14 May 2008 Shutterstock Raise 2008
Few events are as eagerly anticipated or create as much talk in the market as the commission raise at Shutterstock. In what is becoming an annual event, this year Shutterstock have increased the number of tiers in their commission schedule with new commissions ranging from 25 cents to 38 cents.
|Less than $500
|$500 to $3,000
|$3,000 to $10,000
Extended license sales have risen from $20 to $28 (40%). Footage, backup CD and referral fees remain unchanged. More details on the Shutterstock forum.
The raise took effect within a couple of hours of the announcement.
Reaction from contributors has been mostly negative, stating the raise is insufficient and that smaller contributors miss out entirely. Speculation of raise details was fast and furious since the announcement back in February, so a common complaint has been the amount of build up Shutterstock gave the raise announcement. More so because the announcement stated that contributors would be “pleasantly surprised” at the size of the raise.
Other common complaints included comparisons of the 50% rise in subscription fees to the 10-27% rise in commissions, and comparisons to the commission rates at other agencies. In fact the 50% price rise figure quoted so many times is a fallacy as prices only rose 26%. Many complaints were worded strongly and contributors threatened to upload less and leave to contribute exclusively at other agencies.
Not all comments were negative. Some contributors noted that Shutterstock likely lost a portion of buyers after the price rise, which helps to explain why the commission raise was proportionately lower. Others cited hard work as the missing ingredient for those who didn’t get the high 27% raise.
A recipient of the highest raise, Sean Nell, offered explanation for the heavily tiered structure by way of the 10 million uploaded files that have been rejected since Shutterstock opened. “Have you considered what it takes to pay reviewers to have to “educate” submitters who is still learning what it takes to make it in microstock?”
Others defended the criticism of low per-sale commissions by citing Shutterstock as being among their top earning agencies, delivering a large portion of their microstock earnings at the end of each month. Additionally, the price rise didn’t take effect for subscribers until they renewed, which could be up to 15 months if they auto-renew.
In the Market
iStockphoto has stolen some of the attention from Shutterstock this year by announcing its subscription service which is structured so that contributors stand to earn more per sale than they currently do with credit based sales – effectively a raise in commissions. This move represents an opportunity for iStockphoto to gain some business from Shutterstock who still convincingly dominate the microstock subscription market and in doing so attract more contributors into their exclusivity program. The widespread disappointment with Shutterstock’s raise can only serve to further push more contributors that way.