Dan Heller's Photography Business Blog Industry analysis from www.danheller.com

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Sunday, December 20, 2009

Interesting feedback to my "Climate Change" post

I had an email exchange (and then a phone call interview) with someone that I found interesting and provocative. Here's the background:

Two postings ago, in Weathering Climate-Change Within the Photo Industry, I wondered what the reaction might be among a group that I call traditionalists (pros, trade organizations, pundits and bloggers) if it was substantiated that most licensed images did not come from pros, but were bought and sold on a peer-to-peer basis between everyday non-professional photographers.

Then, in the post that followed, Lying about Photo Licensing, I said that we are getting closer to actually learning the truth about the pro-to-consumer ratio in photo licensing due to advancing image-recognition technologies. In fact, because Picscout has already fingerprinted and indexed most images from all the major stock agencies, as well as the larger microstock sites, they could examine images on commercial websites and instantly calculate the ratio of images that came from a stock agency versus those that don't.

Remember, I'm not trying to find the number of images that are stolen, or that come from pros vs. non-pros. I'm only talking about the number that come from agencies.

If it turned out that, of all the images found on commercial sites, only 10% were known to come from stock agencies, it would turn the entire industry upside down. It would change everyone's perception of agencies' influence on everything from licensing control to price controls to how people promote themselves, career tracks, and most important of all, future investment. Attention would immediately be diverted to the question of where does that other 90% come from? Sites like Flickr (Yahoo) and other photo-sharing social networks would have representatives from major investment firms and stock analysts looking to buy them lunch and ask a few questions. And of course, execs at Getty would be getting phone calls as well, asking, "where the heck are you?"

So, then I get this email:

...Your suggestion that PicScout could put to rest the provocative question about what proportion of licensed images come from pros is a bit off. First of all, PicScout is hardly an objective source. It's sole source of income is from stock agencies, who themselves would not like to see such information become public if it turned out to be true. It'd be like cigarette companies agreeing to let its medical research data be released back in the 1960s. Second, even if PicScout were to do research, it's not like they're equipped to do objective research. Their list of commercial sites to search are carefully chosen to meet the objectives of their clients, the stock agencies. Are they looking at sites that are known to use agency images so they can be tracked and billed in an automated way? (PicScout's website says they do image tracking, which isn't entirely for the purpose of finding infringements.) Then there's the credibility of their image-recognition itself. There is no published information on false positives and false negatives. There has been no public scrutiny of PicScout's technology, unlike Google, for example, where objective observers can look at search results side by side with Yahoo and Bing.

Be careful of what you wish for: if PicScout were to actually do a survey, their results would be believed, despite these problems, and you would have a very steep, uphill battle, trying to dig your way out of this tainted study because the photo blogosphere would have a field day with you.

After this, the discussion went to the phone. He said that his company has financed research in the same areas I've blogged about: the trends of photo-based ads in magazines, pro-level camera sales, spot interviews with design firms, etc. And they have come to similar conclusions I have about the total size of the photo industry. But tackling it is very hard. It's not like finding a secret gold mine. Once anyone takes a new direction on the internet, all eyes are watching. And since this is only an area where a big player can go, no one wants to move till they know they can be way ahead of the pack when the others notice.

This prompted me to ask, "if you're speaking so bluntly to me about this, aren't you worried about word getting out to the existing stock agencies and other industry players?" To that, he pointed me right back to my own blog post, The Economics of Controversy: "there are just too many players with a vested self-interest in keeping things exactly as they are." He said, "You love talking about behavioral economics, and the stock photo industry is a researcher's dream. No one in the existing industry has either the technical or financial wherewithal to tackle a $25B market, but chances are, they will be quickly swallowed up and made small divisions within much larger companies that know how to scale up."

"Oh really... like the music industry? It's not as though they're dealing with the internet all that well," I replied.

To which he replied, "yeah, that's why everyone's scared to get started until they know they can avoid that problem."

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