Image Licensing: A Case for the Unpopular Route

Image Licensing: A Case for the Unpopular Route

There are two basic models for licensing photography. One is suggested by most professional photography societies and organizations while the other is decried as an unfair and unsustainable model by the same groups. For the past six years I’ve licensed my images using the unpopular model. In this article, I’ll explain why.

Rights Managed (RM)

The first model, the model that most professional organizations recommend, is the rights managed model. Using this model, the photographer stipulates where the images can be used, who can use them, and the duration for which these images can be used. If the client would like additional usage out of the images, they need to negotiate for further rights.

For example, using the RM model, ABC Architects hires me to do a shoot paying me a photography fee of $2,000. This includes the rights to reproduce 20 images on their website for 1 year.

At the end of the year, ABC Architects would like to keep the images on their site and are required to pay an additional fee, call it $1,000 for another year.

After providing the images to ABC Architects, the building contractor sees the images and would like to use them on his website. In order to do so, the contractor pays me an additional $1,000 to reproduce the images on his website for a year.

I’ve turned a $2,000 shoot into a $4,000 shoot without doing any extra work. It is clear to see why this model is popular among photographers.

Royalty Free (RF)

In the second model, the photographer is hired to do a shoot and the client receives the images with no usage stipulations.

Applying the RF model to my example, ABC Architects hire me to do a shoot for $2,000. In return, they receive 20 images which they use indefinitely on their website. At some point, they decide that one of the images would make for a beautiful advertisement of their design work and use the image for a print run in a national magazine. Because they have unlimited rights to the images, they are not required to pay me any additional fees.

Ultimately, what I can make from this shoot is capped at $2,000. At face value, the RM model is clearly the superior model. In the short term, I agree. However, over the long term, there is more to consider.

Quick side note: royalty free tends to be associated with micro stock. Please note that the licensing models discussed here have nothing to do with the price charged for photography. A royalty free model does not need to be a cheap model.

My Approach

I started a travel photography business about two years prior to my architectural photography business. My clients in the travel photography industry are multinational businesses that can choose from an infinite pool of photographers.

When I was first offered a shoot by one of these businesses, the contract I was offered was a "work for hire" contract. This meant that they paid for my time and owned an unlimited license to the imagery that I would create. The day rate that I was offered was significantly more than I was earning as a school teacher and they offered regular work, so it seemed to be a generous contract. As they were taking a chance on a new photographer, if I had refused the terms, they would have simply moved on to another photographer.

I’ve spent six years working under this contract. In that time, I’ve been able to support my family living in one of the world’s most expensive cities while also having the opportunity to travel to 55 countries around the world. My clients have enabled me to live my dream as a full-time travel photographer. I am exceptionally grateful to them and firmly believe my decision not to worry about managing the image rights paid off.

Interior architecture

An interior from the first shoot I did under my architectural photography business. Although the glazing was never the focus of the shoot, it ended up featuring in many of the images, making the images useful to the glass supplier.

When I started an architectural photography business, I decided to use the same licensing approach. Upon completing my first job for a client, I told them that they had unlimited rights to the images. As they were used to the RM approach, they were both surprised and grateful. It directly led to repeated business. After working with the same client for two years, he told me that the reason he kept coming back to me was that I made the process so simple. Before I started working as their photographer, it had been a nightmare keeping track of all their images and associated rights. Their preference for unlimited rights is based on simplicity, not budget.

Referring to the original example, using a rights managed approach would have netted the photographer $4,000. Using the RF model, I was commissioned for another eight shoots over the next couple of years, netting a total of $18,000.

London residential architecture

The same architects that commissioned the first shoot continue to grow year on year and are now an important London architectural practice. They continue to send interesting commissions my way.

Taking Unlimited Rights Even Further

After I did my first shoot for the firm that is now a regular client, the suppliers of the glass loved the images and asked to purchase them. As I had already been paid for the shoot, I gave the images to the glass supplier and suggested that if they liked them, they should consider me for their next shoot. Since then, the glass company has become a regular client and they have commissioned a further seven shoots. In addition, because they’re a high-end company, they’re the go-to option for Britain’s top architectural firms. This relationship enabled me to meet more architects and to develop new business.

Thames Lido Design

This is from one of the commissions from the glass suppliers who I established a relationship with by giving them images from my first architectural shoot. Through this shoot, I established a relationship with the architects and also had the images appear in a number of architectural publicatiions

As a Photographer, I Need to Be Shooting

That $2,000 shoot has turned into a $32,000. This is because it resulted in 15 additional shoots.  

