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, June 30, 2007

Time Lapse Photography

The emails I get.... Ok, so in a recent posting I mentioned I was interviewed. (The link is here.) And in that interview I made a very brief reference to the fact that I did time-lapse movies with my still camera. Well, of all the email I got about that interview, I was surprised at just how much people were interested in what I did with it.

So, I decided to shoot a new one. Last night (friday, June 29), I spent a couple hours shooting the fog and the golden gate bridge. I spliced it together into iMovie, added a song I recorded back in college (that I still had on cassette), and, well, here ya go. (The link to the video is here.)

Oh, and PS: It looks much better on my 23" cinema display :-)

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Wednesday, June 27, 2007

Making money from your stolen images

Ever had a photo stolen from your website? Did it make you angry? Did you feel violated? Did you feel powerless? Are you apprehensive about putting your photos on photo-sharing or stock-photo sites because you fear the problem would only be worse? I know it'll sound like a shocker, but you may be sitting on a small pot of gold. To explain why, you need some background.

Think about this scenario:
A web designer is making a web page for the corner hair salon, and there are two images to choose from: one costs $1 and the other cost $349. If the web designer was going to steal one of the images, which image do you think that person would choose?


Most people would say the $1 would be stolen. Why? According to studies repeated in various contexts, a similar theme underlies most acts of theft: the decision to steal is driven primarily on the perceived "consequences." An article in the Journal of Applied Social Psychology showed that the lower the perception of consequences, the likelihood of stealing is pretty equal among genders and racial backgrounds. Innocently taking a small candy at the checkout counter is something most everyone's done at one point in their lives simply because the consequences of the act are very low. It is only when the perception of the consequences go up that the true risk-takers (poor single men under 25) are more likely to steal.

Consequences
What does this have to do with photography? In my hypothetical question about the web designer, most people would assume the $1 image would be stolen. Whether you're aware of it or not, your "intuition" guided you to that assumption because the perception of consequences is lower because the value of the image is lower. Which is also the same rationale as the thief. Odd, though it may sound, this is totally wrong--people attribute stealing images to stealing other things, or for other kinds of crimes or mistakes. Consider one of these two scenarios:

  1. If you break someone's window with an errant golf club that mysteriously flew out of your hands only seconds after the ball itself landed in the sand pit, then the owner of the window is entitled to "compensation" to cover the cost of fixing it.
  2. If you get caught stealing a candy bar from a store, you have to pay for it.


The common theme here is "compensation based on the value of the item." In law, these are called "compensatory damages" because you, the evil-doer, "compensates" the victim for whatever you did--broke a window, or stole a candy bar. Hence, stealing a $1 image is perceived to have lower consequences than the $349 image because people don't know of other kinds of violations.

Thing is, stealing an image is not really against the law, so much as using the image is. It's like saying that falling off of a tall building doesn't kill you--it's the sudden stop that does. So, stealing the image isn't what gets you into trouble, it's putting it into use that does. In this case, "copyright infringement." And here's the part most people don't know: the law on infringements does not specify compensatory damages, but statutory damages, which is a very big difference indeed.

To illustrate how big, there was an article PDN reported on November 20, 2006: Corbis Settles With TemplateMonster; Wins $20 Million Judgment From Mystery Companies . In short, TemplateMonster stole a bunch of images from Corbis and used them as background images for "templates" that were sold to web designers who would use them to create web pages. The reference to the "Mystery Companies" in the article title is that other people and companies were involved that were either difficult to track down, or impossible. (Turns out that the companies were empty shell organizations.) Still, Corbis had a nice windfall from those they did identify.

When the article came out, photo forums were abuzz with scorn for the notion that photos were stolen, and fear began to circulate that their images would be stolen too. Many even proclaimed they were going to remove images from social photo sites and microstock sites because they can be easily stolen.

My immediate response was "Huh? Didn't you read those headlines? $20M! that's an 'M'! You're kidding me, right? Remove your images from stock sites? Hey, sign me up! Steal my images! Please!"

And that's when I started putting the pieces together and realized something may be going on in this industry that I hadn't considered before, which started me on a long-term hunt for stories, tidbits, interviews, and of course, legal research into the dark world of copyright infringement. Or, should I say, very lucrative world... for the copyright holders.

Statutory Windfall
In "statutory damages," the fine is based on an entirely different formula, irrespective (usually) of the actual "cost" of the item (or, in this case, the license fee). In fact, in the case cited above, the judge awarded Corbis the maximum amount allowed by law: $30,000 per image, plus $2,500 for each act. What's more, the court may (and usually does, according to statistics of such violations in court records) also award attorney's fees. In other words, you not only get the money, but the infringer pays your legal bills.

How much would the images have cost the company if they licensed them legitimately? It's hard to say given the company and the number of photos used. But, suffice to say, one could license the same kinds of images on microstock sites for $1 to $10 each.

And that's where you start hearing the click of light switches going off in some people's heads: if you knew you could gets tens of thousands of dollars if a kid stole a $1 candy bar from your front counter, there may be a lot of money if you put a lot of candy bars out for hungry children to take, especially if you make it very easy for those kids to take them, and especially if those kids have no idea of what the penalty is, and even more especially if we're talking about adults working at businesses that all bear super-size responsibilities.

So what does that mean for photographers and for photo agencies?

Opportunities for Everyday Photographers
I recently got this email, which is similar to a constant and frequent stream I get on an ongoing basis:

On Jun 25, 4:24pm, jrus424@msn.com wrote:
Two of my photos were lifted from Flickr and are currently being used on a hotels' website (w/o authorization). Should I take any action? My photos on Flickr are all rights reserved but others have told me to just forget it.


I get so much of this, that it's staggering for reasons that will become clear soon.

First, let me point you to an invaluable resource: The website for the US Copyright Office. This link is a well-written, easily understood list of the most common topics about copyrights that can be understood by most anyone, including photographers and even those who work for our own Attorney General.

Statutory awards can range from $750 to $30,000 per infringement, or even be as high as $150,000 if the infringement was willful or intentional. (Sound effect of Vegas-style slot machine bells going off.) To determine your situation, consider these two steps:

  1. If you have registered your photos with the copyright office, you can sue for statutory damages, and even recover your legal expenses.
  2. If your photos have had a visible watermark on them with your name and/or copyright notice, then the act is considered willful and intentional.


