Who’s Killing Freelance as a Viable Career in the Creative Industry?

Mar 26, 2015

JP Danko

JP Danko is a commercial photographer based in Toronto, Canada. JP can change a lens mid-rappel, swap a memory card while treading water, or use a camel as a light stand. To see more of his work please visit his studio website blurMEDIAphotography, or follow him on Twitter, 500px, Google Plus or YouTube. JP’s photography is available for licensing at Stocksy United.

Who’s Killing Freelance as a Viable Career in the Creative Industry?

Mar 26, 2015

JP Danko

JP Danko is a commercial photographer based in Toronto, Canada. JP can change a lens mid-rappel, swap a memory card while treading water, or use a camel as a light stand. To see more of his work please visit his studio website blurMEDIAphotography, or follow him on Twitter, 500px, Google Plus or YouTube. JP’s photography is available for licensing at Stocksy United.

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whos killing freelance as a viable career in the creative industry

In my recent article “Who’s Killing the Photography Industry?”, I made the argument that photographers who choose not to charge licensing fees for the commercial use of their work are destroying the viability of photography as a sustainable career.

In the discussion that followed, I was very surprised that many readers viewed licensing as some sort of cash grab at best, with many voicing the sentiment that licensing is a relic that is no longer relevant to the reality of today’s creative industry.

I couldn’t disagree more – so in this article, I am going to expand a little on the value of licensing, and on a wider scale, look at who’s killing freelance as a viable career in the creative industry.

Business 101: Scalable vs. Non-Scalable Income

Before we specifically discuss who’s killing freelance as a viable career in the creative industry, we need to make sure that as creative professionals we understand the concept of scalable vs. non-scalable income.

Professionals that bill clients on an hourly basis are earning non-scalable income.

The example of prostitutes and lawyers immediately comes to mind.

There is a hard cap on the level on income a professional can earn by simply exchanging time for money – there are only 24 hours in a day and no matter how amazing a prostitute or lawyer you are, at some point the market will cap your hourly wage.

The advantage of exchanging time for money is its generally a safe, predictable way to generate income (safe referring to the method of income generation).

Scalable income on the other hand is not tied to the physical tasks that any one person can perform within a certain number of hours in a day.

With scalable income, you can literally make money while you sleep.

The advantages of scalable income should be obvious.  The disadvantages are that it can take a ton of work with little to no chance of a return to achieve the level of success necessary for scalable income sources to be profitable.

(By the way, scalable income is often referred to as passive income.  I don’t like the term passive income because it implies that you’re making money without doing any work.  The reality is that it takes a significant amount of time and work to build the infrastructure necessary to generate passive income – but once that passive income stream is in place, it has the potential to generate income far exceeding what would be possible by simply exchanging time for money.)

whos killing freelance as a viable career in the creative industry

Licensing Is the Only Way To Make Freelance Work a Viable Career

In the creative industry, we are very fortunate to have both scalable and non-scalable income sources available to us.

Commissions, day rates, bids based on hourly rates etc. are all examples of payment for time, or in other words non-scalable income.

We’re all familiar with bidding for jobs on a time for money basis.  However, licensing is our avenue to scalable income.

Without the ability to license artistic works for commercial use, freelance cannot be a viable career.

Think about it, no creative professional: visual artists, writers, photographers, film makers, musicians etc. can possibly produce creative works on demand from 9 to 5, forty hours a week.

We bid jobs, we manage our business and we exchange our time for money as often as possible – but unless you are in the top echelon of your creative profession and billing top rates – it is practically impossible to earn enough income to sustain a viable career.

This may sound harsh – but if you look at the financial performance data for multiple creative industries, the reality is that only the top earners make anything remotely close to a livable income level.

That is where licensing fits in.

Licensing creative works for commercial use allows us to build a scalable income stream over time.  There is a lot of work up front, but over time, licensing creative works is an opportunity to generate income that is not tied to the number of hours you work in a day and fills the gaps between paid gigs.

To those who are still uncomfortable with the concept of licensing, instead of thinking of licensing as a fee you charge your clients to use your work, it might be helpful to think of licensing as a reward for success.

In other words, the more successful your creative work is – ie. the more income it generates for the business that purchased a license – the more you are rewarded for producing something valuable.

And who could argue with artists receiving reward for success!?

(And always license your effing creative work for commercial use!)

whos killing freelance as a viable career in the creative industry

Let Us Know What You Think

Are you seeing a trend away from licensing in your creative industry?

Is licensing important to your long term financial goals?

Do you think licensing is a relic from the “good old days” and creative professionals simply need to adapt to the times?

Is licensing simply a cash grab racket?

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JP Danko

JP Danko

JP Danko is a commercial photographer based in Toronto, Canada. JP can change a lens mid-rappel, swap a memory card while treading water, or use a camel as a light stand. To see more of his work please visit his studio website blurMEDIAphotography, or follow him on Twitter, 500px, Google Plus or YouTube. JP’s photography is available for licensing at Stocksy United.

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14 responses to “Who’s Killing Freelance as a Viable Career in the Creative Industry?”

  1. G Allard Avatar
    G Allard

    Absolutely agree that licensing or “usage” rates should apply to every image that gets used. My contract language is very clear about the who, what, and where of image use and for exactly how long. This way the client knows what they are getting before the shoot and I keep my images/art protected for future use and copyright.

