The Business of Free: Disruption or Destruction?

By Valerie Saunders

I have worked in the commercial photography industry for twenty years and have witnessed numerous disruptions. Stock photography disrupted assignments. The royalty-free license disrupted the rights-managed license. Digital photography disrupted traditional film photography. Internet marketing disrupted catalog marketing. Each stage and phase has raised questions and stirred angst for professional artists making their living through this creative medium. The digital revolution combined with the growth of internet commerce has created an environment of chaos for commercial content and media business models. Organizing media online so that it is effectively searchable and solving the riddle of how professionally produced content can be funded online have increasingly created obstacles for anyone who makes a living in the space of creative media. (McChesney, Digital Disconnect, p82). At this point, we are witnessing not only radical disruption but potentially destroyed established business models due to a massive shift in what drives revenue in online commerce.

coley-christine-240
Photo by Coley Christine on Unsplash

Unsplash – The New Reality of Competing with Free
The company Unsplash was founded in 2013 in Montreal, Canada, and is self-identified as a “Beautiful Free Photo Community” with subheading: “Do-whatever-you-wish HD photos. Gifted by the world’s most generous community of photographers.” (Unsplash.com) The CEO and Founder, Mikael Cho, spearheaded the broad adoption of this model of copyright-free photography when he was looking for images for his company Crew’s web site and either did not find something he liked, or found images that were pricier than what he was willing to pay. (Crew’s business model is to link graphic designers with clients though crowd-sourcing: crew.co) He hired a photographer to shoot a custom photograph for the web site and then provided the outtakes in HD online, via Tumblr, at no cost, with the permission of the photographer, for anyone to use in whatever way they wished. The site experienced 20,000 downloads in its first two hours. (Cho, Medium.com)

From that beginning, the company has grown to over 250,000 images submitted by 40,000 contributing photographers, and enables over 10 million downloads per month. (Cho, Medium.com) Their downloading clients include Apple, Squarespace, Everlane, Slack, FB Workspace, to name just a few. (Unsplash.com)

Photographers from around the globe upload their pictures, which are edited by Unsplash curators, for inclusion on the site. All photographs uploaded to Unsplash enter Unsplash’s Creative Commons Zero license, equivalent to a public domain license, or copyright-free license. If a client-user clicks on a contributor’s photo and then onto their Unsplash profile, they will have access to all of the photographer’s uploaded pictures—whether they were selected by the curators for visibility on the platform or not—to download at no cost, and can copy, alter, or distribute them, or use them for products, prints, billboards, commercial advertising, editorial uses, or anything else, even to re-sell the image itself, though the company “discourages” this. They also say it would be nice to include credit for the photographer, but it isn’t necessary. (Boguslawska, Petapixel.com)

Unsplash identified and exploited an inefficiency in the marketplace for image licensing. First time clients and those unfamiliar with licensing creative content become ensnared in the “hassle” of obtaining a license for a photograph, the cost of paying for the license, and then adhering to the demands of the particular license they have acquired. All of this becomes unnecessary when using pictures under the CC0 license. Their process is entirely friction-free. End users do not even need to register on the Unsplash site to download its High Resolution photos.

So who benefits from this model and in what ways? For any person or company wishing the freedom to use high-resolution pictures at no cost, with no licensing restrictions, the benefits are clear: zero restrictions, zero cost. However, what’s in it for the photographers who are willingly uploading their images to Unsplash? Why do they choose to offer their pictures, no-strings-attached, to be downloaded for free in perpetuity? Cho remarks: “it’s this extreme level of giving that produces the unprecedented level of connection.” (Cho, medium.com) The theory on the photographers’ benefit is tied to the idea of generating exposure, building an audience and a following, and this attention—this “unprecedented level of connection” that Cho offers—may potentially lead to paid commission assignments for some photographers or collaborative projects that generate revenue by building business relationships. While theoretically possible, every submission makes for a potentially more robust free collection that effectively drains the industry of paid collaboration opportunities.

