Permalink19 March 2009 at 17:42 by James West - Alamy CEO
Posted under News, Rambling CEO
The following email has been sent to all contributors who have images with us and to newly registered contributors.
Thank you for all of your thoughtful emails and comments on the blog. It's been very interesting to read your various perspectives and I appreciate your support in helping us find a workable solution.
Below are some of my thoughts in response to some recurring comments in your correspondence:
UK newspaper revenue for 2008 was about 1.8m USD (approx. 1.3m GBP), or 8% of our overall business.
Our assumption that the uniqueness of the images on Alamy enables us to keep away from subscription deals has been obliterated in recent weeks. Financial difficulties being faced by these customers have overridden the fact that Alamy has a better selection to offer than our competitors.
If we sit back and do nothing, over 1million USD in revenue will be wiped out over the next two years. That's an optimistic forecast - the truth is that we have no idea when or by how much this market will decline, but we know from recent experience that it has the capacity to fall dramatically and without warning.
Some of you are concerned that a subscription scheme will drive prices down to very low rates per image. In theory that's possible, but it's far from certain:
- Most newspapers are reducing the number of pages they print and are moderating their online ambitions due to budget constraints. I don’t envisage that picture usage volumes in UK newspapers will increase significantly over the next couple of years. If anything, they will reduce.
- Alamy is already one of the leading suppliers of stock imagery to the UK newspaper market. Alamy’s share of overall usage will likely increase if we do some deals, but not by a huge amount.
- 'Unlimited downloads' are the most generous terms we might offer. I don't want to run every commercial decision we make past all 17,000 of you, so I'm deliberately giving you the worst case scenario. In practice every customer is different, meaning that in some cases we might cap the number of downloads in order to preserve some lower limit on price per image.
I am not suggesting that we must compete head to head with newswire services. Nor am I suggesting that Alamy must transform the entire business into a subscription business, but for the UK newspaper business we must compete with other stock agency offerings – some of which come from agencies that also provide newswire services.
If you’re still unconvinced, please email Member Services, with the subject line “UK newspaper opt-out”, and we will exclude your images from any deals we do with UK newspapers.
If you are going to take my offer of an opt-out, please do something for me in return: wait and see. Don’t rule this out until you have had a chance to gauge the impact it will have on price and volume for yourself. You will be able to opt-out at any point in the future if you wish.
Apologies to those of you who would like an opt-in by pseudonym – I can’t justify the engineering effort at this time.
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