Agency Based Discussion > iStockPhoto.com

Getty Images reduces prices....

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hatman12:
"Getty Images has announced a new Web-use price of $49 for a 500k 72DPI file of any of its images, regardless of brand or pricing model. This fee entitles the purchaser rights to use any selected RM image on any commercial or editorial Web site, e-mail, mobile devices or multimedia project for one year. RR buyers get the same rights for up to 10 years and rights to use an RF image in perpetuity. This is a major reduction from Getty’s RM prices in January 2007.


At the end of 2005, Getty CEO Jonathan Klein indicated that about 10 percent, or roughly 60,000, of Getty’s total RM licenses were for Web use. Sources indicated at the end of 2006 that this percentage had grown to 15 percent or more. It is possible that much of the 9,000 image drop year-over-year in the reported number of RM images licensed in the last quarter was due to a fall-off in Web usage. The company has never given any indications of the number of RF licenses that were for the smallest file size, which might be an indication that the image was used on the Web.

Getty believes this new low price will help it capture a portion of the market that might otherwise go to competitors, particularly microstock. But microstock images of this file size license for between $1 and $2.

A few figures are worth contemplating. At a minimum price of $315 per usage, 60,000 RM images would represent $18.9 million, and in theory, many of the images used on the Web were priced at a much higher figure. That same number selling for $49 equals $2.9 million or a $16 million loss in revenue. To stay even, Getty would need to license rights to 385,714 at the $49 figure...."


Comment from Hat:  this only confirms what I've suspected would happen; the macro agencies will have to reduce prices, but on the other hand the micro is massively underpriced; over the longer run we can expect them to meet in the middle somewhere.  It wouldn't surprise me to see micro prices double over the next five years or so.

leaf:
well i think micro prices definatly have room to grow.

if some joe is making a website or brochure and has the $1.00 budget to spend, I think he can afford the $10.00 image as well.  Both are pennies in the big picture.

What might not have much room to move is the mobile client, web blog purchases or school article people.  They aren¨t near as picky as to the image they want and about $1.00 is all the image is worth to them.

which is where the midstock at lucky oliver perhaps comes in.

$1.00 images for those who want it, and $10.00 images for those who are picky.

stokfoto:

--- Quote from: leaf on August 31, 2007, 17:18 ---well i think micro prices definatly have room to grow.

--- End quote ---
I totally agree with that but competition among micro sites could stop this from happening :(

sharpshot:
Yes, I agree that competition might stop this from happening.  If microstock sites raise their prices too high, I would expect one of them to try and undercut the others.  This would probably attract a lot of buyers and would force the prices back down on the other sites.

The sites that are selling at slightly higher prices than the microstock sites don't seem to be doing well at the moment.

I also wonder if raising prices is going to improve our income?  It might be that the extra sales at lower prices makes more money than less sales at higher prices.  Finding the optimum price could be tricky.

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