What you notice first if you look at the agencies: there are many of them. Not as many as contributors of course, but nevertheless they need to look for an USP. There always was a need like this of course but with a rapidly growing market a lack of a good strategy or distinction was easy to hide; even so a large number of agencies failed. The pressure to stick out will get much worse.

One answer to that challenge was and maybe still is to be the agency with the lowest price. But on the long run the competition cannot work on the price front alone (and indeed the run to the bottom slowed down) simply because no business can survive with the price of its product reaching zero. Also with contributors becoming more professional and building their own trademarks, microstock on the (admittedly narrow) good end will be less of a commodity than it used to be. There will be (sort of) a war for talent and it cannot be won without some fair compensation.

Thus, other measures than lowering prices and cutting contributor shares will have to be found. As always, those things are – roughly – content management and relationship management.

1. One obvious example could be to go for exclusive content. That will work for a while. The danger is that with the number of pix accumulating it will always be possible to find good pictures elsewhere. The concept may still work (if not as good as before) since with just one exclusive source to download an image it is easier for customers to check how often such image has already been downloaded and possibly used – maybe by competitors. An agency that is able to sell lots of exclusive content at a good price point may also be able to attract talented contributors who look for a way to ease the burden of account managing and wish to focus on shooting and procession pictures instead. Therefore expect to see even harder attempts by agencies to wall in their contributor base.
2. Agencies will continue to look for more content and more types of content. Nevertheless, there will be a time when sheer numbers loose their magic. With 15 or 20 million pix on stock in the big players at this point another 500.000 seem less desirable that they did three years ago. Therefore, there might be more segmentation in the type of content in the future. Some agencies lead the pack here with a full set of media pieces (editorial and commercial pictures, code snippets, illustrations, sounds, videos and so on). They will be followed. Any agency that can pull the stunt to offer such a full set of media types can also show that it is capable of running the complex IT-infrastructure to do so. That I call building trust.
3. Another promising approach, maybe the key point, is to make the content more accessible for the customer. That is, to have the best segmentation, the best ranking algo, the best pattern recognition and the best control over the description data / vocabulary possible. Agencies walk this path already. The top agencies already do have ranking algos that are keyword sensitive – which is a leap forward – and allow a full set of criteria on how to rank and display search results. However, only very few agencies do have a really good disambiguation of keywords or halfway reliable translation tools. Also, there have to better ways to distinguish between main and auxiliary keywords. There is a lot more that could be written about this very important point and this topic is surely worth a closer look in some future post in this blog.
4. Talking about segmentation and differentiation: Some agencies begin to understand that there are indeed different values in different kinds of content. Some types of premium pictures simply should not be sold at traditional microstock price points yet they can perfectly be sold royalty free. Thus premium collections will be a thing we will see more in the future.
5. Active content development as opposed to simply “wait and see what flies in” will play a bigger role. Local content will have to be attracted. And one should not only think “China, Korea, Brazil” but also “Oktoberfest”. I am also convinced that in the medium run “content development” will also mean “content monitoring” or less euphemistically, the weeding out of embarrassing existing content stemming from the good ol’ days. And there is a lot of it.
6. Agencies will also further try to conquer new territory. There is an unbelievable lot or markets out there that have barely been touched and that wait for an kick starting event.
7. Agencies somehow do not seem to like seeing their contributors as businesses. Nevertheless in the long run they probably cannot avoid treating them as such if they want to compete for talent. Therefore, they will have to give their contributors much better back-ends. A first step in the right direction would be to have a two-segment back-end, one for content editing and one for financial transactions. In this case the contributor could have their picture editing outsourced while still maintaining control over their financials. It is a shame that is not possible today with most agencies. Additionally, the tools most agencies offer to contributors in order to analyze their sales are a laughing stock.
8. There are numerous other things to do and consider. Alas, at the end of the day agencies will also have to wisely spend marketing Dollars, Euros, Yuans and Pesos. This may sound like a banality but it is true nevertheless: be cool and tell all the others about it in a way they can believe it.

1. In order to “survive” Contributors will have to produce better content. “Better” here is used in a broad sense: it does not only mean the visual quality of the picture – contributors love to focus on that. It also means that the picture has to transport a concept and the description / keywords have to verbalize this in a way understood both by the search engines and ranking algorithms of the agencies and the customers looking for pictures. Contributors will have to understand not only photography but also an agency (and their IT-systems) that treats them like air, a customer they do not know and a topic (in the picture) that is not theirs. In short: they will have to become much better in solving equations with lots of unknown variables.
2. Contributors will have to produce more content and be able to process such content down the chain. They will very carefully have to decide whether they do everything themselves or whether or not it is wise to have other people process some given task, due to quality or for economic reasons. In order to decide this they will have to become aware of the processes they use, streamline them and make them outsourceable. They will, in fact, have to become a business.
3. As with every business, the ability to act quickly and put the resources needed into every action will become more important. Microstock is a game where the contributor puts the money on the table first without knowing whether they will profit from that investment. The more one produces the more resources are needed to put in action. This is a financial as well as a logistical issue. For most new contributors with an emphasis on the first issue, for most established ones on the second.
4. Contributors will have to have a much closer look on the market. Today many contributors still operate without any market research or content development based on the premise “produce and then see what happens”.
5. The cream on top may try not only to look at the market but actually try to develop it, place certain styles and fashions and promote them. They can become market leaders who will be followed and copied. That happened in the past for some (Yuri’s style of business photography, Ioannis’ “white men”). Even if that does not work for everybody it seems worth trying. On the way contributors may become trademarks in themselves and their style might be recognized and actively sought (designers may “bookmark” them). That is obviously a very good position to be. Such contributors will be the Danone among the yoghurts and thus sell more (in a market were distinction in price is hard).

