Home » Royalties » Alamy Cutting Commission from 50% to 40% for Its Stock Photographers

Alamy Cutting Commission from 50% to 40% for Its Stock Photographers

5 December 2018

PG thought this item, relating to a rough equivalent of an ebook publisher in the photo world, was troubling and hoped indie authors would not find themselves in similar circumstances in the future.

From PetaPixel:

Alamy announced in an email to contributors today that the commission rate for stock photo sales is being slashed from 50% to 40% starting in February 2019.

Here’s what the email said:

In February 2019 the Alamy contract will be changing to reflect a new commission structure. The commission contributors receive for direct sales will change from 50% to 40%.

This email is to give you advanced warning of this upcoming contract change. You will receive another email in January 2019 signalling the beginning of the standard 45 day notice period before the new contract comes into effect in February 2019.

Alamy is a popular stock photography agency that, since launching back in 1999, has remained a private company through all the mergers and acquisitions that have occurred in the stock photography industry.

While it was originally known for offering a majority of each sale to contributing photographers (even as high as an unheard-of 90% in the beginning), Alamy dropped the 60% commission to 50% back in 2010-2012 citing a need to invest in R&D, new products and services, and new marketing initiatives.

Now the 50% commission is being cut further to a minority share of 40%.

. . . .

“It’s kind of a significant move away from where we have been historically, which is to be on equal footing with our photographers, and in fact our origin was to always pay the lion’s share of royalties,” West says.

West calls Shutterstock, Getty Images, Adobe Stock (formerly Fotolia) “tier 1” agencies with revenues north of $150 million. He places Alamy in the “tier 2” level with revenues of $30-$60 million, saying Alamy is essentially the only “tier 2” agency that’s not an outright microstock agency.

West also says Alamy started with the unusual approach of paying contributors a much higher royalty than anyone else in the industry, which brought Alamy early success.

“The thing that we got wrong — and I was pretty naive about with hindsight — was the royalty split,” West says. “I thought we could charge a fraction of that of our competitors and so we started it paying contributors 90% royalties with some transaction fees on top of that.”

. . . .

“If we hadn’t reduced the royalty as we did in 2010, we would not have been able to invest in the things that led to ultimately the results we’ve achieved in the last 3 years,” West says.

. . . .

After the change, Alamy will still be offering a higher commission than its competitors, West says, adding that he believes this may be the last commission rate drop Alamy will need to do.

Link to the rest at PetaPixel

PG suggests you may wish to view the video in the OP and read some of the comments.

PG’s observation is that the video is not reassuring for photographers and doesn’t reflect a proper level of preparation on the part of the presenter.

PG further suggests that the OP and video may serve as a caution for indie authors to be mindful about keeping their options for licensing and selling their books open to the greatest extent possible. All of the terms and conditions promulgated by Amazon and other online ebook publishers and/or distributors via click-to-accept agreements which PG has reviewed include the right for the publisher or distributor to change the terms of the business relationship, including the financial compensation for the author at any time, often without advance notice.

While PG is not an expert on royalty agreements between photographers and stock photo agencies like Alamy, his review of Alamy’s Terms and Conditions disclosed more than a few provisions which are, in his photographically humble opinion, not fair to creators. PG reviewed the Terms and Conditions appearing here.

If, as the video and OP imply, Alamy is (or has been) considered an enlightened photo agency, it appears to PG that photographers may be treated worse than authors are treated by traditional publishers in more than one respect. However, as usual, PG could be wrong.

Royalties

9 Comments to “Alamy Cutting Commission from 50% to 40% for Its Stock Photographers”

  1. Chokepoints will choke you.

  2. While I don’t things with Amazon are guaranteed right now, I do believe that once Bezos either dies or steps down from heading the company, things will definitely start changing for Indie Authors there. This, I think, is something KKR was obliquely referring to in last Thursday’s Business Musings post.

    Just because that isn’t the case now doesn’t mean authors shouldn’t be wary of it happening in the future, because such awareness will enable Indie authors to prepare to act in their own best interests.

  3. The greatest protection Indies can have in this regard is that multiple and strong retailers remain in the industry. As soon as the field begins to weaken and retailers start to fall by the wayside, the danger of commission degradation becomes more real.

    Many Indies swear by Amazon, but if Amazon sees any weakness start to develop in the industry (at least in the realm of self-publishing) they will lower rates. Take Audible’s rate decrease as an indication of this.

    The problem with Indies is that we are individuals. Each self-publisher has different goals and dreams. We do not have the power of a unified voice and we do not have the protection of contracts that serve to protect both parties.

    We have TOS agreements that put all the power in one party. That’s a situation that gives that one side too much power and leaves no room for negotiation.

    • @ A.R.

      “…we do not have the protection of contracts that serve to protect both parties.”

      Neither do trad-pubbed authors!

      • Trad-pubbed authors have the opportunity to amend the contract.

        They can have agents (whether good or bad) or can hire IP lawyers to represent them, argue against some of the terms in the contract, and make amendments to the contract.

        The ToS is a take it or leave it contract, that gives all the power to one entity, and that can be changed at any time for any reason the party with power chooses.

        No discussion. No reasoning. No bargaining.

        The only choice the indie author has is to accept or decline the ToS.

        • This is what you get with the disruption. Independents would never have the opportunity they do if Amazon treated them like individuals.

          Publishers dealt with authors on an individual basis. Someone read their book, edited it, made a cover, and marketed it. They may have been treated poorly, but someone actually knew their name.

          With Amazon, authors are just one of millions of vendors who use Amazon as their outlet. Amazon can’t deal with each of those millions as an individual. Vendors selling books, widgets, and pork rinds all face a standard contract.

          And there will never be a contract that serves to protect the interests of authors and Amazon. The supply of books is far too large for Amazon to have any need to do that. They are not competing for manuscripts. But zillions of authors are rushing to give them their books.

          God Bless the free market, for the literary ASIN shouts, “How high, Sir?”

  4. I’ve always thought that this Indie Thing was designed to end up with authors selling their own books, from their own eStores, to their own readers.

    Dan

  5. I’m an artist as well as an author, and I do occasionally use stock image sites to sell them. To be honest, all of them have issues, and the royalty rates are poor across the board. I’ve stopped posting them while reviewing the options of selling them myself. But, there are disadvantages to doing that, as well. Who knows, maybe someone who sees the need and has the organizational and programming chops will step in and start a service that will rattle those in power now. I would love to see it.:)

Leave a Reply