18 Jan 2016 Pond5 to Launch Contributor-Friendly Unlimited Subscription
When entering a competitive market with an innovative business model, it’s better if your model can’t be easily replicated by the giants that already dominate the space. Videoblocks likely thought this was the case with theirs, given their model requires a large collection of wholly owned content that would take a lot of time and money to replicate.
But it seems Tom Bennett wasn’t as idle as some suspected, having found a way around the problem of building a large collection to offer with an unlimited subscription. Pond5 will soon launch a new paid membership with unlimited access to a portion of their stock footage collection, which is the largest in the market.
The Pond5 Membership Collection
The entire stock media industry is still grappling with how to make unlimited subscriptions work.
Pond5’s model is a variation on the Videoblocks implementation, with some innovative twists. Like at Videoblocks, members will pay a monthly or annual subscription for unlimited access to ‘The Membership Collection’, which will be sourced from under-performing files opted in by contributors.
Subscribers will also get discounts on purchases from the regular collection.
The Deal for Contributors
To build the Membership Collection, the company has started reaching out to contributors with details on the offer and stats on their low selling files. Contributors are free to participate, opting in their low-sellers which will be screened for inclusion in the collection.
For video, minimum monthly royalties are guaranteed for all files included in the collection, regardless of downloads and usage. They’ll be paying $0.50 per item, per month, for every clip in the collection. If the total subscription revenues exceed this minimum rate, the excess will be split 50/50 with contributors, based on item performance.
For illustrations, they’re offering a flat $1 royalty rate per item, per download. It’s likely this will be the case for photos too.
As the content in the Membership Collection will still be available at the marketplace, it’s anticipated that this initiative will both add a new revenue stream and increase organic sales.
For now participation is by invite only, and there’s a 120 day notice period if they later choose to opt-out.
The new product will be launched along with a large marketing campaign, a new direct sales team and a website rebranding.
While Pond5’s Membership Collection provides customers with a similar proposition to the Videoblocks offer, there are still substantial differences, especially on the contributor side.
Videoblocks is paying contributors 100% royalties for all sales, while Pond5 will retain its 50% rate, yet Videoblocks undercuts the market on prices while Pond5 allows contributors to set their own prices.
Videoblocks doesn’t have any program for contributors to include files in the unlimited collection. Adding to that collection is a direct cost for Videoblocks, while Pond5 can grow theirs at scale through the contributor opt-in.
Let’s also not forget that Pond5 raised $61M in funding last year so can better afford to subsidize a customer acquisition strategy with this model, potentially starving out Videoblocks.