A few weeks ago, photo community and marketplace 500px announced a very steep price cut to their royalty payments. I didn’t feel the need to cover this in my blog as I dropped almost all “news” around here since it is mostly already covered by MyStockPhoto and other places.

But since some time has passed, I have something to add to all the anger and offense people have taken, particularly in forums like MicroStockGroup. I almost let this go as well but since I just read another guy complaining about the evil people at 500px, I feel someone needs to point out the ridiculousness of the whole situation. But let’s start with the facts:

When 500px announced a market place a few years back, their original proposal was paying 30% of royalties to their contributors. As its start was as a photo community (offering paid accounts for photographers with advanced features), there was some outcry amongst photographers of whom many may have had little experience with the stock photo industry and its developments in the years before. The 30% was actually a reasonable offer, comparing it to what the market leaders Getty Images, iStock, Shutterstock or Fotolia were and are paying out.

It was clear it couldn’t stay at 70% forever

However, back then management reconsidered after all the bad PR they received, and turned the table around, rather surprisingly offering a 70% royalty rate, never seen before in the 15+ years I have been uploading images to agencies. This model may have worked out, considering that the company was already making money from (some) photographers paying for advanced accounts, and at a higher price level for the sales, keeping 30% would have still made a good amount per sale.

Then again, at these prices, you don’t sell that easily, especially given there was quite some competition around both at lower price levels (the microstock agencies) and at the premium price level (the established Getty and Corbis as well as the new competitors Stocksy United and Offset which were launched around the same time. In that price category, Jupiter Images had lost the fight a decade before and Corbis had been struggling for long (so much that they eventually were sold out earlier this year). It definitely isn’t easy to find customers to pay for images.

By itself, the 70% rates were not something anyone could ever have expected to stay in the long term. Even the co-op Stocksy United (and “co-op” means there is no corporate behind it asking for profits to be made) couldn’t possibly pay out royalties at that rate and still have money to invest in technology, marketing and all the elements that are required to grow substantially. It is just impossible to compete when all the other kids around have twice the money you do. So with some reasonable thinking, it was rather foreseeable that eventually changes needed to be made.

The clear signs that Prime didn’t work as planned

Add to that, 500px had already made some changes to its offer last year, by changing the branding from “Prime” to “Marketplace”, splitting the collection in two levels, lowering prices for customers. All of these were clear indications that things didn’t really go all that well. You don’t change your whole model again and again if it works. Okay, so let’s be clear: The signs were there, we might not have seen them as clearly as we should and could have.

My personal experiences with 500px are pretty limited. I had known them for some time, uploaded a few images to the community side, submitted a few images to their market place. Then, I started my mobile stock experiment (which is still on hold due to time restrictions) last fall and since those images were kept separate from my microstock accounts, I decided to add 500px to my distribution list for them. Earlier this year, after receiving indications that they in fact do have sales (I couldn’t tell myself because I had none so far), I decided to give them some more attention. It’s still not serious for me with some odd hundred images or so submitted.

500px isn’t going to be my favorite either

But don’t get me wrong: I am still angry about the royalty cut. Mostly because it “hit” me at a point when I was considering a more serious relationship with 500px in the future. I got involved, I got interested and then the news hit me as it hit everyone else.

In addition, 500px is ridiculously slow in reviewing images – while images are available for licensing right when submitting them (with the option to get an image fast tracked to the review team if you are interested in licensing it), there are indications that reviewed images were shown much better towards the customer base. Taking two or three months to review images is a terrible thing for contributors, and it is after all rather unnecessary because the cost wouldn’t be higher to split the work amongst more reviewers. It’s just a business decision to not put priority on this.

Also I have to say that the support experiences I have made are rather dreadful. While being nice and kind like Canadians all seem to be, at the same time incapable of giving an actual solution to a problem. But it also started with my experience that I had “won” an “Awesome” account (offering unlimited uploads and a couple more things) but they forgot to ever tell me about it. Instead, I just received an automatic email at the end of the term that I had won. No big loss for me since I didn’t really have plans to upload unlimited amounts of images but somewhat odd it was.

So now I’m back in “testing this” mode and will keep them low on my list of priorities. No big loss for them most likely, no big loss for me either.