There still will be the kind of contributors who simply put pictures of their pets in the agencies, and they will still make a buck or two. But they will not shape the industry or produce enough to work on a business level.

That all being said some questions remain open for me and I confess I do not have a clear answer at this point:

1. Should one be an open or an exclusive contributor? The question is discussed exhaustively elsewhere with no clear result. I may add to the discussion one important point: Of the agencies named worth thinking of contributing to exclusively, some do all the financials in US-Dollar. For most contributors living outside the US or outside countries with currencies pegged to the US-Dollar that poses a considerable currency risk. The Dollar is very likely to decline further against most currencies in the world and has, in fact, become as volatile as the currency of a banana republic. Thus, any contributor would not only put all their eggs in one basket but would also be unsure about the size of the basket.
2. If the choice is to submit openly, should the contributor try to submit to “any” agency or rather find a selection? While the first impulse probably is to sell content on as many channels as possible there are nevertheless two considerations here. First, it does not pay to submit everywhere. There are marginal sellers where the price of submitting does not outweigh the results that can be archived. Yet, there also is a – not so trivial – consideration of possible cannibalism and market positioning. Some agencies sell the content so cheap or look so shabby that it might tarnish the image of the contributor and hurt their portfolio and RPI if they are to be found there.

Where do all those considerations lead to? Contributors will become less photographers and more business people. This development is – this should be noted – not actively supported by the agencies; otherwise they had different contributor backends. Nevertheless it is inevitable. This task cannot be stemmed by all of them, so there will be a further differentiation in the market: a thick cluster of occasional contributors, some in the middle struggling, and a thin layer of cream on top. Now choose your segment.

In the next part of the article we shall have a look at the agency side.

Is there something to that? To a certain extend: yes. Is this a bad thing? Not necessarily.

You should know that indeed there was a gilded age for microstock. That was when the industry was young enough to be sniffed at by the professional photographers but mature enough to already have a strong customer base on the demand side. There was land to be claimed and relatively little competition. Even mediocre or outright trivial pictures could be sold simply because they were cheap. Conceptually good pictures, well executed, could make you a fortune.

Well, this is over. There are no sales anymore for the USB-stick with shallow depth of field or the not so incredibly well lit tomato isolated on white. The stocks of the agencies are filled with them and most of the existing pix have accumulated such an amount of ranking-juice that for the foreseeable future they will stick on the top. If somebody looks for a trivial (read: exchangeable) picture they will have an impulse to buy something from page one. That’s it for that.

On the other side there is no such thing as an end to stock photography just because there is already a lot of stuff, such as there is no end of science just because we already know a lot. There will always niches, there will be changes in the way we take pictures, in the taste of buyers, and the way models do their hair will be different in 2013. Promised.

That being said: yes, microstock matured. To stay on top requires much more conceptual thinking, technical finesse and – not to forget – resources than it once did. That is due to a number of reasons.

1. More and more professionals are entering the market and more and more of the once amateurs that claimed the first patches of microstock land became professionals. That means that both, quality and quantity of pix get better. The latter extremely fast with lots of professional photographers moving their “back catalogue” in the agencies at breathtaking pace.
2. Buyers get more selective. They are simply used to high quality even in the cheap end of the market. We trained them that way. We might mourn at this yet I see no way to undo it. Accept it.
3. The market cannot grow forever at the pace it did. There indeed was a time when the demand for microstock pictures grew faster than the GDP of China. However, today most people who could have a use for microstock already have heard of it. This does not mean that there will be no further growth – the world getting more visual has been a trend for some thousand years or so and I do not see a stop here – yet the inflationary state after the Big Bang is over.

Those things are obvious, but what does all this mean? The answer is different for each player in the market. Let’s have a look at the contributor side in the next article.

Two days ago I had the opportunity to shoot in a disco club with ten models, two make-up-artists, my full set of equipment, some time, and no force that kept me from experimenting. Now, if you ever worked in disco club with a party going on you know that due to the people moving, the light show, the dry ice fog etc. there is nothing you really can prepare for or count on. You more or less have to let go and simply try your best in every situation. Which simply means: having fun.

This is how I found out for example, that you can actually picture laser beams flashing through a group of people dancing. Never thought this could be done yet it can. I’ll have more of that later I think.