If you have done one or the other of the above, you should find a lawyer specializing in Intellectual Property and start letter-writing. Don't contact the hotels first--you don't want to say anything that may make negotiations harder for you later. Make a screenshot of the website that's using your photos for archival and legal reasons, then shop for lawyers. (If it's printed matter, just make copies.)

If you haven't yet registered your photos, or put watermarks on them, do it now. While it won't have an affect on this case, do it for future cases. And always do this for new photos you put online. Soon, the copyright office's new online system for filing your copyright registration will be available, which will make the whole process easier. Details on their website at http://www.copyright.gov/eco/index.html.

Even without having registered your photos, you could have a lawyer file a claim, but the likelihood of a recovery is less certain, and will be considerably lower. According to the law, you still own the copyright, but unregistered images that have been infringed are only subject to "compensatory damages." That is, a $1 photo can recover $1. The hotel's lawyers are going to look at the two points noted above and realize you've got a harder case to prove. Still, if your lawyer is good, you might eek out several hundred, especially because most larger companies don't want stuff like this hanging over them. Your mileage may vary, but it does mean that your lawyer is going to have to do the cost-benefit analysis of time vs. money recovered (since he's the one doing all the work).

If you do not plan on filing a claim, you could try to contact the hotels and state that you "will" a file a claim unless they want to settle early. Here, you risk having your bluff called.

In fact, this is what I did in my early days, and I found that some paid, others didn't. Big companies were more likely to do so, and to pay better; little companies usually said, "Go ahead, sue us." In the end, the time and energy were draining, not to mention the constant, distasteful "conflict," which made the whole practice... well, not to my liking. Perhaps it was because I was doing this without a lawyer, but also because I was making far more money dealing with honest licensees, that I didn't really want to pursue the thieves. And let's be honest: you grow your business by working with the paying clients because they turn into better paying clients. Catching thieves may be morally rewarding, but it doesn't "grow" your business. Of course, it's a great side-business for an existing business, if your sources are such that you can have these lawyers working for you on the sidelines.

Recently, due to finding just one-too-many infringements of my own images, and inspired by Corbis' windfall, I finally got around to using a lawyer to do this work for me. And, because I have registered my images with the copyright office, and because I have my copyright notice on all my photos, I have a "slam dunk" shot at every single case I bring forward. (It's more slam dunk than the last time that phrase was used back in 2003, but we won't get into that now.)

Although I'd implied there are pretty substantial awards to be had for infringements, "common" violations by smaller companies and less serious uses probably yield much smaller payoffs that may range from $2000 to $5000. Given my own back-of-the-napkin calculations of the bona fide infringements of my images that I currently have documented, I could add another $70-100K to my bottom line.

In determining my bigger opportunities, I used Yahoo's site-search feature that lists about 90,000 sites that link to mine from around the web, 5000 of which use my images and link back to my site. Some of them are personal web pages and such that I wouldn't pursue, but imagine the number of image uses that do not link back to me and that use my images. Simple math would suggest that if I got 1000 violations at $2000 each, that's $2M. Not a bad kitty for a single photographer. (Suddenly, my company's valuation is higher.)

The Hurdles
So, if it were that easy, why doesn't everyone do it? One stumbling block is that it's hard to find the violators. Sure, I've done brute force Google searches and found many violations that could be worthwhile, but it's very time-consuming. The real business opportunity is if you can automate the process so you don't spend your time doing it.

In fact, there are some companies that currently do just this: http://www.ideeinc.com, and http://www.picscout.com both have image recognition software (that they have each respectively patented) that can find identical matches for photos, even if they've been rotated, shifted, colored, cropped, or mangled in many ways. The process is simple: they first analyze all your photos by doing an analysis of the pixels and coming up with a kind of "fingerprint" ID. Then they crawl the web, or look at printed material (that they scan) and generate reports for where your images are found.

Sounds great, right? Here's where the next hurdle lies: it's really expensive and time-consuming to crawl the web. So much so, that the resources necessary to do so are so prohibitive that the fees these companies charge eat away at your bottom line. This, almost to the point where, again, it's still more cost-effective to let the thieves go and just continue working with the honest people. (Actually, there's a cross-over point where the number and nature of the violations is high enough that it becomes worthwhile.)

With their limited resources, it takes months and months before actual matches are found, largely because the searching algorithms are rather dumb--they just search randomly. As a human, I can make more intelligent searching decisions, like going to images.google.com and searching on keywords that I know will match my specific images. And true to form, I can usually find several infringements if I put the time into it. But again, there's that time thing again. Too bad those companies don't use more intelligent search methods to come up with more likely matches.

Why don't they? To do so, you have to have already crawled and index the web before searching with keywords makes sense. This begs the question, why not just crawl google's already-indexed search results? Primarily because they are not allowed to. (Google once had an API and an agreement mechanism available to do this, but they've since terminated the program.) So, these visual-search companies crawl the web like "ships passing in the night." A very foggy night with no compass or GPS.

So, although the small image-recognition companies have really great technologies to find the matches, that's not the barrier to entry. It's the mere indexing of the web. Once you do that, the image pairing is simple. So much so, they could probably find all copyright infringements by all photographers in a matter of a few days if they were only allowed to churn through Google's warehouse of data.

Hold onto that thought for a moment.

Opportunities for Agencies
What about agencies and/or photo-sharing sites? Flickr hosts hundreds of millions photos--let's round it off to 1 Billion images. If .1% (one tenth of one percent) of these photos had infringements, that's 1 million violations. Even a low estimate of $500 per violation yields $500M. That's a half a billion dollars. And think of what that would do to sign-ups at Flickr, not to mention Yahoo!'s stock price. People would be Flocking to Flickr! (I've been dying to use that expression.)

Best of all, that barrier that plagues me and everyone else doesn't apply to Flickr because they are owned by Yahoo!, who's indexed the entire web. They could very easily scour the web at the blink of an eye.