The hypocrites of microstock

However, reading all those comments in the online communities, first and foremost in MicroStockGroup but also on some blogs and within the 500px community, I feel the pain an agency like 500px must have been going through.

On one hand, people complain when an agency is cutting royalties from 70% to 30%; I totally relate to that anger.

Then again, you upload images asking an agency to go out and find clients for your images at a price tag of

• $149 per image (actually $249 if you started a year ago)
• at 70% royalty rate (or 50% or whatever people here would feel happy about)

But what you are offering the same images at the same time for

• $10 per images
• 20-30% royalty rates
• subscriptions with less than 40 cents per download

Stop! Stop reading right here! Let those numbers spin around in your head for a moment.

I am really surprised that some people don’t find any problem with this kind of thinking. Well, sorry to say but I can’t help myself to be on the side of the agency on this one. That’s most definitely not the kind of contributors an agency loves to work with. So I somewhat can understand if they are telling that kind of contributor “sorry but if you want to use our market place to sell your images, we are not going to pay you a higher percentage than what you are already willing to accept elsewhere at a much lower price level”.

And I have read comments like

“I was getting ready to upload 30,000 images to them but I guess now they will stay on my hard drive”

Which I find hard to believe, it is much more likely that those images are already available at subscription prices on a dozen agencies or so.

Or another one saying

“Now they deleted 1,200 of my images for being too similar”

No surprise, I’d say, considering how serialized people tend to shoot for microstock. No offense, I do the same when shooting and submitting for microstock. The more, the merrier. Fine. But I wouldn’t dream of getting away with that in any premium collection, anywhere.

Feel free to attack me for saying it but if you are one of those people arguing along those lines I blame YOU if an agency like 500px fails to generate significant revenue. Burying the really good images that customers are willing to pay for behind tens of thousand average shots, serialized like it is common in microstock, and available at the discount prices everywhere. This is not a promising concept. Do not act surprised if an agency finds out sooner or later that this model can not work.

Instead, get your act together, be honest about your images, split them up into images that deserve to be sold for $1 a piece (again: no offense, I have thousands myself that fit that description) and find the gems in your portfolio that might warrant a higher price. But then don’t sell them at the $1 store at the same time when asking $100 or more for the same product at a different place.

It isn’t like you would drive to a gas station on the other side of the city that demands $200 for a tank full of gas when you only pay $50 at the well known place in downtown. Why do you expect your image buyers to do that then? Honestly, I don’t feel sorry for your loss. You didn’t belong in there from the start.

If you’re in it for the money, the time for “upload everywhere” is over

Now I am in the comfortable position of having options: I have been lucky enough to become a founding contributor at Stocksy United, I was selected as a photographer at the macrostock distributor Westend61, and I am totally happy with both of them being my business partners.

Not everyone is as lucky as I am, having those options. Right? So I am talking with some arrogance if I talk about choosing where to sell. Right? Well, you might be. Then again, Alamy is an option that is open to almost everyone. The EyeEm Market is also a place that can be used as a sales platform by almost anyone. 500px still is another option.

And I haven’t been all that lucky after all, I think. Because I also have been rejected by agencies. I just put in a lot of thought into the “why was I rejected” and “how can I become better” over the past few years. Sure, I have also been at the right place at the right time but that is also because I have “wasted” a lot of time being around at a lot of places. Opportunities aren’t opening up just now when you need them. You have to work for them to open up.

We have had a really great time in microstock, at iStock in the years of 2008 to 2010 with a thriving and active community and an ever growing customer base; with Shutterstock in the years after. But we are now at a stage when all the technological advances we have profited from are available to everyone and submission of images has become easier and easier. We have lots of competitors in the market, covering a wide range of customer needs at a wide range of pricing. Make use of all of these. But figure out what your product is and where it belongs. I am still not ashamed to be an active microstock supplier, actually my royalties in this area are still growing if only at a slower rate this year. But to become profitable it takes more than just putting your images anywhere you are allowed to.

Diversify, specialize, review and improve the product you are offering. And then choose which of the channels is the best for that product. Which can still be microstock or a premium place but most likely not both. Don’t make that mistake or you will be disappointed.