It’s started when Royalty Free wanted to find an easier way to price images. Someone, somewhere ( history forget his/her name) suggested that images should be priced according to size. A bit like a bag of potatoes .  The bigger size, the more expensive.

Back in the late 90’s, that made perfect sense. To use a photograph in print, you needed a bigger size than for web usage.  And , since websites were poor experiments, that was fine.

Fast forward to 2011 :  Microstock , the irreverent child of Royalty free, has full embraced it’s elder’s pricing structure. A small file size is cheaper than a big file size.

That would be fine if the market had remained the same; But , it hasn’t.  With more than 14 million units sold in 2010, the Ipad has kicked wide open the door of publishing. At the recent CES ( Consumer Electronic Show), no less than 80 different tablets were announced. In the mean time, print is slowly choking under the combined weight of its rising costs and  growing irrelevancy. Websites are now starting to suck all available resources, including budgets.

In other words, the market for images is going 100 % digital. Which means that publishers, advertisers, designers need much smaller files. For example, an Ipad image needs to be 1028 pixels on the large size, at 130 dpi. No more. That means the markets is going to need more and more of the smaller files. You know, those that cost the less. To the point that the larger files, the XXL’s, might never get sold anymore.

Since Royalty Free ( microstock included) has made the wrong assumption that smaller image files were always going to be a marginal market, they are entering this new market totally under priced. They are practicality giving away the small file sizes in order to attract visitors.

If they were smart, they should reverse their pricing scheme. Make the large files the cheapest. But, for various reasons, that would never work. One of the most obvious reason would be that no one would understand why bigger is cheaper ( or smaller is more expensive). That is just not the way we think.

The second irony  is that cameras are also producing larger and larger files  while the market for images needs smaller and smaller files.

It is just a mistake to beleive that only editorial images are being affected by this shift to digital usage. Advertising will follow where publishers are going , as well as brochures, books and practically  everything else. Even billboards will end up fully digital. It is just a question of time.

The challenge of the next five years will be how to re invent the pricing structure in order to take full adavantage of this new demand, not only in pricing but delivery methods.

Author: pmelcher

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