23 Aug 2007 Understanding Royalty Free

There’s always a little confusion about Royalty Free licenses and how they affect the selling of your images. Here’s what you need to understand about Royalty Free when selling your photos in the microstock market.

Selling Photos Royalty Free

First, understand that when we say “selling photos” we’re really talking about “licensing photos“. Royalty Free is simply one of the licensing models. Its fundamental principles are:

  • Multiple simultaneous use – many different buyers can buy the same photo and use it at the same time
  • Pay once, use many – once purchased, the photo may be used in an unlimited number of projects
  • Indefinite use – the license does not expire, so the buyer can use the image for an unlimited period of time

Be aware that these are general conditions of Royalty Free and may be altered or offset by the specific license agreements of microstock agencies.

“Royalty Free” doesn’t actually mean that the license is free of royalties. The “royalty” is what is paid to the photographer, distinct from the “license fee” which is paid by the buyer. An intermediary, such as a microstock agency, collects license fees from buyers and pays royalties to the photographers.

What’s the Alternative?

Rights Managed image licenses are distinct from Royalty Free licenses. License fees for Rights Managed images are calculated by multiple factors including the quantity of reproductions, the type of use, the region of use, and the time period of use. If the image is used more than once, more license fees must be paid. Images sold with a Rights Managed license require that the image is continually managed and cannot be sold to multiple people at the same time. This makes them unsuitable for the low prices and many sales approach of the microstock model.

Are There Any Limits?

Absolutely. The limits vary with the individual license of each particular agency, but they all impose limits on the quantity of reproductions and use of the image on items for resale. This is where Extended Licenses take effect, permitting the buyer to pay more to remove some of the restrictions.

  • Ellen Boughn
    Posted at 11:43h, 23 August Reply

    Thanks for the definitions…but your statement ‘Rights Managed image licenses require royalties to be paid’ is a little misleading. ‘Royalties’ is used to describe the fees that are paid to the photographer for both rights managed and royalty free. The fees that the USERS pay are called “licensing fees” and are also paid for both RF and RM. The RM fees are calculated based on a complex set of usage rules while the RF fees are, as you described, one shot deals. The name ‘royalty free’ is a misnomer and was thought up by the first guys in the RF business. We have had to live with it ever since. But then if I’m so smart do I have a better idea. Nope!

  • Lee Torrens
    Posted at 13:30h, 23 August Reply

    Thanks for setting me straight (again) Ellen. I can always count on you.

    I’ve updated the post. Thankyou.

    – Lee

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