Suddenly, the business prospect of Flickr is more interesting. I've said before that Flickr should enter into the licensing business directly, and while I still believe that to be a rosy picture, it's even rosier if you add their natural ability to police infringements. Best of all, NO ONE ELSE COULD COMPETE WITH THAT! (Sorry, I hate using all-caps, but in this case, it's warranted.) They would literally corner the market in stock photos by simple virtue of their back-end infrastructure and existing photo assets.

Nevertheless, would Flickr ever do it? Sigh. Not anytime soon. The New York Times has had daily articles about how Yahoo! is imploding faster and faster: they're losing their vision, having serious upper management problems, and all business units suffering for money, resources, and personnel. Rumor has it that are executives waiting for stock and options to vest (so they can leave). Each business unit within Yahoo is choking for air, and Flickr is not anywhere near the top of the pecking order. So, no, I don't expect to see anything "new" from Flickr, let alone anything innovative, until the bigger company gets it house in order.

This then leads to Google.

Would they get into photo licensing? Not without acquiring a pretty big player, and that isn't quite likely, mostly because the photo industry isn't perceived to be important enough because even the biggest players are having problems making money. (This is a topic for another blog article, I promise.) Given Google's size, this article alone wouldn't even get past a receptionist's desk.

On the other hand, Google does have interest in the social side of photography through its Picasa products, so while we might not see much in the way of photo licensing, it's not totally inconceivable they could be interested in the photo matching game. Why not: it would be a natural fit for their general offerings of search tools, too.

Yet another potential benefit might be its own public relations boost. Google has been the target of many copyright violation claims, ranging from very public ones, such as the YouTube case involving Viacom, all the way to publishers and universities whining about Google's project of scanning books and documents found in libraries to help make the world more comprehensively indexed. Though none of these claims are sticking, simply introducing a mechanism that helps people find "exact matches" of photos on the net could be precisely what the Public Relations doctor ordered.

But, again, there's been nothing even hinted at about Google blinking in this direction, so for the moment, the aforementioned image-recognition companies (Idee and Picscout) have a long time to try to build their businesses without being usurped by major players who could take them out with a flick of a switch. (Oh, and add cognisign.com to the mix: they have great visual-recognition technology as well, but have already expressed no interest at all in pursuing a business in tracking copyright violations.)

Returning to the viability of image-recognition companies, one might argue that image matching is not that hard--or rather, not hard enough to command a secure role as the "leader" of the industry, because the real barrier is still the searching/indexing of the web. Whoever figures that out will be the clear winner.

The other side of the coin
For the sake of argument, let's say Google or Yahoo unleashed a simple mechanism in their image search that says, "find all instances of this image on the net." Click it, and you instantly see every page that uses that image, or portions of it. If you're a photographer, you've just found all (electronic) infringements. What would such a world look like for photographers and agencies, and how would it affect the stock photo industry?

The cynical view would be that the major agencies are really playing a baiting game, and this would pull the rug right out from under them. If they are selling cheap candy bars to kids who they know will steal them, the game will be up. Well, not immediately, but quickly thereafter. The availability of instant search results for infringements would generate a huge influx of money for copyright holders, but quickly evaporate as it became so ubiquitously known what was going on. It'd be like having a police cruiser sitting at every stop sign in your city. There would be a huge inflow of revenue from traffic violations at the start, but within a day or two, there would never be another violation again--people would just know the cops are sitting there.

The less cynical view is one that reflects more of what we're seeing in the licensing world now. For example, Getty's images are so easy to "copy" because the licensing is based on the honor system, but it may be for reasons other than to "entrap" users into infringements. I have personally spoken with many of their clients who tell me they use Getty images all the time for short little pieces without paying for them because they feel justified. This was how the candy bar analogy came up: a client said to me, "Getty will look the other way if I steal a candy bar now and then so long as I do my major shopping at their grocery store. If you did the same thing, you'd get more big buyers like us, too." I wouldn't do it, but not because I didn't believe in the strategy, it's because such a strategy only works for a large company like Getty. It doesn't work on small scale operators.

If the "search switch" were turned on, what would that do to Getty's business model of "give a little away so you can collect the big clients." And therein lies the real question: do you pursue your violators for large sums of money? What if they are also spending large sums in groceries? If they aren't, can you convert them? Do you take the short-term win (of pursuing infringements) at the expense of potentially alienating your clients and long-term growth? And what about the photographers the agencies represent? Whether Getty or a microstock, if they don't pursue infringements, then they can be a contributory infringer. (I alluded to this in an earlier blog about Flickr's liabilities in this area.)

Making it even more complicated is the inherent value of having your images stolen in the first place. In fact, Viacom's claim against Google's YouTube has generated a stir by television industry analysts, as well as within the walls of Viacom itself: the fact that TV shows are available online has actually helped viewership, and thus, increased advertising rates for those shows. Speaking of my own experience, the fact that so many sites use my images and link to me is one of the main core reasons why my site ranks so highly, which is what brings me the traffic that converts to buyers. So, a little copyright violation can actually do your business good.

Converting a criminal into an honest buyer is warm and fuzzy, but what about the tactic that made them a criminal in the first place? It'd be interesting if a defendant actually tried to use the legal excuse of the attractive nuisance doctrine. "They don't prevent me from downloading it without paying for it! It's too easy! I didn't know! The rules are cryptic." That's hard to say, and perhaps somewhat of a stretch, but if that magic switch were ever pulled by a search company, and thousands upon thousands of copyright infringement cases suddenly came up, the courts would have a lot on their hands.

Suddenly, the business aspect of copyright infringements isn't so cut and dry.

On the darker side again, there's this:
in an article by Bug Shell, Getty purchased the negatives to the National Archives, and is now on a litigation spree against those who use those images, regardless of the fact that owning the film does not grant ownership of copyright, and the fact that the photos are in the public domain. Getty claims that their "scanning" of the negatives (dusting and other corrections) creates a "derivative work," but many legal observers are taking great exception to this claim.

And the industry pendulum continues to swing back and forth.

