Author Topic: Changes to calculation of earnings - Freepik (Read 7503 times)

Souf10 · « **on:** August 01, 2022, 11:16 »

I got an email today from Freepik Tooday about changes to calculation of earnings . I still don't get the idea though

This change aims to establish a more robust calculation system that benefits contributors that provide valuable content for Premium subscribers while preventing fraudulent activities performed by some users.

How does this calculation system work?

As with the previous system, earnings calculation is based on the share of the net revenue obtained from Freepik’s Premium subscribers. However, under the new system, the PPD rate for a specific download made by a specific subscriber is calculated as follows: Freepik takes one subscriber’s net revenue and divides it by the number of downloads that subscriber has made during a particular invoice period. Then, this amount is multiplied by 0.5 to calculate the 50% share for the contributor whose resources were downloaded by that subscriber.

To read a detailed explanation of how this new system works, please go to Pay per Download and RPI on Freepik’s Contributor FAQs.
https://support.freepik.com/s/article/Pay-per-download-and-RPI?language=en_US

pancaketom · « **Reply #1 on:** August 01, 2022, 13:53 »

I don't know how the details work, but the result is probably more money for Freepik and less for the artists.

Jo Ann Snover · « **Reply #2 on:** August 01, 2022, 17:12 »

I read the information Freepik provided about their new calculation (from the link above) and it seems pretty straightforward - the diagram makes it pretty clear:
https://support.freepik.com/servlet/rtaImage?eid=ka03V000000Y1uY&feoid=00N3V000001WcHX&refid=0EM3V000003DfDj

It seems that the big change is that before they took all subscriptions as one big pot and then divided up 50% of that. Now, each subscription is tallied individually so that you could be a big winner, as a contributor, if your images were downloaded by subscribers who didn't use many images that month. Likewise you could be a big loser if your downloads were from a subscriber who used a lot.

A hypothetical example (assuming I've understood this correctly).

There are two monthly subscription prices, one if you pay yearly and one if you go month-to-month. I've rounded these to make the math simpler and taken two extremes of download numbers to highlight how the system works (in other words this isn't likely to be exactly what you'd see.

Subscriber A pays $20 a month and makes 10 downloads that month

Subscriber B pays yearly, $12 a month, and makes 100 downloads that month

Downloads from A pay $1 each (50% of the subscription goes to contributors)

Downloads from B pay $0.06 each.

Freepik's share is the same in both old and new scenarios - 50% of $32 or $16

Under the old system, 110 downloads would pay contributors $0.145 each

Under the new system, if you had four downloads from subscriber A, you'd receive $4; but if they were from subscriber B it would be $0.24. From the old system you'd have received $0.58 for four downloads

Obviously you would likely have a mix of heavy and light users so it could come out about the same.

With all of these schemes to share a percentage of the revenue, the agency is sitting pretty no matter how many downloads subscribers make. It's the users who lose out if more files are downloaded unless there's a (reasonable) minimum royalty

How a royalty scheme prevents any type of fraud is a mystery to me. If there's fraud they should tackle that by stopping it, no?

Souf10 · « **Reply #3 on:** August 01, 2022, 17:29 »

Quote from: Jo Ann Snover on August 01, 2022, 17:12

I read the information Freepik provided about their new calculation (from the link above) and it seems pretty straightforward - the diagram makes it pretty clear:
https://support.freepik.com/servlet/rtaImage?eid=ka03V000000Y1uY&feoid=00N3V000001WcHX&refid=0EM3V000003DfDj

It seems that the big change is that before they took all subscriptions as one big pot and then divided up 50% of that. Now, each subscription is tallied individually so that you could be a big winner, as a contributor, if your images were downloaded by subscribers who didn't use many images that month. Likewise you could be a big loser if your downloads were from a subscriber who used a lot.

A hypothetical example (assuming I've understood this correctly).

There are two monthly subscription prices, one if you pay yearly and one if you go month-to-month. I've rounded these to make the math simpler and taken two extremes of download numbers to highlight how the system works (in other words this isn't likely to be exactly what you'd see.

Subscriber A pays $20 a month and makes 10 downloads that month

Subscriber B pays yearly, $12 a month, and makes 100 downloads that month

Downloads from A pay $1 each (50% of the subscription goes to contributors)

Downloads from B pay $0.06 each.

Freepik's share is the same in both old and new scenarios - 50% of $32 or $16

Under the old system, 110 downloads would pay contributors $0.145 each

Under the new system, if you had four downloads from subscriber A, you'd receive $4; but if they were from subscriber B it would be $0.24. From the old system you'd have received $0.58 for four downloads

Obviously you would likely have a mix of heavy and light users so it could come out about the same.

With all of these schemes to share a percentage of the revenue, the agency is sitting pretty no matter how many downloads subscribers make. It's the users who lose out if more files are downloaded unless there's a (reasonable) minimum royalty

How a royalty scheme prevents any type of fraud is a mystery to me. If there's fraud they should tackle that by stopping it, no?

Thank you . Your explanation is very clear, I appreciate your help

Artist · « **Reply #4 on:** August 01, 2022, 23:22 »

Obviously expense is more than the profit. The prices will get lower and will touch the lowest of low.
Freepik was sold to a investor at a good amount and now they need the cream and butter.

Sustaining with such business model is hard for company as well as contributors.

Justanotherphotographer · « **Reply #5 on:** August 02, 2022, 01:21 »

Isn't it just so they can pocket the sub fee of buyers who don't download anything in a given month or forget to cancel a subscription? I believe this is one of the reasons many companies love the model.

EDIT: Yes I think this is exactly what it is. Under the scheme if someone uses zero of their dls FP gets to just pocket that. Contributors make less overall , i.e. Freepik now get more than 50% of subscription income. I image this is not an insignificant difference overall, they sell your work for so little buyers may just let subs run in months they don’t even need any dls.

denvinbo · « **Reply #6 on:** August 02, 2022, 02:44 »

Before, the earning rate for 1 download is fixed and instant. I dont know if there's any other details involved in the calculation, but this might be the reason for those fraudulent acts they state.

Now, a prem user can still freely download the same amount as before but the money paid to the contributors per 1 download will reduce according the the amount. Worst situation is a heavy user who uses up their download capacity every single day (meaning around 3000 downloads/month), and i think they consider this a fradulent act before the new policy. (like creating many premium accounts then downloading your own files, this might generate more money than what you pay for premium, i dont know).

Artist · « **Reply #7 on:** October 01, 2022, 02:56 »

I just found that they have reduced the contributor share a lot from what they use to pay.
With their new earning model, people have went down from lowest to ultra lowest and then they also need a certificate of residency, which reduces the total even more.

tätarätä · « **Reply #8 on:** October 01, 2022, 03:04 »

Don't have any image at Freepik and no indention to change that.
Just out of curiosity. How much do you earn per 1000 images at Freepik monthly?

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Author Topic: Changes to calculation of earnings - Freepik (Read 7503 times)

Souf10

pancaketom

Jo Ann Snover

Souf10

Artist

Justanotherphotographer

denvinbo

Artist

tätarätä

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