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

The photography world -- the business, the culture, the art, the politics, the technology.

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Saturday, August 13, 2005

Data Analysis and the Pro Photo Industry

The challenge of science is to be skeptical and always in search of truth. Indeed, this is a difficult task, because truth is more likely to be a very wide spectrum of grey than the black-and-white that people are more comfortable with. As it pertains to the internet's impact on the photo industry, "the truth" also shifts with time as the transition to digital/internet technologies continues to permeate other industries that use photographs. Regarding what the impact is of non-professional photographers on the photo industry is important, because it has a great effect on what role the photographer can play, and how to play it. If it were the case that non-pros have a more influential role than once thought, it could (and should) change how professionals do everything, from manage their own careers, to how they engage cooperatively or competitively with other pros.

This can be a difficult and painful prospect for most pros, especially those who have a vested interest in seeing things remain "as they are." As such, no one actually does data-gathering on the general population for its photo-related activities (as opposed to only photographers and agencies), because no one has a vested interest in seeing such data. Therefore, it is only possible to speculate what the consumer's impact is based on indirect data, which many of my other articles cover.

Indeed, the purpose of my blog is to present a more thorough analysis of a topic that it seems no one (in the photo industry) even considers as a possibility. Most skepticism, while understandable, is mostly based on traditional models that were indeed true for most of the history of this business. Yet, as I pointed out in another posting, such assumptions can be dangerous, especially in times when major changes are taking place. Very large companies have been brought down because of similar errors in judgement.

I wouldn't be bothered so much by skepticism if it were based on other data, rather than just a disbelief in the data I present. Note, it's not "my" data--I didn't do the data gathering. I am merely mining existing data from sources that current photo industry analysts don't look at because they don't think there is a correlation. I do see the correlation, and because of that, I can see some very interesting trends that are compelling in what they suggest. And, it seems, the more data I gather, the more it points to the same conclusions.

Yet, it seems my biggest hurdle is still within the community itself. Presenting this sort of material is the audience; it's as though I'm talking to the auto worker's union on the value of free-market enterprise. They don't want to hear it. They just want to hear how they can embolden their base to garner more concessions from management. If I were talking to a union, they'd be right. But photographers aren't a union, nor do they have the kind of clout that unions have.

To that end, you hear a lot about unionizing and forming cooperatives from photographers and industry groups. (Well, not so much about unionizing anymore--the Supreme Court put the kabash on that in the 1970s.) But the spirit remains alive. And, if photographers could ever effectively form cooperatives, there would be data that hints at such effectiveness. And, in fact, I have! For example, in 1982, the Federal Trade Commission stopped the ASMP from publishing price lists that members should charge their clients because it was deemed to be Restraint of Trade. What more compelling reason do you need to show how powerful a trade organization can be!

But that data was almost 25 years ago! Back when the industry was more insulated, when the barrier to entry (into the photography profession) was higher, the number of players was smaller, and the sources for imagery was more limited and tightly controlled. It was very clear that such groups could, in fact, act in unison and work in their collective interests. One could find all sorts of news and other data sources that supported the notion that such cooperative efforts were effective. But as the internet grew and others got more involved, such reports grew fewer and fewer, with each "win" becoming less and less advantageous to photographers.

So consider how the FTC would rule today if the ASMP tried to do the same thing. Back in 1982, 95% of all media photographers were members of either ASMP or sister organizations, and close to 100% of all newspaper and magazine photographs were obtained either through such photographers or agencies that used them. No wonder the FTC ruled as they did. Today? The FTC wouldn't even notice, let alone lift a finger to stop them. (And if the ASMP did publish their price lists, it would probably have a worse impact on photographers, because it would probably cause them to lose more business that would just be passed onto semi-pros or others who are more business-savvy.)

Sadly, the industry trade groups don't know that--they still look upon the 1982 ruling with bitter-sweet memories. The bitter part is that their claws were taken away. The sweet part was that they had claws. While there are still isolated incidents of gains here and there by their various industry-focused efforts, there are more reports of media and other sources going "outside" of the traditional photo markets for their material. To wit, there is this article about how the BBC website is going to start using reader photos:


Speaking of consumers, if there's any doubt about their ability to produce publication-quality photos en masse, consider this news report about how people are producing photos so good, that WalMart is not sure which are consumer prints, and which are professional:


At the end of the day, I am a photographer, and I care about the industry and how people perform within it. However, I am not a blind advocate that just waves the industry flag and supports whatever the conventional thinking is or has been.