Summary
The net-net is there's big money in copyright violations, especially if photos are registered with the copyright office and they are watermarked. What keeps this from becoming a more prominent figure in the industry itself is two-fold: the lack of awareness of how lucrative it can be, and the "resources" available for tracking the infringements in the first place. But, like anything that has the potential for money, there will be those who start down those paths to see where they lead. For those playing the home game, keep in mind that the issues faced by agencies are not shared by individual photographers. That is, while an agency may have business risk by being too aggressive in pursuing violators, individuals certainly do not. Even as I type this, yet another email has just trickled in from another concerned photographer, "I'm going to take my images off Flickr because I don't want them stolen." My response to him will be to read this article.

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Monday, June 25, 2007

Links to a postcast interview with me

I was recently interviewed for a podcast, so I thought I would share the link to it for those who are curious about my background, how I got into photography and how I was inspired to write about it. I also address many other topics of the photo business world.

Be warned: it's 55 minutes long!

The link to the site itself is on Jim Goldstein Photography Blog.

The link to the podcast itself is on EXIF and Beyond.

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Friday, June 15, 2007

The "meta-stock" agency.

There's an interesting new business model emerging that I've taken notice of that so far doesn't have a name, so I named it a meta stock agency. This is where a website mines the photo assets of one or more photo agencies or social-networking sites, and licenses those pictures. The idea is rather obvious--it hopes to act as extensions to microstock agencies by helping them sell their photos in exchange for a slice of the pie.

This model is not to be confused with a different business model that I proposed in my blog titled, The Virtual Stock Agency, In my model, members from within a photo community (say, a microstock) would be able to make their own business by acting as editors of the site's raw photo content. They would, in essence, act much like a regular agency by creating packaged products or services that would help sell the underlying photo assets. The economic incentive for virtual agencies would stimulate more sales than what current microstock sites can do on their own.

What's the difference between a meta agency and a virtual agency? It's the business model. Neither actually hosts images--they get them from other existing photo sources. While a meta agency may "access" photos from one or more sites, it does nothing more than present the same search results you'd get if you did the search on the original hosting site itself. By contrast, a virtual agency implies human creative effort (as described in my blog) that promotes photo sales beyond what the hosting agency can do on its own.

(PhotoShelter has a program on their site called The Virtual Stock Agency, but it's nothing more than multiple photographers contributing to the same account on the site. My definition is an entirely new business model.)

There's no conflict between a meta agency and a virtual agency; in fact, a company can be both. The "meta" aspect simply indicates that the photo assets my come from many sources, and the "virtual" aspect defines a business model that involves "productization" --that is, converts the "raw material" into something that helps it sell better.

We haven't yet seen either on the web yet, but we are seeing several meta agencies emerge, as I'll enumerate soon.

Let's begin by understanding how a meta-agency works. For a site to access photos from another site, it needs a way to get them. That part's easy. Flickr, for example, has a set of network utilities that allow programmers of other sites to access its content, which, till now, has largely been to demonstrate that it's "possible." There are various sites that pull Flickr images and present images that have certain characteristics, image features (such as colors), "popularity" values, and, of course, boring old keywords. The discussion board on Flickr's site for these users is humming with tech talk about cool things to do, with links of cool sites that pop up every day.

Many photo-sharing sites have public access methods that programmers use to access their photos--in fact, "programmer access" is the hot new buzzword in the social-networking industry, ever since facebook.com introduced theirs, and by consequence, is about to bypass myspace.com in visitor traffic. Giving outside users powerful tools to access data in your site is proving to be the next big wave in the internet.

So, while there are many sites that access data--and in this case, we're concerned about photos--what classifies a site as a meta-agency is the fact that it also sells those photos (ie., licensing). Combine this possibility with the rapid growth of third-party access to those photos, and you have what will ultimately be a major hub of economic activity in the photo industry. And while that sounds enticing, the business of a meta agency comes with some difficult problems that can affect everyone in the industry. So read on.

Three Meta-Agency Models
There are several different types of meta-agencies emerging, as listed below:

The meta-search site.

This simplest of the three performs a search of user-input across a number of different photo sites, and sends the prospective buyer to the hosting site. In a previous blog, I mentioned a9.com as just such a company, who've been doing this for quite some time. Currently, they don't have a business relationship with the sites they send visitors to, but it's conceivable that they could (if their traffic became a significant factor).

The meta-agency (Meta-search plus fulfillment)

This involves doing the search defined in (1), but also complete the license transaction on behalf of the hosting site (in exchange for a revenue share). www.picturesandbox.com (used to be called "flickrcash.com") is such a site. It lets you search for images from sites like Flickr, Smugmug, Lucky Oliver, YouTube and other social-networking sites. But, unlike the sites that it pulls its images from, picturesandbox will actually let you license the pictures returned from your search criteria. To be precise, they don't really license photos, as they do not have a relationship with the photographer. They sell "license documentation," as Dr. Augustine Fou, CEO of the company, explains. "We are the notary (date and time stamp from NIST Atomic Clock) and we are the digital document archival service." In other words, if you use an image that falls under the creative commons license, you don't really need to "license it" from anyone, but Dr. Fou's business will generate and archive an electronic document of the otherwise-public license as proof that your use of the image is "legitimate." This, to protect you in case a claim were ever made for copyright violation. The fee for this documentation archive: $9.99 per image.

(Personally, I've never heard of a need to actually do this, but I suppose it doesn't hurt if you feel it's a fair price for the service.)

Clearly, this is a new business, so their revenue structure is likely to evolve beyond just archiving documents, but it does represent a pioneering effort.

License the search technology itself

In this case, rather than doing (1) or (2), build the technology to mine the photo assets, and then license it (in whole or part) to other companies, either the stock agencies themselves, or sites that want to be meta-agencies. This business follows the more traditional software license model. One such player in this area is www.xcavator.net (careful not to use the 'e', as in 'excavator'). Like the others, they mine photo assets of other suppliers, but not using their published access methods. Instead, they only partner directly with photo agencies--so far, they are working with PhotoVault (and looking to expand their but only partnerships with other photo agencies, not photo-sharing sites). In their case, they're trying to promote the value of their image-recognition technology and build more of a B2B relationship. I'll get back to Xcavator later.

