Interview with Dittmar Frohmann of Fotolia

Features

Interview with Dittmar Frohmann of Fotolia

By Chris Ferrone June 23, 2006

Recently Chris Ferrone caught up with Dittmar Frohmann the managing director of Fotolia in Berlin and the only delegate from the world of Micro-stock photography to attend the 2006 CEPIC Congress in Biarritz France. Prior to his engagement with Fotolia, Mr. Frohmann studied Business & Management in Bournemouth and spent several years working in the music industry representing US and UK record labels in Germany such as Strictly Rhythm or React and running his own label blaou since 1995. In addition to his career in music Frohmann ran a small gallery in Berlin-Mitte exhibiting contemporary talents from the exciting art and design scene in that happening city. In an effort to gain insight from the perspective of a microstock company manager, Chris asked Dittmar if he would consent to an interview and Dittmar kindly obliged.

1. As a relative new-comer to the industry, what was your over-all impression of the CEPIC Conference in Biarritz?

I think that the two driving forces behind Fotolia, our CEO Thibaud Elziere and our President Oleg Tscheltzoff just were afraid to attend CEPIC - so they sent me. The congress strongly reminded me of past experiences on music publisher conferences. I saw a lot of money walking around - single companies who are commanding huge repertoires. Later I learned that those were only the medium sized players while there was some kind of simultaneous shadow event behind closed doors with Corbis and Getty in the Casino on the beach. I never saw any of these people. Biarritz presented itself in the best light and typical pre-season condition. Good organisation by CEPIC's Sylvie Fodor.

2. What did you hope to accomplish by attending the conference and did you succeed?

Fotolia wanted to show up and say "Hello! We are here - to stay." We wanted to meet press. We were looking for both companies with repertoire and new partners that help to extend our distribution channels. As a newcomer to the industry I also had to catch up on the whole industry structure, the importance of certain organisations, the names and faces of movers & shakers. Fortunately I enjoyed the kind assistance of Andy Goetze who introduced me to so many useful contacts and who provided instant background information. So these company and personal objectives were met.

Here is something that did not work out as planned: Both conference buildings the Casino and the Bellevue are right at the sea both looking on the same beach. So one morning I got up very early, took the Jupiter Images towel from the bag of goodies and went down to the beach: While the tractor that cleans the beach each morning finished combing in those neat lines I grabbed some heavy stones from a nearby building site. I put those on the towel and dragged my load up and down the beach writing a giant "F" "O" "T" "O" "L" "I" "A" on the sand. Then I ran up the hill to get a good view of this creation but ended up seeing nothing more than two elderly people with metal detectors walking straight through what should have been an outburst of witty guerrilla promotion. So back down the hill and another attempt with an astonishingly similar result. It was just a bit hotter and more morning joggers watched me ploughing the beach with my towel. After the third attempt still with only marginal results I simply had to retire because of physical weakness. Maybe we do T-Shirts next year.

3. As the only representative of a micro-stock company at the conference, how did most people react to you when they learned what your company is all about?

I was introduced to all sorts of people, most of them representing medium-sized national stock, press, lifestyle or heritage archives.

A typical conversation would be:

Me: Hi. I am Dittmar from Fotolia.
Person: Hi. What is Photolio?
Me: We do microstock.
Person: Microstock?
Me: We sell RF photos for a Dollar.
Person nods, looks around nervously, eventually discovers someone on the other side of the hall and runs off.

I personally do understand those reactions because we really are stealing the butter off their breads. And it is true: of course Fotolia gladly accepts their professional customers, who are delighted by our good quality for little money approach. But these clients are just a side effect. We also create a completely new much larger customer segment. Business that they would never touch. We sell pictures to the "Pariah" such as private people, pizzerias or pedicure places. The sub-assistants of conventional stock agency would not even devote a scribble in their pleasantly designed memo pad and put down the phone quietly. It should be noted that not all people I met were that ignorant or negative. Few actually appreciated our concept. Most of them consider Fotolia as a threat but some at least spoke about common grounds and possible co-operations.

4. How do you feel the micro-stock business will fit into the stock photo industry over the long-term?

Of course micro stock will make its way. We sell good quality at a very low price. One of the main tasks of our helpdesk is to ensure the astonished customers that this really is the price for those images. There is no doubt that micro stock will play a dominant role - it is already the case in volume and soon in revenues too. The demand for images rises with the ever growing number of websites and blogs. Worldwide there are so many small companies who all require images. Hardly any of them can afford conventional over-priced images. So we are only responding to a real need. People use our images to brush up their websites, their power point presentations or just as a screensaver. We even have collectors. Magazines and graphic designers start to use images in a completely new way. One German publication used 15 small images of different sunsets all on one page as illustration for an article about the summer. It cost them about 30 Dollars. Just imagine the price of traditional stock.

5. Is it possible for a professional photographer to make a living offering images on a micro-stock site? If so how many images would it take to see enough sales to justify the cost?

Yes it is. Our top photographers are professionals and they would not be with us if they did not receive sufficient income. But you need the right images that illustrate concepts, people shots etc.. Andres Rodrigues has already gone on gold rank at Fotolia. In order to be a successful stock photographer you either need to find your individual but always commercial style (Check out Bobby Deal in this regards!) or you have to come up with a fairly large and diverse portfolio showing various aspects of life - preferably the aspects that make models smile in a modern office communication set-up.

