Client care: Photography licensing question Locked

Started 11 months ago | Discussions thread
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Michael Fryd
Michael Fryd Forum Pro • Posts: 15,932
Re: Client care: Photography licensing question

Steve BB wrote:

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Can someone remind me why it is, that we, as photographers, don’t just charge for the job and then let all the parties involved share?

A lot of it is historical. In the days of film, the big money in retail photography was in selling physical prints an albums. This allowed the photographer to quote an affordable up-front fee that covers his costs, and them make a profit by selling prints, albums, etc. People understood the concept of paying for a print, as it was a physical object, and therefore it cost something to produce.

In terms of commercial photography, it depended on your relationship with the client. If you were an employee, staff photographer, etc., then you got paid for your time, and the images belonged to your employer. If you were an independent business, you would negotiate a licensing fee. People understood that photography required specialized skills, and the those with the ability to reproduce images understood the concept of licensing and copyrights.

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Today, the product is usually a digital file. Retail clients don't automatically accept that they should be paying for bits. Retail customers don't understand copyright, and think that if they have paid a photographer to take a photo, then the client automatically owns the photo. This isn't how it works in the USA.

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In today's world, retail clients still don't understand copyright and licensing, however they now have the ability to easily reproduce and publish images. This makes it far more difficult to track and license use. In the old days, the client would need to come to you for additional prints. Today they can make those prints without your knowledge.

At the high end, clients still understand the concept of copyright, but there aren't as many clients in this class.

In the middle, we have the small business customer (like the OP's designer). They don't really understand licensing and copyright, but they do have many uses that would traditionally require separate licenses.

Some photographers are still trying to use the old model, and many have moved on to new business models.

One business model is to estimate the uses that the client will make of the images, and then charge a flat rate fee based on your estimate for an unlimited license (or even a transfer of copyright). If on average, your estimates are correct, you make the same revenue. I know a number of businesses that have been very successful with this model.

It turns out that many large clients love the idea of not having to track licenses. They don't mind paying a little extra in up-front fees, if they no longer need an employee dedicated to tracking usage rights.

Of course, this business model depends on the types of images you are shooting. If they are images with a limited useful lifetime, then it works well. If they are images that you think will have decades of value for many years, you may want to stick with limited licensing.

For instance, I shoot produce photos for a local swimsuit manufacturer. Experience tells me that 90% of the swimsuits won't be sold after a year. Experience tells me that 95% of the images will appear only in catalogs and on e-commerce web sites. I know a few of the images will end up in advertisements, trade show displays, etc. What I don't know is which images fall into what category.

I could individually license the images. I could require add on licensing for the few swimsuits that carry over to next season. I could require additional licensing every time they want to use an image in an ad, or at a trade show.   But that would make a lot of extra work for me, and a lot of extra work for the client.  It's just easier to figure in the amount of usage I expect as part of my initial fee, and then not worry about it.  Everyone is happier, I do less work, and make more profit.

Now, I am taking a risk.  It might be that one of these images somehow becomes incredibly  valuable.  In that case, I would lose out on any additional licensing fees.  That's a risk I am willing to take.

For this client, my business model is an upfront fee, and the client does whatever they want with the images.

Not all clients are the same.  If I am working as an "in-house" photographer for a large event or awards show, they will want full, and exclusive rights to all the images I take.  I get paid well for my time, and they get the images.

If I am taking photos of homes for a designer, a lot would depend on whether I saw a secondary market for the images.  If I see a secondary market, I am more likely to give a limited license for the images.  If there is no secondary market, I would give an unlimited license for the expected uses (and price according to those expected uses).  Even if I saw a secondary market, my initial license would include the uses that the designer is likely to need.  That would include providing copies to the homeowner for the homeowner's personal use.  (I would also guide them to use me as the vendor should they want prints).

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What business model you use is a business and marketing decision.  What segment of the market are you targeting?  Does a particular pricing model give you an advantage over your competition?  On average, does  that pricing model increase per job revenue, decrease it, or is it revenue neutral?  Does the pricing model increase or decrease your costs?

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I know a very good photographer who has amassed an amazing library of photos over a career spanning many decades.  Among other niches, he has established relationships with some of the top rock and roll performers and bands.  He has published a number of books profiling the various groups.  His plan was to retire, and live off the licensing revenue from his library of images.

The reality is that his library generates very little revenue.  People just aren't willing to pay for images the way they used to.  He still has to work ti make ends meet.  When he isn't working, he and his wife spend time searching the web for unauthorized use of his images, and sending cease and desist letters.   His library creates work for him, and doesn't bring in the income he hoped it should.

 Michael Fryd's gear list:Michael Fryd's gear list
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