Features
Licensing Logic – Getty’s thinking on Rights Ready pricing
After several weeks of anticipation, Getty Images has launched their new "Rights Ready" licensing model and the special collection of images, called Riser, to which the new price structure applies. The company's first announcement of the new approach to RM licensing met skepticism from photographer groups who questioned the unlimited term and territory provisions of the Rights Ready model. This week, Getty made the Riser collection of images and the Rights Ready pricing available on-line. Now that the company has revealed the actual Rights Ready prices, one can assess them and make a better judgment as to the value of Rights Ready for art-buyers and for photographers.
Few will argue that Getty had good reasons for seeking an innovative approach to licensing stock imagery. Clients license the majority of images as RF because it's faster, simpler and cheaper and most clients do not need the exclusivity protection offered by the more expensive RM licensing model. At the same time, the numerous variables that determine RM licensing fees defy fast and easy online pricing mechanisms. With Rights Ready, Getty has tried to offer clients the on-line convenience of RF while maintaining a price level closer to RM. As explained by Robert Gubas, vice president of product marketing at Getty Images, in the company’s August 3rd press release about the new model, "In a world of ubiquitous, rapid-fire communication, our customers have to be more nimble than ever, and licensing must adapt accordingly. The rights-ready solution makes licensing fast, flexible and predictable while delivering a level of rights control that limits the possibility of over-exposure in the marketplace.”
Ultimately, Getty did set a ten-year limit on the term for all Rights Ready licenses. One might argue, however, that in our fast-moving, ever-changing marketing environment, ten years is an eternity. Jay Levinger, Product Marketing Director for Getty, agrees the ten-year term may have little practical effect on some clients. He says Getty implemented the time limit for Rights Ready licenses for the sake of the photographers: “The biggest difference between the 10-year term and an unlimited term is the ability for contributing photographers to have long-term control over the image.” Getty left the geographical terms unrestricted, however. In addition, Rights Ready dispenses with other RM pricing factors, such as reproduction size within a brochure and interior vs. cover placement for commercial uses. (The pricing model does distinguish between interior and cover placement for editorial uses.)
The lack of geographic restrictions and the ten-year term of a Rights Ready license almost always means Rights Ready pricing will be lower when strictly compared with RM. For example, the Rights Ready fee for use in a brochure of $800.00 permits use on the cover of the brochure for global distribution for ten years with an unlimited print-run. The RM fee for such a license would exceed $800 many times over, which makes the Rights Ready fee look like a raw deal for the photographer. To be fair, the ten-year, global use, unlimited print-run brochure cover licenses come only once in a blue moon. When compared to average prices and typical uses, the Rights Ready price may not look so bad. If the average RM fee for ALL actual brochure uses (all sizes, placements and terms) likely comes to less than $800, over time, the Rights Ready price makes more commissions for the photographers.
While Getty will not disclose the average price of all brochure sales, they acknowledge that the average RM prices per image factored heavily into how they set the prices for Rights Ready. The average-RM-price rationale certainly does not hold up, however, when we look at the "All Commercial Uses" Rights Ready fee of $2,250. One wonders whether a clever art-buyer, when seeking an image for broad usage, won't check the Riser collection first in order to keep costs down, but continue to look in the general collections for lower priced (by RM standards) uses. If most of Getty's RM customers used that strategy, average prices would have to decline. Levinger counters that for broad uses, average prices may, in fact, increase: “We don't anticipate that prices will decline given the combination of individual RM use pricing and flexible license pack pricing. (*) It is also important to highlight the fact that some customers will take advantage of the broader use categories in Rights Ready and trade up from lower priced RM licenses.”
We need to consider another important licensing factor as well, that of exclusivity. Rights Ready pricing offers no exclusivity to the client. Customers seeking exclusivity are advised to call to check on the possibility of a total buy-out of a Riser image, another highly rare occurrence. Viewed in this context, perhaps we should compare the Rights Ready fees to RF pricing, which offers no exclusivity, either. Such a comparison shows Rights Ready in a much more favorable light.
From which market segment will Getty draw more clients to Rights Ready, RM or RF? Levinger believes the new model will pull clients from both sides in such a way that average prices will increase. “We continue to hear feedback from some customers that even though they have the budget for RM photography, they license RF photography because it is easier and more flexible,” Levinger says. He continues, “Rights-ready will offer a new product for these RF customers. In addition, in some cases we expect up-selling from narrower RM licenses to broader RR licenses at higher price points.” If Levinger is right about this, Getty has truly accomplished a win-win for photographers and art-buyers, alike.
(* Editor’s note: “Flex-pack” licensing is an alternative licensing model Getty launched earlier this year.)
Click here for more information from the Getty site.
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