'Rights-Ready' Licensing Model from Getty - Here We Go!

Peter Sargent | August 11, 2006, 03:35 PM

In the midst of downward spiraling stock prices from major players in the stock images market, Getty announced last week that they are unveiling a new licensing model for a portion of their images inventory known as "rights ready" licensing. (http://gettyimages.mediaroom.com/index.php?s=press_releases&item=367)

Historically, the licensing of rights managed images has been predicated on 4 basic variables:

Duration (how long one can use the image)
Territory (in what parts of the country can they be displayed)
Media (TV versus online, mobile, print and outdoor)
Frequency (number of times an image can 'air' or be displayed)

This model, with a myriad of variable combinations (which requires a PhD in astrophysics in order to decipher -- ok, I'm exaggerating), has become increasingly simplified to satiate frustrated customers. Territories (which were generally defined by TV broadcast regions) have now broadened to larger regions of the country. Frequency is also less relevant.

So in this spirit, Getty's new model licenses 80,000 of its images inventory irrespective of duration or territory. It is essentially based on media. A Getty customer can use the image in a single medium (say, mobile devices) without concern for frequency or location. In addition, Getty has set "8 fixed price points" to further simplify the process for advertisers, publishers, and creative-types.

The rights-ready model signifies the first major defense tactic against the likes of iStockPhoto and Flickr who sell images at rock-bottom prices. Using a My-Space-like environment, where amateurs and professional alike can upload their images for sale to anyone interested, these newcomers are rocking the entire industry to its foundation. (More on this emerging business model in my next blog.) By paring out a portion of its inventory, Getty intends to offer simplified (and presumably lower) pricing to its customers. To what extent this pervades their inventory in the future, and its likelihood of cannibalizing revenues from its other images, remains to be seen. But the tactic is designed to keep discount shoppers from leaving Getty altogether.

It is worth noting that Getty is the first company to offer such licensing for its images. This demonstrates a forward thinking approach that ought to pique the interest of JupiterImages and Corbis. But for the record, this licensing model is not new. In fact, Ribbit Films (whom I've discussed here in the past (http://weblogs.jupiterresearch.com/analysts/custom/archives/2005/10/the_future_is_s_1.html) adopted this model for it's chromakey stock video footage nearly two years ago. Hooray for the little guy!

-Peter Sargent - Research Director