26 Jan 2008 iStockphoto Gives Contributors a Bonus
iStockphoto has effectively given all it’s contributors bonus royalties as part of the rollback of their international pricing scheme.
On January 7 iStockphoto implemented a price rise that they’d announced a month earlier. What they hadn’t announced was that customers buying credits in British Pounds or Euro would pay a premium. A small size photo became 1 dollar, 1 pound or 1 euro, despite the differences in the exchange rates of the three countries.
Contributors were happy as the higher priced credits resulted in higher commissions. Buyers in Europe, however, were not happy paying double (in Pounds) or 1.5 times (in Euro) for buying credits with their local currency.
After much debate on the forums, iStockphoto decided to roll back the discriminatory pricing on January 16 . They announced that all customers who’d paid the higher rates would be reimbursed the difference based on the exchange rate at the time of refund. However, contributors were told that they would keep the extra royalties they’d received, effectively creating an agency-funded contributor bonus.
A future change to international pricing hasn’t been ruled out, but iStockphoto CEO Bruce Livingstone apologized for the way it had been introduced this time. He was heavily criticized for implementing a strategy that was perceived as simply charging double in Europe. However, he also received a lot of praise for taking responsibility, setting it straight, and continuing to experiment for the benefit of iStockphoto’s various stakeholders.
Contributors were relieved when iStockphoto announced that there had been no drop in sales from the affected regions during the period of higher prices.
Photonomikon
Posted at 11:29h, 26 JanuaryYou almost got me excited there for a minute 🙂
Kirsty
Posted at 06:36h, 20 JanuaryThe stealth increases just keep on coming though.
As an iStock subscriber I object to my subscription credits being devalued during my subscription period. We were given no warning of the latest price increase, simply found I get less for my credits.
My subscription renewal this year is £2800+, compared to just £1500 last year for the same package of credits.
iStock are losing the plot, running the whole show for contributors and forgetting that it’s customers that make the world go round in business. With design work drying up for a lot of people, a price hike from iStock is the last thing they need and I suspect many will think twice before renewing subscriptions this year.