A Brief History of Stock Photography — Then Came The Aggregators (Part 2)
On the first part of this series (Part 1 — The Beginning) we reviewed the very beginning of stock photography, with a quick flashback into the 80’s and 90’s.
From individual photographers realising a business opportunity, the industry evolved to include more creators, more customers, and more agencies.
The range of agencies — from mom and pop to something more corporate — as well slow-tech tools for getting images may have been a catalyst for Getty and Corbis, a new type of agency: the conglomerate. These models, launched by monied pioneers like Bill Gates and Mark Getty, disrupted the industry with a model of acquisition and consolidation.
First came Corbis
Originally called Interactive Home Systems, Corbis launched in 1989, founded by Bill Gates as a means of digitizing and licensing artwork and historical images. By the late 90’s, they focused entirely on licensing images and video footage and building their library through acquisition of collections like the historical Bettmann archive, Digital Stock Corp and a range of others.
Then came Getty
In 1995, Jonathan Klein and Mark Getty launched Getty Images offering a mix of Rights Managed and Royalty-Free Images available for download and on CD ROM. What made Getty stand out was its aggressive acquisition tactics. Getty focused on acquiring already-successful agencies and became a single stop for licensing needs. In 1997, Getty merged with Photodisc, by 1999 had acquired Tony Stone, and continued to acquire agencies. Sometimes these agencies continued to operate autonomously, but often, Getty would absorb them completely.
Creator frustration builds
While the giants were growing, frustration began to build with many contributing photographers.
The rise of Miscrostock, which we’ll discuss below, and its influence on purchasing behavior — which favors volume over individual image sales — trickled into a wave of photographers upset with Getty.
A series of articles, including an expose by Microstock journalist Jim Pickerallnoted that 69 percent of surveyed Getty photographers reported a significant drop in revenue, while cuts in the agency’s editing staff left photographers feeling ignored.
Microstock or Bust: iStock, Shutterstock, and the copycats.
Until microstock, licensing images required a significant budget.
If you wanted to license an image for an email campaign, you’d likely need to spend a few hundred dollars.
Many startups didn’t have the cash. On the creators side, many photographers felt agencies like Getty and Corbis were inaccessible to contribute to unless they had an inside connection.
Microstock was there to solve this problem, offering more affordable images and a more democratic opportunity for anyone with a digital camera to contribute.
iStock
Launching in 2000 in Calgary, Alberta, Canada by Bruce Livingstone, iStock provided a solution to entrepreneurs who needed imagery but previously couldn’t afford it. Initially offering images for free, by 2001, iStock images ranged from a few cents to $10, using an expiring credit system. Buyers could purchase blocks of credits and use them for images as long as the credits were still active. The licensing terms were even more liberal than traditional Royalty Free terms, with restrictions only coming in for mass viewership like Hollywood films, billboards or large circulation print media.
Since payout generally ran under $10 per image photographers had to adopt a new strategy: make money on volume.
Initially, many creators were skeptical of these low fees, but also intrigued by the promise of volume exposure and payouts.
Shutterstock
A few years later, serial entrepreneur Jon Oringer saw a similar opportunity and launched Shutterstock in 2003 with 30,000 of his own photos shot on an $800 Canon rebel. Oringer‘s goal: get startups access to images they could use for newsletters and other marketing channels without breaking the bank. The solution: a $49/month subscription for unlimited access to Oringer’s photos.
Shortly after, Shutterstock opened its doors to outside photographers, increasing subscriptions to $139/month, and later to $249/month. Access changed to 25 images/day, and photographers were paid out 25 cents per image. If a buyer downloaded the full 750 images that month, Shutterstock would have been paying out $187 — less than most would charge to license a single image — and would operate at a loss.
Knowing that buyers couldn’t possible download their full monthly allotment, Shutterstock could profit based on the margins of images buyer did not download.
Creator Frustration Mushrooms
Even though Shutterstock, iStockphoto and their copycats might have looked like the saviours of the industry, they soon started to become much similar to the very agencies they aimed to replace.
In the next post, I’ll continue to follow the rise of Microstock and the journeys of the “new kids on the block” — Shutterstock and iStock, including the current state of the industry and a few words about its future. Stay tuned!