We publish our most successful artists on http://www.fotolia.com/ranking/.

6. Are most of your contributors professionals or amateurs? Do you see this changing and evolving in the future?

We have both, and this is the magic of the internet. Everyone can be part of Fotolia. Whether you want to make a couple of thousand Dollars a month or just some hundreds, you are welcome here. The interesting development is that Fotolia is playing an important role as career launch pad for professional photographers already. Most of our amateurs invest their income straight into hardware in order to catch up with the pros. Overall there is an enormous pressure from the repertoire side because of the exploding amount of high quality images (which itself has been triggered by the inexpensive availability of production material such as camera, computer and editing software). In effect there will be as strong industry polarisation with more amateurs that push into the market willing to enter at any price. Those will be met by a decreasing elite of professional photographers who command higher prices. This might sound too theoretic but economics usually never lie.

7. Micro-stock sites like Fotolia have been accused of undermining the livelihood of independent photographers. How would you respond to such accusations?

Technology is changing business. Without any doubt Fotolia and the micro sites have an effect on the photo industry. I am afraid to say this but photographers will be forced to adapt to this situation. Micro sites will cover about 70% of the image market but there still is going to be enough business for the other 30%. There will always be exclusive campaigns that require exclusive shots. Still the photographers must be aware of the changing scenario: There will be micro stocks plus a couple of more expensive RF agencies, that mainly target niche-segments or allow for high service levels, and there will be the more high end RM agencies. So this accusation hits the wrong people. You might as well write a hatemail to Nikon for developing inexpensive digital cameras. Or to Adobe for those evil correction tools. The developers of the internet are bad guys too.

8. Many customers are concerned about the safety of using images from a micro-stock site, particularly about whether there are necessary model and/or property releases. Are these fears justified? What has Fotolia done to ensure that images conform to professional standards?

All Fotolia images are model-released. We keep tight control of our contributors and we have developed thorough selection procedures so that each model release and each image is checked several times - not by machines but by humans in high income countries. Our contributors are more than aware that they could loose a lot of money with just one mistake. So we keep our members posted with information. They learn about copyright issues and mandatory releases in the training before their first upload. They read it in the blog, in the forum and in our new Wikilia knowledge base. The photographers know that it is pointless to cheat. We are in close contact with our most successful photographers, the ones who have lots of pictures with us. They are professionals and they won't jeopardize their business with risky images. And to be quite honest, I am not sure if our level of security is really lower than the one from classical agencies. Some people might even claim the opposite.

9. Recently one of your major competitors, iStockphoto, was purchased by Getty Images and Jupiter Images has invested in StockXpert / Stock.Xchng. Has this had any effect on other micro-stock sites such as Fotolia? Do you anticipate that other major stock photography companies will attempt to compete in this arena?

Maybe. We don't know what they will do. But we know what Fotolia is going to do. In a period of just six month we experienced ballistic growth. We gained tens of thousands of customers and have a collection of almost one million photos online. We have a strong strategy and a clear and well defined roadmap to bring Fotolia to a very high level soon.

10. Alan Meckler, CEO of Jupiter Media, has recently compared his subscription offerings to micro-payment sites. Have you found that you are targeting the same customers? What is the key difference between the offerings?

Of course we all compete at a certain point. Such a subscription plan is not directly comparable with a micro offer where you need to spend quite some money to get a picture. In the example you mention you need to spend hundreds of Dollars before you are able to download one single image. Subscription models are an interesting offering for bigger companies but they are not attractive to many private consumers who play an increasingly important role as customers. So we need to be able to provide better images, more images, and for a better price. We must also improve the user-friendliness of our sales dialogue. We are currently working on the technical side of that.

11. Shutterstock recently began offering footage. Does Fotolia have any plans to offer other products besides stock photography?

We can't comment on that now.

12. Any plans to offer wholly-owned images? Do you see your relationship with the photographers as an asset or a liability?

For now we have no plans to own images. Fotolia has to be seen as a marketplace for stock images. Agencies who own images are more than welcome to sell their stock via Fotolia and to get in touch with our tens of thousands of customers. The relationship with the photographers is an essential part of Fotolia's success. Our photographer's community is our biggest asset and an extremely robust competitive advantage. Our photographers give us precious insights and inspiration.

13. With a large amount of images uploaded everyday to your site you must find it difficult to sort through the clutter. How do you ensure that the buying customer sees the best and most relevant content in the search results?

Our system takes in account both novelties and successful images. We have our secret system to sort that out. The development of the search engine is one of the challenges of Fotolia. Fotolia constantly develops new features to improve the customer's search experience. For example we
just implemented Similia, a tool that proposes similar images based on the behaviour of our members (buyers and users). We also offer the usual features such as galleries and pictures by the same model or in the same series.

14. What type of content sells best on your site?

Please have a look at http://www.fotolia.com/most/

15. Do you find some productions are too expensive to offer in micro-stock? For example, shoots with many models require large sums to produce and would have to sell thousands of times in micro-stock to justify the cost.

A photographer must take the right business decision for his image. But it is important to bear in mind that despite the low sales price a top image can bring thousands of Dollars in micro stock, since it will be sold thousands of times. In such expensive set-ups the photographer bears the risk of the production cost, so many photographers will avoid this risk. But photo creations with many models are best sellers on micro stock. So the photographer does not get around to do his individual calculation ... based on reality. We can only hint that we really sell very many images at Fotolia.