Cho does not “explain the potential impact that giving images away for free could have on the value of images.” Presumably no one will pay for an image if they can find a comparable one for free. (Risch, PDNonline.com)

If large companies with substantial budgets, such as those listed in Unsplash’s client list, are using this site to download for free instead of paying for a commercial license, won’t they continue to do so as long as they can find something usable on the platform? As Unsplash grows, more free photos will be available, making it less and less likely that any particular photographer is going to land one of these coveted paid assignments. And all the while the image downloaders are being acculturated to the normalcy and expectation of free. The traditional industry of copyrighted photography will suffer. How do you price your work to cover the cost of professional production, let alone cover living expenses in an environment that creates this level of pricing pressure? Sure – it is disruptive, but it is also destroying a creative industry’s viability.

What is conspicuously missing from interviews with Cho and blog posts about Unsplash, is the business strategy that is most certainly incubating to monetize what they have built. The web site is beautiful. It carries no advertisements. Web hosting, image curating, cloud space, API capabilities, and extensive marketing, are all being paid for by previously raised capital of $3.5 million. Raising capital would necessarily imply that a business plan for eventual capital gain has been shared with investors. Cho explains that Unsplash was originally a loss leader for Crew and that it isn’t currently making any profit. (Calore, wired.com)

As for Mikael Cho and his team at Unsplash, though he focuses his message on love of community, there may be a significant payday in his sights. Crew was sold in 2016 (amount undisclosed). His priority is now to work on Unsplash. With the volume of traffic coming into Unsplash it is a brand that has value for anyone looking to capture eyeballs or track user data. The end game could likely be a sale to a larger company or an IPO that is perhaps at odds with the community vibe (and the notion that it is all about sharing and being generous). The product (in this case, photography) is not the business. The business is clicks and data. It is an entirely different kind of disruption.

They are peddling free, but the story may hold a twist. As we examine this pattern, is it logical to see this relationship as one more piece in the machine that drives and reinforces income inequality? The creators of the product are complicit in the arrangement, providing their intellectual property at no cost with no copyrights, for a shot at being noticed by “the audience.” Big business does not have to pay and even makes money off the backs of free creative content producers. And as the arrangement proliferates, the likelihood of making real money for photography by the small individual producer diminishes, even as that product has true value to the companies that freely use it. Ultimately the value of customer data and audience-building may eclipse the value of pictures. That trajectory has nothing to do with the quality of the image, or whether the creator is amateur or professional. It simply creates a definite benefit for the commercial users who download free content, and a perceived, but questionable, upside for the generous contributor.

Sources:
McChesney, Robert W. (2013) Digital Disconnect: How Capitalism is turning the Internet Against Democracy, pp 63-95.

Cho, Mikael. (2017) Medium.com, “Hello Unsplash, Inc” https://medium.com/unsplash-unfiltered/hello-unsplash-inc-ce02b1c79d23 retrieved Sept 11, 2017

Cho, Mikael. (2017) “The Future of Unsplash” https://medium.com/unsplash-unfiltered/the-future-of-photography-and-unsplash-811f114aab7a retrieved Sept 20, 2017

Risch, Conor. (2017) PDNonline.com, “Unsplash CEO Tries to Justify Copyright Grab” https://pdnpulse.pdnonline.com/2017/08/unsplash-ceo-tries-to-justify-copyright-grab.html retrieved Sept 23, 2017

Boguslawska, Aleksandra (2015) “Why Unsplash is Hurting Photographers”, Petapixel.com, https://petapixel.com/2015/01/08/unsplash-hurting-photographers/ retrieved Sept 13, 2017

Cho, Mikael. (2017) “I Started Unsplash”, https://medium.com/@mikaelcho/i-made-unsplash-and-now-i-m-making-a-book-eaa8e947ad78 retrieved Sept 18, 2017

Calore, Michael. (2017) “The Web’s Premiere Free Photo Library Opens Up Its Vaults”, Wired.com, https://www.wired.com/2017/05/unsplash-api/  retrieved Sept 23, 2017

Unsplash.com, https://unsplash.com, “About” retrieved Sept 11, 2017

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