22 Nov 2007 Exclusive Buyout – Cashing In Your Photos
What is an Exclusive Buyout?
Almost all photos in the microstock market are sold with a Royalty Free license which is non-exclusive, meaning many people can use the photo simultaneously. When buyers want exclusivity they need an exclusive buyout. They pay a high price for it, but you can’t sell the photo anymore.
How Do Exclusive Buyouts Occur?
Exclusive buyouts occur despite the fact that most photos have already sold many times with a Royalty Free license. The rights of the previous buyers are unaffected, but neither the photographer nor buyer can sell new licenses for the photo.
Dreamstime are the only microstock agency who facilitate exclusive buyouts within their system. It’s called Sell the Rights and is one of their Extended Licenses (SR-EL). It’s optional for contributors and they get to set the price. Most other agencies are happy to manually facilitate an exclusive buyout sale by contacting the contributor and negotiating on their behalf.
How Much is an Exclusive Buyout?
StockXpert recently facilitated an exclusive buyout for US$10,000. The contributor received 50%. Dreamstime’s record for the highest exclusive buyout sale is currently US$5,100, where the contributor also received 50%. According to Dreamstime’s CEO, Serban Enache, the average SR-EL sale price is “significantly above US$1,000”.
Dreamstime provide a recommended price when you enable the SR-EL option, which is based on the photo’s sales performance since it was first approved. The figure is dynamic so it goes up if the photo sell well. The minimum price a contributor can specify is US$350 and the maximum US$10,000.
When setting the price, contributors must estimate the potential earnings of the photo across all agencies where they contribute. If the photo is part of series, they must estimate the potential earnings of all similar photos from the same shoot, as most exclusive buyouts require that these are also withdrawn from sale.
What Happens After an Exclusive Buyout?
The photographer must immediately remove the photo and all similar photos from sale at all places where it is available. Dreamstime requires it to be complete within 72 hours.
When selling a photo by exclusive buyout, photographers need to be aware of notice periods that may prohibit them removing the photo immediately. However, most agencies can accommodate requests to waive notice periods for single photos. This is often the case when a Dreamstime buyer requests an exclusive buyout of a photo that doesn’t have the SR-EL enabled.
The buyer receives the file, and usually any RAW file that exists. They receive any applicable model releases but without any identifying details. They have almost full rights to the photo, but cannot sell the photo as a digital file or print. It may be printed on a product for sale, or used in a logo.
Serban Enache also highlighted that most SR-EL sales at Dreamstime are for use “…within a specific industry, with exclusive rights for a limited time interval. That makes the license very similar to a regular [Rights Managed] deal…”
How Common Are Exclusive Buyouts?
Despite the hurdles to a successful exclusive buyout in the microstock market, they still occur quite frequently. All top microstock agencies receive requests from buyers and most negotiate them through to a successful sale.
If you’re interested in the potentially large one-time payoff of exclusive buyouts, ensure you activate the SR-EL option at Dreamstime. While buyers occasionally contact Dreamstime support to offer and negotiate for photos without the option activated, they’re more likely to search for one already activated and the price already set.