Common Cents:

Getty: SOLD
March 2008

by Mark Loundy

"Not just in commerce but in the world of ideas too our age is putting on a veritable clearance sale. Everything can be had so dirt cheap that one begins to wonder whether in the end anyone will want to make a bid."

— Soren Kierkegaard

When I was just a pup, J. Paul Getty was a reclusive American billionaire who had made most of his money in oil. His grandson, Mark Getty, was bored with moving dollars between investments and wanted to get the family money back into active commerce. He saw gold in the fractured image-licensing business and, with a little help from the family fortune, he founded Getty Images in 1995.

After a few heady years fueled by the computerization of image collections and online distribution, the company lost favor on Wall Street. The stock price fell from a peak of $56 in early 2007 to less than $24 in mid-February of 2008.

In January, Mark Getty announced that the company was "exploring strategic alternatives." Translation: Getty Images is for sale.

But the company faces a perfect storm opposing its efforts to attract a buyer. The downturning economy is depressing print advertising sales, where Getty makes much of its revenue. The general trend of ad dollars to online media is far less profitable. Plus, the credit crunch is strangling the capital engine that drives most corporate acquisitions.

Add to the above the increase in competition from companies such as PhotoShelter and you can see that Getty Images has quite a challenge ahead.

[Since this article was originally written, Getty Images was acquired by the investment firm Hellman & Friedman for $2.1 billion. While this will take immediate cash flow pressure off of Getty, H&F is not in it for the glory. They will expect to make a significant amount of money from the buyout. The deal is expected to close before summer.]

The Good

• National Geographic Books (Children's Books) for having no problem accepting a contributor's terms and rates when they conflicted with NGB's own contract.

The Bad

• Stillwater Publishing for their offer of "about $20" to license an image. "About" $20? Might it be even less?

The Ugly

• Not so Ugly this month.

Please let me know of any particularly good, bad or ugly dealings that you have had with clients recently. I will use the client's name, but I won't use your name if you don't want me to. Anonymous submissions will not be considered. Please include contact information for yourself and for the client.


• Hourly rates are usually a bad idea. They give the client the idea that the value of your work is based on how long it takes for you to create it. But there is one situation where hourly is a good thing. When you're asked to do revisions or lots of repetitive post-production work, pre-arranged hourly rates can work in your favor in two ways: If you set your hourly rates relatively high, the client will be discouraged from making ticky-tacky revision requests. If they really do need the work done, the hourly work can be an additional profit center.

• The newspaper market continues its transformation as The Capital Times lays off much of its staff and moves to an online emphasis. The 90-year-old Madison, Wisconsin-based daily will retain a twice-weekly print edition. Three of its five photo positions are being eliminated.

• Sales tax can be a slippery issue. Laws and regulations vary from state to state and often between counties. But if you're in California, there is help at hand. Photographer Paul Antico and the Advertising Photographers of America have created a flow chart to determine if a given job is taxable.

Cigar Aficionado magazine used to waive their all-rights contract if asked, but no more. Enough photographers have placidly rolled over for them that the editors are no longer negotiating.


APA Sales Tax Flow Chart

Wisconsin Daily Moves Online

NPPA Independent Photographers Toolkit

Advertising Photographers of America Business Manual

Common Cents Column On The Cost of Doing Business

Editorial Photographers

Editorial Photographers Yahoo! Group (Message Archives)

Small Business Administration

NPPA Online Discussion Group Instructions

© Mark Loundy

Mark Loundy is a visual journalist, writer and media consultant based in San Jose, California.