    The real challenge comes when the client does not understand the concept of licensing imagery. The more photographers out their educating clients on how the industry works, the better for all of us.

  2. Orion Avatar
    Orion

    A good follow up article would delve into the various ways to license said creative work. :)

    1. Addison Geary Avatar
      Addison Geary

      Photographers need to spend as much time learning business as they do on how to light or how to master photoshop. It takes time to learn the ins and outs of a fairly complex and multi faceted profession like photography. Seek out info from ASMP , EP, APA, NPPA, PPA . Business might not seem as sexy as HDR, High Pass filter or the latest strobes from ProFoto but earning a decent living is its own reward.

  3. Ari Kamin Avatar
    Ari Kamin

    What are your thoughts on licensing vs. selling outright? For licensing do you get a % royalty for the success of the campaign that uses your media?

  4. gregorylent Avatar
    gregorylent

    licensing, this is not a global concept, hence not a universal truth .. it is a local protection racket for distribution systems, using “the law”, in a few specific countries

    it won’t exist in fifty years, or even 25 .. best to think about how to adjust to the new paradigm

    1. Addison Geary Avatar
      Addison Geary

      No, because of poor business practices professional photographers will not exist in 25 years.

  5. Paganator Avatar
    Paganator

    Licensing fees are obviously very good for photographers as you explain, but they’re also obviously bad for clients. Licenses are expensive over time, they’re complex to manage (imagine managing the rights of hundreds of pictures, each with their own terms) and they’re restrictive (a company could be prevented from doing something as simple as posting a gallery of their old ads on their Facebook account because rights have expired, for example).

    As competition between photographers increases, it’s no surprise that pricing is moving toward a more client-friendly model. If clients can choose, they’ll go with the photographer who makes their life easier. This is especially true for smaller clients who don’t have the structure in place to track the usage of a bunch of different media.

    1. Addison Geary Avatar
      Addison Geary

      Licensing fees are good for clients too, they pay only for the use they need at the moment. Usage rights can be embedded into the meta data.

  6. Ahmet Avatar
    Ahmet

    I think the pre internet era it made sense. If you sold your photo for a big project, you wanted a bigger income. Since your work is part of the profit making. If it was a small scale thing, you had to realize that you get less or you won’t sell it, but obviously as a photographer you wanted a guarantee that your work won’t be used later for something much bigger. And that is fair. In those times it was rather straight forward, everything appeared on paper. it was easy to predict the scale of a work. Nowadays it happens on the internet. How many copies do you sell? One pic for their FB page? Is it one on their page or is it millions that got downloaded? Even your client won’t know in advance.
    You didn’t have to worry about removing the photos from magazines after the license expired. You just didn’t use it again. Now it is way much more complicated. A website is there continuously, you have to actively remove the photo after a period.
    Of course as a photographer it must be awesome to have income for the same thing over and over again.
    Also you can’t enforce it, so in the long run it will die out. How will you know that your photo was used on the other side of the world?

    1. Derek Sneed Avatar
      Derek Sneed

      this is what a contract is for.

  7. Sebas Td Avatar
    Sebas Td

    Just think what the stock photographer should do, charge by the hours ? non sense. They charge a 1$ and get .10$ but they are able to do it a multiple time for the same photo. They dont charge the 4hours of the shoot, the fees for make-up artist, equipment leasing, insurance and all the other cost. No a stock photographer charge a X amount for is picture that he will be able to charge again and again no mater how much time and money he invested in the picture. I the same for regular assignment photographer, they only charge less clients but at a premium.

    1. Addison Geary Avatar
      Addison Geary

      Many involved in this pricing structure “Microstock” are realizing that the only winners are the distributors. The internet made it possible for these distributors to exit it also makes it possible for the photographer to bypass these distributors and license images themselves using whatever model works for them and pocketing a larger share of the profits. If a client finds an image that works for their purpose they are willing to pay more than $10 to license it. As it is now photo buyers can’t believe their luck. Just don’t feed the beast.

  8. Ralph Hightower Avatar
    Ralph Hightower

    Scalar vs non-scalar makes sense. Scalar is “work for hire”, non-scalar is “Royalties”.

  9. Derek Sneed Avatar
    Derek Sneed

    I think a it does a lot of good to have realistic expectations going into creative work. I know that I entered into it with the expectation that everything would be rainbows and fun times and I would get to be CREATIVE, how could anything go wrong? I braced myself against “Naysayers” and set out to do my own thing.

    But it just doesn’t work like that. If it were that easy, everyone would be successful at doing it.
    Who’da thunk that in order to have a successful creative business you might have to utilize some business skills?
    You might have to analyze how you do things and position yourself to benefit from the structure of the market. You might have to learn how to read a contract. You might have to work out pricing structures, schedules, equipment rental, and lots of “non-creative” stuff.

    I just want every person (young and old) starting out to realize that honing your craft and making good work is just one aspect of working for yourself, and not to be afraid of the nitty-gritty details.

    Because the alternative is to work a boring, normal job that doesn’t allow for any expression of your creativity whatsoever. So why not put in that extra work, if you’re going to have to do boring stuff everywhere else anyway? It’s worth the toil to have a major aspect to your job that you absolutely love.