Where's the beef?
So, what does all this mean to the industry? What value-add do meta-agencies serve that make them better destinations than the original hosting sites? One potential and obvious one is that sites like Flickr that don't (yet?) license the photos they host. So, the value-add could be the ability to do just that. But other hosting sites, such as existing microstocks and others where users can already license the images found there, the value-add is less obvious.

In purely economic terms, the need for some sort of middle-man in the supply chain is clear. Photos are still considered "raw material" purchased in the same ad hoc manner as an auto mechanic who goes to a junkyard to find a part for a car. Need a radiator cap? Or just a photo of a radiator cap? Go to your local heap of crap and start kicking through it.

So, the business opportunity for a meta-stock is ripe. But, that doesn't guarantee success. This model is littered with all sorts of gotchas along the way, and navigating through the mine field will make or break all these players.

At the forefront of all this is the pivotal question: does a meta-agency help find photos better than the sites that already host them? Or do they just contribute to the flotsam? It may be too early to say for sure, but one thing is clear, players are stepping to plate to see if they can pull that sword out of the stone.

Because they are young, current meta-agency sites do little more than return exactly the same search results that the hosting site provides in the first place. If the user does a search for "future," the image results will only be those photos that the original hosting site determines is a match. What the meta-agency does with those results may vary, but it has to start with the initial set of pictures it was sent in the first place, which might be pretty poor. This goes back to an earlier article I wrote a couple months back about the perils of bad keywording habits by end-users. A meta-agency can't do better than the search results it's been given (and which it got returned from the image hosting site).

Xcavator's approach is unique in that it embeds itself into the hosting site's search mechanism itself. It can act either as the search engine, or operate along side it. Xcavator's claim to fame is visual-recognition, not keyword search, though it can do that too. For example, you can select a photo of a woman or a train, select artifacts of the photo that you want, and you'll be given a set of images that have similar artifacts. Skin tone, racial features, color combinations, window trimmings, shapes, etc.

Cool stuff, to be sure, but the question is whether this kind of search translates into more sales. And if so, how much more? For a photo agency (large or small) to afford to share its minuscule margins with a third-party partner, the additional revenue must offset the cost of the relationship. As it is, margins are too thin to spread across multiple links in the supply chain, so this is a high bar to clear.

As Shakespeare's would say, "Therein lies the rub." So, the economic challenges for meta-agencies are two-fold: 1) to actually provide a technically useful solution, and 2) to make it economically viable for a photo-hosting company to partner with it.

The second case is a problem now, but not for the reason everyone thinks. That is, most people believe that competitive market pressures have kept photo prices low. But that's not the case. I've argued repeatedly that microstocks don't paint a realistic picture of what the market will really pay for photos, largely because they make the great miscalculation that the buyer chooses photo sites based on price. They don't. People come to a site because that's the site that came up in a photo search on a standard search engine. Mountains of data prove that 90% (or more) of buyers end up at a site because that's where their search engine sent them, and if they find what they want there, they usually buy. My own site is a prime example: I license images for hundreds of dollars per image (on average) for no other reason than my site happened to be the one people landed on when they did a search for a term in a generic search engine. If it were all about price, I wouldn't make any money, nor would Google be making billions of dollars selling ads to people who want to be found in search results on their pages.

If a photo meta-agency could generate more traffic than the photo-hosting sites themselves, that would make them a more interesting partner. But unless that happens, the same money is just spread around to more players, cutting the same size pie into thinner slices. This doesn't sound like a business model that will last very long. How you get traffic is the elephant in the middle of the room. But it doesn't happen because you have low prices. This means that a meta-stock site has to somehow find ways to generate traffic. While that's an obvious statement, the implication is that, unless they do, the future of the meta-stock business model is dim.

Does search translate to sales?
Of the three models of meta-stock that I described, which has the best opportunity to monetize photo content? Working backwards starting with the licensing model (ie., xcavator), it's my personal opinion that this approach is several years too soon because there is no real indication that their particular brand of search will both increase traffic and convert searches to sales. At least to the degree necessary to offset the cost of splitting the revenue pie into more and thinner slices. To justify sharing revenue with another players (such as xcavator), they need to present tangible data proving that conversion rate. Until then, the risk of that speculation is too high.

Make no mistake, I fully expect there to be in the not-too-distant future a very clear business case for investing in better image search. I've written about how a future differentiator between photo agencies will be the ability to come up with more relevant search results for photo queries than what are produced today. But that won't come in one big swoop, or in fancy visual-search fashion. It will be incremental, and the early steps will come as a result of 1) better keywording by users, and 2) a broader adoption of hierarchical keywording syntax to allow descriptive context to existing keywords. In other words, it's more important for photo searchers to avoid getting false-positives from search phrases, than it is to find precisely the "right" image from a set of 50+ otherwise identical pictures of the same woman. You'll know that we're there when a search for "dental bridge" doesn't result in photos that include a kid smiling with big teeth standing in front of the Golden Gate Bridge. Solving this problem will affect buying behavior more substantially in the short term.

When that problem is solved, future PR pitches will come in the form of "we'll come up with the images you need in fewer clicks," which will replace the ridiculous claims they use today, such as, "we have billions of images!" The only reason they still use that silly marketing line is because they have nothing else to say. It's like saying that Hostess Twinkies are "caffeine free!" Like that makes a difference to buyers! But, what else can they say?

(My longer discussion on this subject is found here.)

Hence, with all due respect to xcavator's search technology (driven by the brilliant patents developed by cognisign.com), it's "a solution looking for a problem." A tough nut to crack, but then, making money is hard, so what's new.

As for the second option--being a meta-agency--it has great promise, provided it does more than just lay a technical foundation for accessing and presenting the same photo data you normally get anyway.

The first option of just being a meta-search site that sends users to the hosting company is just as easy as being a meta-agency, but its main advantage is that it's simpler business model; the thinner margins are more than offset by the avoidance of the more serious issues that I'll cover next.

Stimulating Growth
A meta-stock agency "can" exist, but will it stimulate growth of the industry? Will it cause people to license more images? Will it help traffic? Does it raise the bar on how photo licensing is done? Does it address the user-participation objective? Are there other hurdles to overcome?