In conclusion, the "facts" (I'd rather call them "data points", since all data is ephemeral at best, and subject to interpretation at worst) are already compelling: pro photographers are not in control of how their own industry operates, and there is nothing they can do as a cooperative to change it. In fact, those who try will find themselves worse off than those who use free-market strategies where competition is the path to success. The data today is even more compelling than what I had found 7-8 years ago, when I wrote my first article on the subject for EP mailing list. That was the truisms article I pointed to before:


Although I've bolstered the content of that article with more up to date and varied datapoints today, the conclusions I came to were the same. To succeed, photographers have to change their perceptions about the market, who's in it, the competition, how to market oneself, and most of all, how to price competitively. Indeed, that article generated the same controversy as my articles do here today. But to read the responses back then, you'd shake your head in disbelief. For it was in those days when I said that the web would be the new landscape for stock photography, and the then-golden-boy of the EP group literally said, "there is no future in photography on the Web--you'll lose everything because people will just steal your images."


Blogger Scott said...

As a freelance photographer who has built up an online stock photo business over the past couple years, I have found that Dan's "truisms" are indeed the closest thing to universal truths about this profession. It has been a struggle to find a market for my images and to build a profitable business, but then again, what entrepreneurial pursuit isn't difficult at first?

Probably the most difficult tasks for me have been marketing myself and my images, pricing my images and developing good negotiating skills. Early on I asked advice of other more established pro photographers and was told again and again to hold fast to premium rates, as if there was some rock-solid standard for pricing stock photos. Perhaps there once was before the internet and before digital photography and the explosion of online images published by pros and amateurs alike, but as Dan has shown, saleable images of almost every subject have long since become a commodity.

It's often just too easy for a potential customer to find a useable stock image elsewhere for less (or even free) if you simply insist on Fotoquote prices or don't somehow provide a better overall buying experience or service. When a product becomes a commodity, in order to survive as a business selling that product you either have to reduce your overhead and compete on cost and volume or you have to convince your customers that you're not selling a commodity product - you have to move up the value chain and offer something more than just that commodity product.

Having recently read Thomas Friedman's 'The World is Flat', I can definitely see how the photography world is getting pretty flat as well.

Friedman illustrates the flattening effects of the internet and globalization on such old and new professions as accountancy and web design. In the case of accountancy, whereas accountants and tax preparers have traditionally not had to worry much about competition for their services from foreign accountants, today they do. In fact, a lot of the basic personal income tax returns we hire agencies like H&R Block to prepare for us are now outsourced to accountants in India for a fraction of the cost of local accountants. So, in order to survive, your local tax accountant has perhaps had to go back to school to learn new skills, maybe now offering estate planning services, personalized services which are still difficult to sell and provide over the internet.

Similarly, when thousands, hundreds of thousands, even millions of competent and eager amateur photographers around the world can market their photos directly to photo buyers, you have to realize that that the traditional barriers to entry into the photography profession - cost and expertise - have been nearly flattened. And realizing this, one must change just about every aspect of doing business in order to survive and thrive.

Though it might now be easier to make a little money selling images, it's probably a lot harder to make a living at it. On the bright side, however, is the fact that the same globalizing and flattening factors which are making it possible for anyone and everyone to sell images are also opening up larger and more remote photo markets around the world. The trick might be to figure out how to better tap into this rapidly expanding market.

7:04 PM  
Blogger andy said...

Like many who read your blog and website, I would love to exhibit and sell my images more seriously as a pro or semi-pro. I think my greatest challenges are to a) figure out my "vision" (as you say elsewhere), and b) improve my technique (with both the camera and Photoshop).

As an impetus, next time I'm in the USA I would like to select a group of my images (that seem to represent a vision) and have them printed. That is, I want to work closely with a printer to have them looking at their best. Then I'd like to take this set of ten or twenty images and exhibit them in physical locations and for sale on my site.

Realistically, I don't see myself being supported by photography anytime soon. But I could see myself slowly to that point down the road. For now, the goal of all this is to develop a portfolio and the beginnings of a name for myself.

What do you think?

You once took a sample of your photos to see whether you had what it took to go pro. I know you're not recommending that approach, but if you have time...you can see the link to my photoblog below.

Before I stop, I've always wanted to ask if you exhibit photos at a gallery in Santa Fe. The first time I came to this site, I stayed because I was sure I had seen your Antelope Canyon shots before.

Finally, it's worth noting that the word "amateur" is based on the word "amor" -- love. Amateurs are a formidable force because of their passion.


11:11 PM  

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