Jump)

The individual photographer should realize that if reuse/resale/repurposing rights weren't of value to these outlets, they wouldn't be insisting that the individual photographers give them away for every assignment, and they wouldn't be fighting so hard to keep them so they can resell them at a later date.

In the runup to this seasons' college football season, The SEC has imposed new rules on the use of content that covering media conglomerates may make for free. Let's get one thing really clear here - the AP and Gannett (and others) are paying zero dollars to the SEC to cover these events, from pre-game to post-game. In an era when there was no cable television, and all sports scores and highlights came from the newspaper, all sports entertainment had to give a free pass to those who were making pictures and writing stories. That era is over.

In August of 2008, ESPN paid $2.25 Billion for whatever TV rights CBS did not already have, for 15 years. Just prior to that, CBS paid $800 million for a 15 year deal. $3 billion dollars for 15 years equates to $200,000,000 per year in valuation, much of which is attributable to the SEC football valuation.

Thus, when you're paying $200M per year, it would stand to reason that you would object to a newspaper posting their own video and audio game highlights on their own websites, especially when those websites make it less likely for a fans eyeballs to visit the ESPN or CBS websites. It would also stand to reason that you would be objecting when newspaper reporters are liveblogging the game, which would also diminish the likelihood of people listening to CBS or ESPN radio, or getting their own ad-driven blog feeds.

Further, photographs are being restricted from being sold beyond day-to-day coverage needs. In other words, covering media conglomerates can send a photographer, and provide those images to their papers, subscribers, or member newspapers regarding coverage of that game. However, these same conglomerates can't cut into the control and resale possibilities that the SEC would have of images from a particular game by selling images or stories themselves.

Another interesting point is that, in exchange for the AP/et al getting free access to generate intellectual property (i.e. images) for distribution to their members, the SEC need not fully employ a photo staff to cover each game since they are requiring the rights to use the images from all covering entities (AP/Gannett/etc) for whatever they want. Thus, if you are an SEC school photographer, you will likely not need to travel with the team as much, since every photographer/organization who signs the contract will be the reason you aren't going.

Once again, let's return to the freelance photographer. I want to make sure you get this point - when you're covering any assignment, and you justify to yourself why you signed away all your rights to images from the assignment, remember that when the AP was told that they could cover and use the images the next day for stories on the game, but that they could not resell as stock those same images you made for them and gave them the rights to, they said no. They objected, because they know that your images you gave them are valuable to resell and repurpose.

What about audio and video value? I know of many a colleague who has been asked by publications across the country "hey, can you get me some audio when you're not shooting, and also, since you have that camera that can shoot video, please shoot me some wide stadium video too." And then when you ask for additional compensation for that, they say "hey, it's just audio for the slideshow online..." or "we just need some video for the opener of your still gallery" and then suggest that they are already paying you, and thus it's really not worth any more, that, maybe, it actually IS worth more. Heck, it makes the galleries more engaging. Oh, it makes you feel like you were there! Hey! Isn't that what ESPN and CBS paid $3,000,000,000 for?

The networks make money off the commercials, just as the newspapers make money off the ads that are adjacent to the sports photos. The fact that newspapers got a free ride for this long is remarkable. The SEC (and every other sports league) has put up with free "news coverage" for as long as it suited their needs for free publicity. Now, they are not beholden to the AP/Gannett/et al, and media conglomerates are paying for the right to distribute the content that is created at these events.

Let me be very clear here though, I am not saying that anyone should sign away what the SEC is demanding. No organization should give away the intellectual property they create at these events any more than the individual freelance photographer should sign away their intellectual property rights when working for these organizations. Just as I would suggest to a freelance photographer that they not sign these bad deals and walk away, so should these organizations. Or, perhaps these organizations could enter into a licensing deal with the SEC to share a portion of the resale proceeds, just as they should fairly do for their freelancers. What's good for the goose is good for the gander. Any organization that demands all rights/work-for-hire from its' independent contractors with the intent of repurposing/profiting from the content produced, shouldn't be so surprised when other entities insist on the same from them.

At a time when the AP is not completely prepared or ready to take over the NFL contract from Getty Images, this could actually work out to their advantage. They were already going to be understaffing the NFL games, so perhaps the planned cadre of SEC photographers can be dispatched to the NFL? For AP photo-wise, this could be a good thing.

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.

[More: Full Post and Comments]
Newer Posts Older Posts