Additional shoots are the main reason I use the RF model. The RM model seeks to extract the maximum amount of money from a shoot with the net result being a higher fee earned per shoot. It also results in less shoots. If clients do use the rights managed photographer for repeat business, they tend to commission more carefully as it costs more. An RM approach is perfect for those who want to work less and earn more. For myself, if I could choose between making $100,000 per year doing 10 shoots or $100,000 doing 40 shoots, I’d rather choose the 40 shoots. I love photography, why would I want to work less?

Restaurant design photography

Architectural photography is a difficult passion to pursue without commissions. Using the RF model helps to encourage more commissions. This was commissioned by the glass suppliers previously mentioned.

People Win the Lottery

Every time this discussion comes up, someone will bring up the Windows XP background image example. The photographer received over $100,000 for the use of that image because he managed the rights of the image. Subsequent photographers received approximately $300 for their images because they offered unlimited rights. There is another example of a British automotive photographer who was able to net an additional £100,000 on top of his original shoot fee by managing the image rights.

These examples are like lottery winners. The chances of winning the lottery are next to none, but seeing the occasional winners still motivates people to play. The photographers who received $300 for their images may not stir up much excitement, but they could have thousands of images selling to multiple businesses resulting in a sustainable business. For most photographers, the six-figure payout will never happen.

A One-Sided Argument

Because the unlimited rights model is so derided among photographers, I’ve delivered a one-sided argument to defend it.

The main attraction for the RF model for me is more time spent making photographs. I strongly suspect that any business coach would suggest the RM approach because most business people operate from the assumption that people want to work less for the same money.

I know that there must be some significant arguments against RF, so for the sake of balance, please let me know what these are in the comments.

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66 Comments

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Jonathan Reid's picture

Xander brings in an important point here - managing rights takes time and effort. In the time that the RM photographer spends managing and enforcing their rights, the RF photographer is doing more shoots. This further highlights the point, the RF photographer spends more time actually shooting. Bill, I do also see where you're coming from. If the ultimate goal was to maximise profit, then I agree, however, the business of photography is not ever pure business. Most photographers could make more money doing something else. Part of the reward of photography as a business is the sheer enjoyment of doing the job. Many photographers pay fees to be able to shoot, so when someone actually pays you to do this thing that we love so much, maximising profit is no longer the primary objective.

Bill Wells's picture

I commend and share your love for photography. However, in my example I showed shooting the same number of jobs just making 400% more.

Let me give you a very specific example. We are wedding and portrait photographers (my partner does other types as well). We charge more for a wedding than 80% of the photographers in this area. So we shoot fewer weddings each year than the lower 80%.

Many of the other photographers shoot 2-3 times as many weddings as we do. But at the end of the year we have more wedding income than any of them.

Then we move to HS Seniors. Again we charge 2-3 times as much, shoot fewer senior sessions and are still more profitable in that market as well.

We absolutely love photography. It's just in our blood. The first bit of advice you get, is "find a job doing something you love". Photography fits that for us.

But the bottom line is, you either have a business or you don't. Photography is either your job or it's not. Your goal is to a successful business or it's not.

Do not confuse, taking pictures because you love the art with having a photography business. They are not the same.

Bill Wells's picture

I'm looking for you response to "if I could choose between making $100,000 per year doing 10 shoots or $100,000 doing 40 shoots, I’d rather choose the 40 shoots. I love photography, why would I want to work less?"

Maybe you can analyze this using your logic above. I looked for it in all the responses, I can't find it. Maybe you can do that here.

Jonathan Reid's picture

In your wedding story, you're referring to price point. You mention you're at the upper end of the scale. This article is not about price point, it is about image licensing. Even with the example I gave, I had both approaches charging the same amount ($2000) initially. Over time, by tightly managing the rights (or squeezing out every possible cent), the RM photographer was able to turn that $2000 into $4 000. The RF photographer didn't charge any more for the original shoot, but through licensing structure, was able to secure another 14 shoots at the same original price of $2000, netting him $30 000.

I've never once suggested making your price point low. I can see how you've intepreted that from the the statement I made ($100 000 from 10 shoots = $10 000 per shoot vs $3 333 per shoot), but that was reading the statement in isolation. The point I was trying to make was that I would rather do more shoots at a value that I see fair (my price point is fairly high too), than less shoots where I've squeezed out every possible cent from a client.

