THE TERROR OF PRICE CHANGE
Out of the blue on May 26th, Shutterstock told contributors that a new earning structure has been set and will come into effect on June 1st. In this new system they will calculate the pay rate based on total sales. Meaning the more you sell, the more you get paid. Based on the sale numbers the contributors will be divided into six levels. A level 1 contributor who has less than 100 image sales will earn 15% per image, while a level 6 contributor who has more than 25,000 image sales will earn up to 40% per image. But there is still a catch: the final price depends on the image pack sold by Shutterstock. But Shutterstock wouldn’t be Shutterstock if they didn’t put another spin on this: they will reset all contributors to level 1 every year on January 1st. Their stated goal of rewarding contributors now looks more like squeezing pennies from contributors.
How levels are categorized in the new tier system:
- Level 1: Up to 100 (15%)
- Level 2: 101 to 250 (20%)
- Level 3: 251 to 500 (25%)
- Level 4: 501 to 2,500 (30%)
- Level 5: 2,501 to 25,000 (35%)
- Level 6: Over 25,000 (40%)
This will remove the current flat-rate $0.25 commission per picture, replacing it with the percentage system. The payout for subscription plans will not be less than $0.10. According to Shutterstock this change is to create “fair opportunities” for all contributors and to reflect the changes in the market.
What is tragic is that it is impossible for an average contributor to reach level 5 or level 6 in a year. When we take into account slow months and other unforeseen global problems, reaching level 4 will be impossible for most contributors. Even if they do manage to reach that level, all contributors will have to start from scratch from the 1st of January each year anyway. Their new system penalizes both average contributor and specialized microstock content creating companies as the tier system works in a way that enables Shutterstock to pay as little as possible.
This new plan does not seem to be rewarding successful selling contributors, but to make them quit the stock market. Every year the rat race will become harder and the profits lower. Before reaching a decent tier, contributors’ earnings will be poor and overall they will feel the decline in revenue more and more, especially when comparing it to previous years.
The cost of creating content is not cheap especially when models, props, and traveling is considered in costs. With this new system, there will be a roughly 50 to 60% drop in income compared to the previous system and the first quarter of each year will be a disaster for many contributors.
What many do not take into account are the years of experience, time, effort, proper keywording and the expensive gear, especially high end cameras and lenses that specialized content creators use. This new system will undoubtedly force them to rethink their continued presence on ShutterStock.