The user-participation objective is problematic for two core reasons. First, there are no "members" of a meta-stock agency, so the social aspect of photo-sharing and microstocks is completely removed. No one has a reason to go to a meta-stock agency, other than to search for photos. And no one (other than photographers and photo industry analysts) will know they exist unless search engines bring people there, or unless mass marketing dollars are invested into mainstream media. We know that won't happen, so that requires a dependency on search engines. Yet, they won't bring traffic unless there's content or interactivity or some other "thing" that gets people to talk or write about it. Since none of that is happening, what's going to contribute to growth? The first thing a meta-stock site needs to do is offer something to "do" other than just search for images.

Oh, sorry, you can do one thing: license photos. But that in itself doesn't attract users--it's the by-product of users having already arrived. Otherwise, it's just another junkyard full of the same stuff available at other junkyards... which only makes it harder to find what you really need.

Now, this is not to say the idea is bad, just ... embryonic. Having a site that gets photos from another site for licensing is not a business unto itself, but it could be a good platform from which to build other activities that actually bring the users and the effervescent "buzz." For example, my proposal for the Virtual Agency would easily fit into a meta-agency framework. Members sign up and create packages and collections of photos, and these would be unique because 1) they are comprised of content from many sources, and 2) they are hand-picked, presented, and packaged in a way that compels visitors to not just see, but to participate in the process as well. (Remember, they make money too, if they can get people to buy.) This not only brings a lot of people and traffic, but increases the likelihood that traffic converts to sales.

Legal Hurdles
We've established that building a meta-search site, or meta-stock agency is technically simple. And we also covered the financial hurdles associated with making the business case to potential partners that it's worth their sharing their margins with you in exchange for your services. But there's one more hurdle to clear: the legal liabilities. Who actually has the legal right to license the very photos being served? Under what conditions? What measures are taken to assure photo ownership and copyright? What documentation is there that the human who makes these claims actually exists? Who bears liability if something goes wrong?

To illustrate, I went to picturesandbox.com and searched for images I knew would match my own photos at Flickr. (I searched for "star trails.") Sure enough, they came up as expected. I then clicked the license button on one of my images, which allowed me to not only download the image, but granted me permission to use it.

If you don't immediately see all the red flags flying onto the field by all the referees, you're playing the wrong sport. As you might guess, I do not give Flickr or anyone else the right to license my photos. We'll get to that in a sec, but for the moment, the first issue to address is establishing the relationship between the photographer and his photographs. Or, at least, the photographs he submits. (Hint: they may not be his.) This, for both financial and legal reasons. Because of the meta- nature of picturesandbox and its polling of image assets from various sites, it has no idea whether the images it receives from the host are genuinely "available" for licensing. It has to trust entirely that the hosting site returns images that match a given search, and that the images it returns can be licensed. This raises the ultimate question of who bears the legal liability when something goes wrong, such as copyright violation (as illustrated in my earlier scenarios).

Granted, this is currently a bug on Flickr's side that's easy enough to fix, but imagine the huge legal liability they set themselves up for if images were actually released because they gave the wrong license attribution? If someone had gotten my image and used it in a high-profile manner, for which I sued them for copyright violation, someone's going to pay for that. This would eventually cause the defendants to point to Flickr.

Ok, so that won't happen anytime soon because they'll fix the bug that they give the wrong attribution for a photo's license status. But, this is only a foreshadow of problems looming ahead.

Let me state up front now that I'm going to continue these scenarios with a focus on Flickr, but this is not unique to them. It just so happens that their prominence in the market also serves as a model for others to follow, which means they deserve more scrutiny than other sites. But, rest assured, they are not being singled out here.

With that out of the way, let me continue with the scenario by adding one step more: my images are all over other Flickr members' "photo streams" (as are pictures from other users and other websites) because anonymous, ordinary people copy pictures all the time and put them on their Flickr pages. (yes, and on other photo-sharing sites and microstock sites, too.) These users could just as easily indicate that the (stolen) photo is available for licensing, even though they don't own the photo.

Now, remember, we're talking about licensing. For those who are engaged solely in the social-networking aspect of these sites, none of this matters. And so far, that's all that Flickr is. Right? So far, there is no official statement from Flickr, nor any notice on their website that I've found, that says they are actively engaging in the kind of business relationships discussed here. In fact, the specific terms of use for using their APIs (to access Flickr photos) says, "no commercial use."

So, what of those "stolen images" that Flickr is making available to other sites who are licensing them (assuming that this is legal)? If Flickr expressly forbids this kind of use with their API, then Flickr is absolved, and the meta-agency inherits two problems: first, they are in violation of the terms-of-use of the API, and they are also next in line for responsibility in the event that photos are illegally licensed.

Ouch.

There's no remedy for violating Flickr's terms of use other than going to Flickr itself and cutting a deal. That's unlikely as it would have happened long ago by now. The second problem has a solution, but a tough one to achieve: checking that the photos being licensed are actually owned by the people who claim they own them. Given that most members of photo-sharing sites are anonymous, and there's no way to contact all of them 'en masse', things suddenly look pretty grim for the "license Flickr photos" idea.

Now, if Flickr is engaging in third-party relationships like those described here, and it is knowingly allowing meta-agencies to use their APIs to access Flickr photos for the purposes of licensing, this changes everything. Then the issue of stolen photos becomes front-and-center for the company. Note again that Flickr is not known to be doing this. But other photo-sharing sites may be in similar situations, which means that it's important to follow the principles outlined here.

Alert readers may be thinking that the Digital Millennium Copyright Act (DMCA) specifically protects hosting sites like Flickr and smugmug from liability for copyright infringement. This is true, but under some very restrictive terms. Not protected is the selling or licensing of copyrighted material. The fact that commerce comes into play is what changes matters entirely. For example, Google is in a legal skirmish with Viacom in a high-profile lawsuit because copyrighted TV shows can be seen on YouTube. Google is protected by the DMCA because the photos are posted by end-users, and the use of that content is not under google's control. But imagine if Google posted on its site, "you can use our API to download videos and use them in commercial contexts so long as the person who posted the video says you can." Well, DUH--anyone that steals videos and who can remain anonymous will attribute unreliable license terms because they don't care. Raise your hand if you think a judge is going to allow Google to get away with that? The DMCA would never protect a site from that kind of activity, and this is exactly the problem that a photo-sharing site (like Flickr) would have right now if it engaged in business relationships with "meta-agencies."