First of all it is surprisingly hard to convince Abobe to sell me anything at all. I used, as I always do, the US site. Well, US, the Internet is supposed to be international I thought. Through a desert which stylistically needs an update anyway I navigated to the products I wanted and put them in the shopping basket. For the checkout Adobe wanted me to log in with my Adobe ID. I did that. And was refused. The reason? My ID is valid only for the German store.

This is bad since for some silly reason the prices in the German and the US store are different, even for identical products. I want, obviously, an US/English Photoshop since virtually all books and tutorials are English as well. I could buy that for a good price on the US site or for an overcharged price on the German one. I was willing to swallow even that and typed the adress of the German site in my Browsers’s adress bar.

But still: Adobe refused to sell me the products! The reason was, that when I clicked “kaufen” (“buy”) on the German site I still landed in the US shop (why, please?) – where my ID was not valid! It cost me 20 minutes to find a menu in which I needed (by hand) to navigate to the “proper” German shop. Why in the world cannot Adobe simply direct me to that shop? And why do I land in the wrong shop? And why *is* that shop so wrong anyway?

But it does not end here.

I wanted a download version of the software. Adobe has the guts to actually demand a *higher* price for the download version. It’s true! The version they send you in a parcel costs *less* that the version without a DVD and a box! This obviously has to do with the fact that the soft version is downloaded from Ireland which has a 21% VAT instead of the German 19%. So I have to pay for Adobe’s decision to settle in a tiny little rainy bankrupt (yet very beautiful, this is about Adobe, not you very nice Irish people) Island. Doubtlessly they did that for tax reasons. Thank you, Adobe, for lowering your tax burden on the money I pay you by making me pay even more.

The download itself is a procedure that was undoubtedly designed by German engineers with a lot of Danish humor. Every time I clicked on “Download” the download manager Adobe uses changed the size of my browser window and one time it said “this manager seems not to be running” or so. I never understood the need for a “download manager” anyway, but *if* you want one on your site, cannot you use a good or at least properly working one?

Needless to say: Paypal did not work as well and I had to pay by Credit Card (probably not Adobe’s fault).

This whole experience felt like one big kick in my butt. With two licenses for Photoshop and Lightroom (one for my assistant and one for me) I may not be Adobe’s biggest customer. But I fell ill-treated. I would very much which for a serious competitor for Photoshop, just to get a bit of competitive spirit back into the way Adobe sells its products. I am seriously not happy.

PS: First trial of the new software. Lightroom has greatly improved but is buggy like hell. I am sure that we will see LR 3.1 in a not too distant future. PS CS5 is, well, different. Yes, some tools work much better, it’s true, and this is why I bought it. But there are “improvements” in the GUI that change most things to the worse. And there is no help that is worth that name.

Here is an example: coming from CS3 the “curves” looked different. I customized a curve and wanted to save it. But the save-button, as known in CS3, was gone. I could not find any other way to save so I tried to click the help button and typed “saving custom curve”. What I got was an article on how to save such curves in CS2 – simply by using the save button. Exactly the button that was gone. Why I got an article on CS2 while using CS5? I do not know. And, actually, I do not want to know, for to understand this one probably need a very twisted mind.

With wild clicking I found the right button eventually. But it took me eons and I learned much more about the help feature than I wanted to know.

People will wear colorful Tracht, the boys Lederhosen and the girls Dirndls which can be had in all colors and stylewise from straight laced to frivolous and where I personally and as a photographer prefer the latter option. Glorious times. And the best thing: they reappear each year.

I do have a similar story. I always thought about moving my stock operations into a nice shiny loft downtown. It would feel good. And it would be of no use at all. I guess I’ll stay in my study and have my people working for me from wherever they choose to. I also do have no dedicated office as a lawyer – which I also happen to be.

The next big crisis in the US is the commercial real estate bubble. Why am I not surprised?

Commercial real estate is in the midst of changing dramatically. I am not saying that in the future there won’t be big corporations with real estate needs. They will be there. But at the same time the workforce in Europe and most parts of the US is shrinking and a lot of people seem to enjoy working in corner cafes much more than sitting in a cubicle.

And then, well, there is the 21th century. Technology has, finally, caught up with the needs of people who want to do business, but at the same time there is also a cultural change going on. People simply do not longer expect me to work from nine to five (or from ten to ten since I am an attorney) in my office. They are very comfortable instead with reaching me on my mobile phone or via Skype somewhere on this planet. They do not care where I am because they know we can stay connected.

What we see right now is not just a short slip of the marked but the turn of the tide: a paradigm shift. Anybody want my REIT shares?

Last year (actually a week after Easter – which is why I can show it only now) I prepared some pretty nice shots for the topic. In them the “Easter world” actually looks a bit more green than it will this year, at least in this latitude, since Easter will be so early this year. Ah, and by the way: this stock photographer survived the cutie-attack by three little girls in pink and white dresses and a flurry bunny. But barely so.

Anyway, if you have any need to shop for this or other Easter shots from this stock picture series you might want to check out my portfolio – which includes these pix of course .