Just looking at profitabilty, it is more profitable in the short run to maximise the amount received from each customer, but in the long run, if you're using a different licensing structure that results in regular return business, the profitability is more sustainable.

Bill Wells's picture

I'm just talking about income. If every example I give, someone says will that is price point. I give another example, well maybe those jobs pay different. Could of, Should of, would of, argument does not make sense and just goes in circles.

So let's be clear and start with the facts. You said quote "if I could choose between making $100,000 per year doing 10 shoots or $100,000 doing 40 shoots, I’d rather choose the 40 shoots. I love photography, why would I want to work less?" This is exactly what you said. I'm not adding anything to it.

In that quote you said, "I LOVE PHOTOGRAPHY, WHY WOULD I WANT TO WORK LESS?".

Again, the point you were making was you wanted to work more for the same money because you loved photography. I get that. I applaud you. I think we all enjoy shooting. We are all very lucky and blessed to be doing something we love.

All I was questioning (more of statement than questioning) was that from a business standpoint it just does not make sense.

You can explain your position as a passion but there is no way in this world you can verify this as a good business practice. You also will never find a business school that teaches this.

Again, I respect you, commend your work (actually pretty awesome) and applaud you for your passion. But you just can't have it both ways.

Jonathan Reid's picture

"You also will never find a business school that teaches this." - I said as much in the article. Also, I appreciate your feedback. I honestly expected a lot more blow back than what I'm getting.

Bill Wells's picture

Oh yeah, 40 jobs is 40 jobs. The fact that you do 15 and get referrals for 25 more has nothing to do with nothing. That would be a form of marketing. We are not talking about marketing.

But I'll just wait for an answer to my previous response.

Jonathan Reid's picture

I would say the referrals has everything to do with the licensing structure which was the point of this article.

Christian Santiago's picture

Sometimes you can scream into an abyss all you want, but things will still change.

I’ve developed my own (though I am sure not original ) hybrid approach in architecture to this issue as I’ve lost quite a few jobs tha from clients who were probably put off by the strict RM approach.

I include a perpetual license for collateral ( social, web, ) editorial, and competition usage. They can basically do w/e they want with the images except hand them to a third party to use, or print advertising. Most architecture clients don’t even need that level of usage, so I don’t muddy the contracts.

If the time comes that they do want to run an ad campaign if some sort, then I would indeed charge.

Also some higher end commercial clients have just straight up demanded full buyouts of images. In ehich case I charge for that too.

However you want to handle it, the truth is there’s a ton of photographers giving away the farm and clients are getting used to it. I don’t like it. People already look at the industry more and more as a cheap commodity for a plethora of reasons. But it is what it is.

I just can’t imagine a musician giving away the rights to a song without batting an eye.

Jonathan Reid's picture

Mmm, your comment has just made me realize that I've left out a crucial bit of information. My "RF" approach is based on charging for a full image buyout. Essentially that is what RF implies right?

I'm against "giving away the farm", but I also don't want to squeeze every possible cent out of my client. A balance is needed where I am fairly rewarded and the client feels like they received value for their spend.

Jonathan Reid wrote: “…full image buyout. Essentially that is what RF implies right?”

I’m cautious about using the terms “RF” and “buy-out” interchangeably.

I view “RF” strictly applicable to stock photography licensing and not for images created on assignment or for a specific client.

In the US, it’s advantageous to avoid using the term “buy-out” in creative agreements: “Buy-Outs” can be a vague licensing term; it can have different meanings to different parties. Best practice suggests is to use exact terms in agreements rather than the term buy-out.

According to UsePlus.org, http://www.useplus.com/useplus/glossary_term.asp?pggl=1&tmid=10600000:

Buy-Out is “an imprecise term used to describe acquisition of broad usage rights to a work, sometimes in a particular market or medium. Buy-Out is a slang[!] term, often misinterpreted as a transfer of copyright ownership of a work from the copyright holder to the client or client's agent.”

So, if a buy-out means granting unlimited rights, then write the license as unlimited use (for a limited timeframe, territory, media, etc.). If a buy-out will provide the client with all rights, copyright interest/title, and ownership, use “copyright transfer,” and confirm both transactions in writing.

Though I disagree with Jonathan Reid’s position on granting clients (RF?) unlimited rights to assignment images to gain continuing work and/or new clients, it’s hard to argue with his success. As more photographers enter the market, we’ll have to see if his photography business model is sustainable over the next few years.

Jonathan Reid's picture

Thanks for your clarification. Generally I feel that royalty fee and unlimited rights are terms that can be used interchangeably. I hear the term “full image buyout” from clients when they ask me to quote on a job. They might say something like, “can you adjust your quote to include a full image buyout?”