Flickr's Complicated License Choices
In doing my homework on the matter, I contacted several of my usual lot of lawyers for opinions. Again, no one sees anything that would suggest Flickr is doing anything wrong at the moment (but what we don't know is critical here). And remember again, this article is not just about Flickr--I'm just using them to illustrate broader issues facing the stock and meta-stock business model.

That said, if Flickr (or any other photo-sharing site) were to get into the business of allowing third-parties (meta-agencies) to access their content, this ratchets up on the priority list the need to assure that members who submit photos are duly notified about what they're doing.

In looking at Flickr's "licensing attributions" more closely, which could (and do) look pretty similar to other photo-sharing sites, they say that "you should add a license to photos you have taken yourself," which is somewhat incomplete and rather misleading. In effect, Flickr is telling members to permit others to use your photos, even though this is probably not what the user really wants to do. If most users were aware that by doing so, they may be allowing others to profit from their photos without any renumeration back to themselves, they probably wouldn't allow it. Or, at least, they'd be upset that they weren't more clearly advised of it.

Flicker users can instead choose the "None" option for licensing, which is the default. This tells Flickr that you're not giving other people the right to use your images. The problem is that directly above that selection is the text that advises you to use the one of the "license" options if the photo is yours, thereby dissuading you from checking "None." What's more, an unsophisticated user could interpret the "None" option as one that places "no restrictions" on the use of images, which is not what that means. (The "All Rights Reserved" phrase goes over most people's heads.) In a non-scientific survey of family members, everyone assumed that you need to select one of the "license" options to protect your images in some manner. A better test of whether end-users really understand it is to assess the current ratio of users that selected one of the creative-commons licenses, and then change the text that "advises" what the user should do, and see how that ratio begins to change.

If it is the intent of the end-user to protect his images, a reasonable person (such as a judge), could be convinced that the average person would misunderstand the terms Flickr is presenting, which could make them appear less than virginal.

I'm no lawyer, and I cannot predict the actual legal arguments--or outcomes--of any case, but I have a pretty good business mind, and the larger point isn't the legal argument--it's the public relations mess for everyone. No one wants to license photos from a place that might result in their getting sued by photographers who claim copyright infringement, hell-bent on making someone pay dearly, all because they didn't really understand the license terms as Flickr presented to them. I'm guessing Yahoo doesn't want to spend their money on lawyers defending these things on an ongoing basis, even though they may be right in the end. This kind of fiasco affects everyone in the supply chain. Yes, including the meta-stock site that may be the innocent bystander in all this.

So, to solve this problem, any photo hosting site that intends to allow third-party access to its photos for commercial purposes can deal with these problems in several ways:

Disclose third-party license agreements to members.

While Flickr is tight-lipped (to a fault) about discussing any of its future plans vis-a-vis licensing photos, it is going to have a very rocky road ahead of it if it doesn't prepare for whatever future it may have by fixing up some of these matters now. It should make formal statements about whether it has engaged in such relationships with third-party entities that may be licensing photos, especially if no such agreements exist today. As a social-networking site, Flickr and smugmug and many others enjoy the full protection provided by the DMCA, but entering into business relationships that allow others to license photos is another matter entirely.

Verify identities of members who contribute "licensable" photos.

If a site is going to permit photos to be licensed (either by themselves, or through third parties), the identities of the owners of the photos need to be known before they are served to third parties. In addition, that person needs to warrant that he does, in fact, own his photos. Granted, people may lie, but at least it eases the burden of responsibility of the photo-hosting site if it can demonstrate that it has good, sound procedures in place, and that it takes the matter seriously.

Require users to specifically check a box for photos that aren't theirs.

The DMCA already requires sites that host user-generated contact to have a policy that provides methods for copyright owners to notify the company of copyright violations. So long as the site is a social-networking (photo-sharing) site, this is sufficient. However, if the company is also going to engage in selling or licensing this very content, it would be a good idea to have members voluntarily indicate whether they own the images they submit, which makes them subject to purgury if they lie. It's not illegal to upload photos you don't "own"--indeed, the vast majority of all photos on the internet do not carry any sort of restrictions, especially for use on photo-sharing sites. Indeed, many owners do, in fact, knowingly choose the "creative commons" licenses for their images, which permits anyone to upload them to other sites (along with many other uses). But a photo-sharing site that permits third parties to licenses its content can relieve itself from many future headaches if it simply offers the user the option of selecting a checkbox that indicates a photos isn't theirs.

Summary
The above illustrates simple, but important examples of how the industry is still very immature, and kinks like this need to play out before proceeding to the next evolutionary step.

The real challenge of making a meta-stock agency isn't the technology, it's making the site interesting enough to get users to participate and engage in it, so as to generate traffic. Equally important is working through details like photo ownership, copyright, model releases, and so on. My recommendations for dealing these issues are all found in many articles I've written on my blog, so I needn't rehash them here. The ones who succeed at the business will be those who know how to monetize those ideas effectively. For example, my recommendation to Augustine Fou of picturesandbox was to invite photographers to register with his site for an annual $5 fee, paid for by a credit card, which assures a user's identity and provides credible warranty that the photos that may come up in search results are their own. This not only dramatically minimizes the likelihood of getting fraudulent photos, but provides an accountable face to point to in the event of a legal problem.

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Thursday, June 07, 2007

My new book arrived!


Buy one here and get a free companion guide!


My Latest Book is Out!

So, you think I write long, boring articles, full of dense analysis of the photo industry, do ya? And I bet your eyes roll when your RSS feed tells you that a new article is ready. And you probably tell the office supply guy to go fill up the printer toner and buy a new ream of paper so you can print out my latest manifesto for the long commute home on the train, right?

