Stock photography emerged in the beginning of the last century, and stock agencies have been mediating image sales at a hefty premium ever since. This industry was created by the middlemen, and just like decades ago, most of the money ends up in their hands.
Whether reselling exclusive shots for magazines in the 1930s or licensing their vast online libraries for a subscription today, stock agencies have always kept a lion’s share of the image sale revenue. Even now they manage to take away up to 80% of the image earnings. Given that the still image market is predicted to hit $4.5 billion before 2020, industry giants are certainly comfortable with this state of affairs.
In the past few decades, stock photography has been shaped by major efforts of consolidation and restriction. Getty Images pursued an aggressive strategy of competitor acquisition. Once their strong rival, Corbis Corporation purchased and locked up a vast archive of historic images before getting acquired itself. However, focused on taking over the biggest market share, most stock agencies failed to reinvest their profits into improving the experience for existing contributors and consumers.
And now the profits are falling. In part, this is due to the costly acquisitions and library expansion the current stock agency model depends upon so heavily. But this model is hardly sustainable. Abundant photography is turning into a commodity, and as mere content resellers, agencies may ultimately be forced to lead a price war they won’t be able to afford if their spending keeps outpacing revenue growth. Ex-CEO of Getty Images once said that it is “lovely to get milk, cream, cheese, yoghurt and meat without buying the cow”, but what if everyone around is a farmer? If continued, this blind expansion will ultimately happen at the expense of the buyers’ wallets or the photographers’ payouts.
This is not the only force pushing photographer earnings down. In the past few years, social media, royalty-free microstock, and widespread access to quality gear have all made it harder for content creators to secure their income. Furthermore, they have no reliable and universal pricing mechanism at hand. The process of image valuation is currently obscure and varies from platform to platform. When each middleman arbitrarily slaps its own price on an image, both the seller and the buyer are cut out of the picture. Instead of obeying genuine supply and demand, such a market is driven by false signals that have little to do with actual quality, popularity, or novelty of images. This problem could be solved by introducing an open trading system, accessible to all buyers and sellers, scalable enough to accommodate the growing multitude of independent creators and billions of peer-to-peer transactions. A blockchain registry system can provide all of these benefits and more. Thanks to the intensive development and increasing maturity of this technology, this is a now top priority step on IPStock’s roadmap.
The current stock photography model with its undervaluation and vast image selection may seem to favor the buyers, but in fact it fails to make the market accessible to them. The payout cut on the photographer’s side doesn’t turn into a discount for the buyer, but makes up a bulky commission for the middleman instead. Huge independent collections of images take hours to sift through, and instead of direct cross-platform integration of metadata and statistics, the buyers have to adapt to the peculiarities of multiple separate search interfaces. Insights into the licensing history of a particular image are virtually non-existent. And the notorious “stocky” aesthetic is a direct product of centralization and intermediary selection policies. There are hardly any means or any will to address these issues in the realm of the traditional stock image industry. It has become as hard to navigate for the buyer as a giant overcrowded wholesale marketplace. IPStock proposes to level the playing field for the buyers by giving them direct access to blockchain registry, large-scale data analysis, and smart contracts.
Stock agencies may be waking up to these challenges, but the rules of the game are changing too profoundly for the old approach to remain relevant. A massive amount of authentic content makes its way to social media, and platforms for sharing free photography like Unsplash and Pexels are attracting a soaring community of creative professionals and amateurs. They are a living proof that image creators and consumers value direct connections, and prolific photo communities can thrive beyond obsolete licensing models. Both the demand and the supply are here: we just need a new formula to connect them.