I take that as implying unlimited rights which I specifically word in my estimate.

A clarification update: For licensing stock images, one could use RF terminology; but for images created on assignment for clients, I would specifically use “unlimited use” when an RF-themed broad rights license is being contemplated.

Julian Ray's picture

Spot on Jonathan.
At least for my way of doing business. I totally am against driving down the market and devaluing our work. Just won't.
I also know that what I offer to my clients is a service. And 'ease of use' is one facet of that service.
Like you I've learned that when a client finds the licensing easy to use they will in fact pay for that ease. I think a lot of people equate RF with cheap. Not at all! And yes shooting more and being known as fair will always net more business than squeezing every last penny out of a shoot.
With imaging budgets declining and more and more "photographers" out there the reality is that RF is the future. Like it or not if we don't adapt to that reality we will become the RM (Really Messy) past.
For those who have not tried it.... think of RF as meaning.... Refer Frequently.
Thanks for being willing to step into the fire with this article.

Jonathan Reid's picture

Thanks for the feedback. I'm pleasantly surprised with how little negative comments there have been.

Julian Ray's picture

That is how progress often sneaks in and surprises us. Keep on pushing!

JetCity Ninja's picture

it depends on your market. neither is perfect for every situation. to assume as much is simple-minded.

Jonathan Reid's picture

For sure, but for the sake of discussion, it is useful to group the approaches into two extremes. If I were to cover every nuance, this would be a book rather than an article.

Alex Armitage's picture

Hmm this is missing a crucial step I haven't managed yet.
1) Earn money shooting photography.

#goals

Andy Day's picture

Ha! With you there, mate!

Jonathan Reid's picture

Haha! You're well on your way mate.

Simon Patterson's picture

The RF model is much more intuitive. Glad to see a good case made for it here, by someone who has been successful for years with it.

Jonathan Reid's picture

Intuitive and made for a more simple life. Thanks for the feedback.

Andy Day's picture

Great article. I've always sniffed at the prospect of the RF model but you make an excellent case, and it suits your line of work. And giving it further thought, i realise that for one my largest jobs last year, I gave my client the option of both - an RT model with large one-off fee, or an RM model with a lower up-front fee and licensing options after the shoot. Unfortunately, the client went with the latter and I'm still waiting to find out if they'll license anything, almost one year after the job. I'm still waiting to find out if I made the right choice..!

Jonathan Reid's picture

Even though I've used the RF approach for the past 7 years, I too sniffed at it. I think it is because of the cheap microstock sites that use RF. It makes people associate RF with cheap. As long as you're billing an appropriate amount, both approaches have their merits.

Jonathan Reid's picture

Just to add fuel to the fire, how many of you photographers out there prefer licensing Adobe software monthly vs paying a one off fee?

Simon Patterson's picture

Yep, good example. I use Photoshop CS6...rent money is dead money. I don't miss CC at all.

Jason Hughes's picture

I always try to test the waters at first to see if the client is willing to work from a Rights Managed perspective. There the possibility of doing a semi RM model that restricts usage to a single product/application or number of impressions, but doesn't have a time restriction. Meaning that you can negotiate additional pricing for say website usage, internal usage, annual reports, etc.

I did a job with a local bank last year where we charged creative fees and licensing fees to make the overall takeaway worth the effort and time. The art director said that I was the first person in almost 20 years to even discuss yet alone charge additional licensing fees. You have to know your client and know who has the budget for licensing as well as the funds that may be necessary for reupping usage rights. They Glady paid the RM fees and hired me for a few more jobs afterward.

If a client doesn't have the budget for such a thing, then I always would look to move toward the RF model. There is always room to work some form of licensing model into the shoot. As long as you can retain a client that pays what you ask then you're doing alright.

Jonathan Reid's picture

I think you've touched on an important point in your statement - working with the client to provide them a great service with a license that works for both of you. Too often as photographers we treat our clients as the enemy.

Jason Hughes's picture

Don't get me wrong...there are still a fair amount of clients that I have to walk away from because the costs/budgets outweigh the profit. (But that's a problem for all of us) The RF model is a viable option, but works most effectively for situations in which the client respects your creative fees AND is open to licensing. From my personal experience where I do run into most of my roadblocks are with traditional work for hire gigs where they own full rights. Trying to explain licensing, or move them toward an independent contractor agreement for my wallet's sake seems a foreign concept to those clients.

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