What is being done now
Since SAA's study, there have been promising signs of active tracking and recovery efforts across the stock photo industry. Today, Getty Images, Corbis and many other companies use web-scouring technologies to aggressively identify and pursue online infringements. It is also encouraging that new technologies are now extending this vigilance offline to include important print uses, such as magazine and newspaper advertising.
Getty Images has affirmed their policy to address unauthorized uses to their contributing artists, stating: "Getty Images considers the subject of copyright protection of the utmost importance and has an active program utilizing a range of measures to deal with the issue. We are committed to continuing to do all that we can to enforce copyright laws and ensure that both our company and our photographers and filmmakers are compensated for their work."
In addition, and following up on SAA's recommendation, Getty Images introduced an online Unauthorized Use Form for contributors to report suspected unlicensed uses.
Corbis, too, actively engages in recovery efforts, having recently brought successful legal action against a major infringer, TemplateMonster.
It is evident that efforts to track and pursue infringements have grown in recent years, and that they have led to recovery of substantial revenues. What's unknown is how many infringements occur, how much of this loss is recoverable, and how much revenue has been recovered.
Estimate of Lost Revenues from Infringements
Naturally, everyone wants to know the dimensions of the problem in dollars and cents. We cannot draw precise conclusions since our study looked at a limited slice of the worldwide stock market-RM images on commercial web sites in three markets. It was also limited by the number of images searched, the brief period of the trial, and the level of tracking resources applied to an unpaid study overseen by a not-for-profit industry association.
Also, our study is now two years old and infringers' behaviors and the extent of the problem may well have changed in the meantime. We can, however surmise that unauthorized use of RM images on the internet represents the loss of significant potential revenue for stock distributors and the photographers they represent. But are we talking about tens, or hundreds, of millions of dollars in lost revenues?
Based on the study findings, SAA developed a "ballpark" estimate of the potential market value these infringing uses represent. We applied the infringement rate observed from the study to the rest of Getty Images' current RM collections. According to Selling Stock's recent count, there are just over 1 million RM images on gettyimages.com.
If we apply the 1:15 annual infringement rate observed in our study, we arrive at an estimate of approximately 67,000 infringements in a one-year period. Using an average license fee of $600 (a conservative figure, based on Getty's published rates for commercial web site uses), we calculate that these usages represent a market value of about $42 million per year.
So far, our estimate addresses only the three well-developed markets searched in our study-the U.S., U.K. and Germany. If together they account for about 60 percent of the worldwide market, our preliminary estimate of the annual market value of these usages then rises to about $67 million.
It's of course important to recognize that not all infringing uses can be converted into paid licenses. While the true numbers may well be significantly higher or lower, and while not all of these revenues are ‘recoverable,' this exercise hints at the extent of the problem-and the potential opportunity it implies.
We must also take into account the potential losses from other major distributors, smaller archives and self-marketing photographers. And, in order to gauge the broader extent of the problem, we must look beyond the scope of this small study-and beyond our estimate-to recognize several other forms of infringements that are not included here.
Consider the potential misuse of Rights Managed images in traditional print media, other digital uses, and in emerging markets. And what about Royalty Free images? In considering each of these additional factors we ask, "How can these infringing uses be converted into revenue for photographers and their distributors?"
Traditional Print Media
The majority of RM images are used in more traditional offline formats, such as print advertising, brochures, direct mail, marketing collateral, presentations and other traditional corporate marketing formats. While visual search technologies continue to improve their offline tracking capabilities and are now scanning and searching magazines and newspapers, we still have a limited ability to identify infringing uses of images embedded in print formats. These losses are not included in the estimate above and could well be even larger than online infringements.
Other Digital Uses
Our study was limited to commercial web sites in major markets. Consider the variety of other web and digital uses such as banner ads, pop-ups, HTML emails, images deeply embedded in flash files, digital displays, CDs, kiosks and wireless applications. Online tracking tools are just beginning to extend this deeply into online marketing and the estimate above includes nothing from these new and rapidly proliferating forms of communication.
Emerging Markets
The well-developed markets we studied have higher levels of copyright awareness, stronger copyright laws and more active policing than many other markets. We can speculate that the infringement rates in emerging markets are much higher than what we observed, suggesting another potential multi-million dollar missed revenue opportunity.
As these economies grow and their image needs escalate, the infringement problem could also grow. From the Getty 2005 Annual Report: "Innovations in broadband and mobile technology are opening up whole new categories of imagery demand; nowhere are these technologies growing faster than in the developing world." Indeed, the proliferation of websites in these markets will increase the demand for images-legal and otherwise.
Royalty Free
SAA's study looked at Rights Managed images only, but what about infringing uses of Royalty Free images? RF currently represents about half of worldwide revenues and much more than half of images licensed.
Although rights granted by RF licenses are broad, they are not without limit. RF images are also illegally copied and re-used by third parties, and there are good reasons to believe they are being infringed at a far higher rate than RM images.
RF images are more frequently used online, and widespread sub-distribution of RF images across hundreds of websites makes them readily available to potential infringers. These multiple distribution channels make it difficult to determine whether a given use is, in fact, unauthorized.
RF misuse is further fueled by a widespread misperception that a royalty "free" license implies unlimited use by an unlimited number of users. Without more vigilant compliance efforts, this widespread misperception is reinforced and further fuels image thefts. Furthermore, as enforcement and recovery efforts become more effective for RM images, we can expect that willful infringers will steal more of these difficult-to-track RF images.
It is not possible to sum up these various sources of infringements and define with precision the costs to the industry in terms of uncollected revenues. But we can conclude that scores of millions of dollars of revenue each year are not being realized from commercial websites alone, and that these losses are compounded by infringing uses of images in other formats and media.