Well, my esteemed colleagues in the photo field, that isn't going to happen this time. Believe it or not, I do have other, non-boring creative writing techniques that I picked up somewhere between the 7th and 8th grade, much to the dismay of the school janitor who had to clean it off the gym wall every other morning. In fact, I have dumbed down my writing to a level that even politicians can understand. I even went so far as to deliberately avoid words no more than 6 letters long, unless I had no choice, in which case, I reduced the font to make them not appear so big.

So, what's the topic of my new diatribe? By merely examining the graphic on this page, you may surmise that I actually take pictures for a living. And to that, you would be correct! Lark Books has humored me by agreeing to actually print the pictures I take on these fabulous trips other people foolishly pay me to take. The only thing required of me was to explain how I take pictures. What's my technique? How do I get these (ahem) fantastic photos that I sell for astonishingly and indefensibly large sums of money on my website? Well, now, you can find out.

And your brain won't fry when you read this stuff either. I don't talk about anything that has to do with money, economics, business, or nothin'. Just good ol' photo techniques. Specifically, travel photography. And best of all, there are pretty pictures to look at, too! From all over the world, no less!

Haven't had enough senseless marketing rhetoric? Then keep reading! Now you can obtain a copy (or two) for yourself or loved ones by ordering directly from my website using this link for the deep-discounted price of only ... wait, I gotta go look it up... twenty smackers! That's about twenty dollars for you non-American folks. Oddly, that's about the same price in Canada, eh? And you Europeans, you have no excuse whatsoever. You could be my entire supply for just a few Euro! And you Brits, our measly little dollar is hardly worth half your quid.

Whatever your currency, mere shrapnel is all that's required to learn valuable techniques such as composition, (not)using a flash, long exposures, star trails and night photography. Included are special, useful tips and tricks pasted up on those cute little post-it notes. (Notice: notes are not detachable.)

And talk about photos! There are well over 200 pictures that, if you were to license each one from my site, I'd charge you several hundred dollars each! That would make this book worth... let's see, that's 234 pictures times $364/each on average... carry the one... well, let's just say that it'd be a lot of money! What savings!

OH! OH! OH! And I'm not done yet! (Your eyes better not be glazing here.)

Available only on my website, you will also get a totally free Companion Guide. (Remember, "free" is not nearly as good as "totally free.") Yes, this little 36-page booklet is like a "cliff's notes" version of the longer book, making it perfect for taking along with you on those big trips where you need to travel light. Yours truly designed and produced this little booklet all by my little self during those wee hours of the morning while waiting for the next silly thing to happen in the photo industry that I could write about.

So, wait no longer, order now, and be the first on your block to have it in the recycle bin for thursday's pick up. Or, donate it to your local library. And be sure to tell your friends, neighbors, relatives and anyone else that is looking for a quick, easy gift to give that emerging photographer as a gift.

Now, pardon me while I go get more coffee.

Tuesday, June 05, 2007

Adobe Adopts Hierarchical Keywording Proposal

In April, I wrote an article titled, "keywording's role in the future of stock photography". The premise being that, once the dust settles around the large influx of new players in the stock photo industry, they will eventually have to compete with one another based on the quality of photo search results, not image quality. (There's plenty of "quality" to go around, despite the grumblings of long-time pros who may feel otherwise.) In my article, I outlined the scope of the problem, proposed a technical solution, and presented a business case for it.

To summarize it, search results are only as good as the data available to search on. People can add keywords to an image, but the search mechanism has to determine whether a search term or phrase is satisfied by those keywords. The problem with current keywording standards is that there is no syntax available to describe the semantics of a word. It's not just its actual meaning--a "turkey" is both a type of bird, and the name of a country--but it's also the words that modify its meaning. For example, if it were a young turkey, then "young" would be added to the list. The way keywords are defined today, all have the same weighting, thereby having no semantic effect on one another. If the photo also had an old woman with a hatchet about to chop off the turkey's head, then there would also be the keywords "old" and "woman." However, this presents the problem that the image is a valid match for the search phrase "young woman." This is what is called a false positive.

I proposed a keyword-binding character, such as the colon (:) or pipe/vertical-bar (|) character to associate one keyword with another. Hence, "woman:old" (or "woman|old") would be a single, semantically cognizant keyword, rather than as two unrelated keywords.

My article went on to say that for this to work, an independent company would have to support the idea by implementing it in their image management products. I'm excited to say that Adobe has just re-released their Bridge product, which is their image-management component of their "Creative Suite 3" product line, to support precisely what I had proposed. Existing users of Photoshop or other CS3 applications can use the Software Updates option to download the new version. To get hierarchical keywords, you only need to turn on the user-preferences switch. (The image shows my particular preferences.) That is, by default, selecting "Turkey" would have that word by itself assigned, but if preference for hierarchical keywording is set as the graphic shows, the single keyword "Country:Turkey" would be assigned.

An example hierarchical structure may look like the second graphic shown here.

So, now that it's out there, what can be done with it? What can we expect in the future and when?

For the moment, nothing. For this (or any other idea) to work, it requires both photographers and searching agents to adopt the syntax, and this may take some time. Setting up keyword hierarchies is easy with Bridge because most people have already defined image "sets" with older versions of the program, and certainly with the new multi-level hierarchies that were introduced with Bridge 2.0. The only thing necessary now is simply to turn on the switch and "rebuild" your image caches with the preference set.

The searching agents, which range from photo-sharing sites like Flickr and smugmug, to microstock and macro-stock agencies, only need to do one little thing: look for the keyword-binding character in keyword lists. Implementation can come in two stages: first, just be aware that it's there, and use it as a keyword-separating exactly as though it were a comma or semi-colon, which are already used to separate keywords into the existing "flat list" syntax in use today. The net effect here is that you're ignoring the photographer's hierarchy, but not losing any of the keywords. So, "Country:Turkey" just looks the same as if it said "Country, Turkey", which is a syntax you already look for anyway.

Later, you can build the hierarchies when you're ready to have more sophisticated search behaviors, such as prompting the user with the option: "For 'turkey', did you mean Country or Bird?"

I'd like to hear from anyone, photographer or agency, that has it in their plans to use this new syntax. Of course, I always invite email comments to my posts. I don't permit comments on my blog because it's far too time-consuming to monitor it.