Thursday, 29 November 2012

Alamy & the North Korean School of Contributor Relations

It speaks of  a certain corporate mentality -  and not  a particularly  healthy one when apparently confident organisations  like Alamy  feel so  insecure about the decisions  they  make  that  they  are  unable  to tolerate  any sort  of  criticism - even from humble one-man-band photographers.  In addition to deleting posts from contributors on their own forums Twitter  users  who  have merely  retweeted  criticisms of the picture library's recent moves have found themselves being unfollowed by Alamy - surely the social media equivalent of being sent to a Soviet era Gulag?

We jest of course, but only in part. In CEO James West's video which becomes more interesting upon each viewing, listen carefully to what is said at the 28 second point -

Chirpy Scottish Lady: And what are you going to do with the extra 10% you are going to get?

James West: Uhhh ten percentage points. We are going to keep doing what we have been doing....

Note how he quickly corrects her by emphasising that it is not 10% but ten percentage points. Seemingly he is aware that the way he has presented it is open to misinterpretation and misunderstanding by contributors.

Wednesday, 28 November 2012

Alamy Keeps it in the Family

Alamy likes to boast about it's good works. In fact, from 2006 - 2010 it says it donated 89% of it's profits to one charity - the Fischer Family Trust, a charity whose address is the same as Alamy's and whose trustee is Alamy co-founder Mike Fischer,  who is CEO James West's uncle!

EPUK condemn Alamy commission cut

Editorial Photographers UK, the respected forum for British photographers criticise Alamy's disingenuous presentation of their figures and state -

The problem for contributing photographers is that Alamy, like other high-profile agencies today, appears to be investing less and less in photography yet more and more in themselves – leaving photographers to wonder how can they be expected to expand their businesses, supplying Alamy’s source material, when their own revenue streams are decreasing?

And now photographers are asking what happened to the original Alamy pitch that brought the agency so many new contributors. That pitch was “We give you more because you do the keywording.”

Tuesday, 27 November 2012

Alamy double profits in 2011

The financial data company Duedil have posted some interesting information  (registration may be required) about Alamy.

On the 31st December 2011 they posted a pre-tax profit of £544977, an increase of 97.5% on the previous year. However, according to the site their turnover was only up 5% at £14,853,670,  so this may have been affected by the factors such as the reduction in   staff numbers from 129 to 65.

Alamy prohibit any discussion of the reduction of commission on their contributor forum

Presumably having had enough of the negative comment about their commission-grab Alamy admin prohibit any further discussion of the  issue on 23rd November 2012. One wag contributor quotes Stalin when he states -

"Njet cholovjek, njet problem" (No man, no problem)

Alamy's Fuzzy Math - when a 10% royalty reduction is really much more

Photo Business News & Forum dissect Alamy CEO James West's statement and discover that the apparent 10% reduction in percentage points represents at least a 17% reduction in real terms. Their article is reproduced below.

Alamy recently announced they would be adjusting the percentage of royalties they would be paying by 10% - in their favor. The reality, is, though, that it's actually going to impact your revenue by much more than that. It is important to note that Alamy pays one rate to the photographer when they have a "Direct" sale via their website, and one rate to the photographer after an Alamy "Distributor" (a.k.a. sub-agent) licenses an image, so both are provided. Here's how their numbers break down:
  Is this fair? Well, it's a business decision. However, let's take a step back. The 50/50 percentage hasn't been fair for at least a decade. Why?

Back in the analog days, it cost money for a New York-based stock photography agency to receive, catalog and store your images. Once that effort was made, when a call came in, for, say, a Time Magazine stock request, an image license for 1/4 page was about $250. There was physical labor involved in locating the image, filling out the tracking sheet and delivery memo, packaging the image for shipping, and then, when the image was returned, confirm the image wasn't damaged, and then re-file it, all for a 50/50 split of $250, or $125 to the stock house. I'll even include a few years where the stock house was converting their libraries from analog to digital, and so they incurred those costs.

Now, it's all digital, with little to no human interaction required, yet not only did the 50/50 split persist, but it's eroding away even further, and unfair.

Now more than ever, photographers need to be their own distributors. You will see Getty Images making a similar shift in percentages in the near future. We'll tell you why, when they announce it.

Initial statement from Alamy on commission changes 20/11/2012

James West's commission cut announcement  included  a bizarre video in which a number of pre-approved questions were read out by a minion, apparently to convey verisimilitude. Note how he seems unable to look the camera in the eye.


We’ve posted some important information on our blog and there is an accompanying video from James West Alamy CEO to explain some changes at Alamy.

In summary;

Your royalty percentage will be decreasing by 10 percentage points in early 2013 for direct and distributor image sales.

The change applies to all images from all our contributors, regardless of which commission structure you are on. For example, Alamy Blue contributors will move from receiving 60% of each sale to receiving 50%. Video royalties will remain unchanged at 50%.

Why are we doing this? Alamy is a profitable business, however we are at a stage in our development where we have reached the limits of our expansion under our current set-up.

Alamy has developed significantly over the past 18 months. We introduced a News Sport and Entertainment division and we are now selling video. We’ve started curating the collection for creative picture buyers and continue to bring innovation and high quality service to the editorial market. We have ambitious plans to gain market share from our competitors and grow the business.

We’ve increased our sales staff in our core UK and US offices and also in key growth markets such as Germany, India and Australia. We’re also simplifying the buying process for our customers by introducing sales focused initiatives such as Alamy iQ.

In early 2013 we’ll unveil our new look website.  Alamy is transforming into a Sales and Marketing led business with the ultimate goal of growing sales.

All of this is designed to drive sales and this will be accompanied by further initiatives planned for 2013 to improve the contributor experience. 

We understand that reducing your share by ten percentage points cannot be seen as great news in the short term. However, this investment will provide Alamy with the foundation to greatly improve our presence and penetration and so increase sales. 

When we made a change like this back in 2008 it was to fund expansion into the US. We’ve been true to our word. Our US office sales performance is growing at the rate of 30% year on year. The US is now our largest direct sales operation and we are currently recruiting staff to expand it further. Our experience shows that investing in the right things does pay off.

All contributors will receive a formal notification via email of the changes to the contract.

Thank you for your time.