A "Rose" By Any Other Name Would Smell As Sweet

Though Katie Couric won't be reporting it, there's good news from Washington, DC for a change. In the rush to get re-elected and pass some very important legislation, such as dismantling Habeas Corpus(?), before hitting the campaign trail, Rep. Lamar Smith (R-Texas) announced that he was withdrawing the Copyright Modernization Act of 2006 (HR 6052) from consideration at the current mark-up session, which is likely to be the last one this year. The good news though is tempered by some bad news as well: he said that he plans to introduce another bill when the new Congress convenes next year.

Just the same, a win is a win is a win... and a rose by any other name would smell as sweet. But we've only won a battle, not the war. We'll be watching intently to be sure that the bill does not rear its ugly head in a "lame duck" session, and ASMP will begin work on drafting our own version of a new bill, favorable to photographers and artists, for possible introduction in the next Congress.

The efforts of ASMP members and our allies in the creative community in representing and organizing members' opposition to the bill... plus all of your faxes and letters have played a major part in killing the legislation, not to mention some keen lobbying by our ASMP crew. Rep. Smith's scheme of tying the Orphan Works amendment to a digital music licensing bill appears to have put us over the edge in creating the critical mass of opposition needed to stop the bill in this Congress.

Should we be celebrating? Well, like I said, a win is a win is a win, but you can bet that this will come around again next legislative session. En garde!!

Business 101 – Why I look Up To My Dentist & You Should Become A Plumber

I’m constantly struck by how many people in our business don’t understand, well, business. Those of you who’ve been following along know well that this is a pet peeve of mine. If I have to write on this subject just one more time you're going to have to pay for a subscription to read here. Anyway, once more, someone wrote asking why he should mark-up his costs when charging them to his client as line items on his invoice. The names have been changed to protect the ignorant.


Jon wrote:

"...bloat travel expense estimates to cover the just-in-case? OK, but I feel it's less than forthright to expect to profit from it."


Why go into business if you don't think it's right to profit from your work?

The price of just about everything is going up, not down. If your travel expense (gasoline) increases, your charges for travel must increase to compensate.

Profit is the reason one goes into business. Money is the reason one goes into business. Loving what one does is a perk, a fringe benefit, a bonus, but it's not the reason to go into business.

If you became a photographer because you love doing it, you should have been a dentist... they all love photography and have Hasselblads with digital backs and take vacations on which they use them. Some dentists are actually quite talented, and they can all afford all of the photography gadgets and doodads their hearts desire. Why? Because they have no qualms about marking up their cost of doing business and making a healthy profit.

I'm as good at what I do as my dentist is at doing what he does. He earns $200,000 + per year, drives a Land Rover and lives in a big house up on Prospect Avenue. If I fail to profit I'll never earn as much as my dentist does (and why shouldn't I?) so I charge $1.00/mile to drive my car to a shoot. Any client that doesn't want to pay my mileage rate can have me rent a car/truck/van and pay my mark-up on the rental.

My dentist looks up to me because he envies the fact that I'm not chained to an office eleven months a year. I travel and make pictures for a living and give him my calendars and posters and other cool stuff to hang in his office.

I look up to my dentist because every time I see him I'm reclining in his chair and he's towering over me with a sharp instrument or a power tool and I'm paying him $300 a half hour for the privilege.


Jon wrote back:

"At my last job(s) I would travel for business. I was either given a corporate card or I paid my own expenses and recorded them on a reimbursement form for travel, food and incidentals. In the interest of keeping my job, I recorded exactly the amounts of those expenses, no less, no more. I didn't expect to make a profit on them. I made a profit on the work I was doing."


Here's the essential difference: At your "last job" you were an employee and not entitled to make a profit from your work. Profit is reserved for the owner(s) of the company, not you. You were an employee. You did not profit from your work, your employer profited from your work. You earned a salary and were reimbursed for your expenses.

As a business owner, you don't invoice for reimbursement of your expenses. You invoice for Creative Fee/License to Use (includes usage) plus PRODUCTION CHARGES. Expenses are what we have (and we deduct from our gross income on our tax returns), production charges are what we invoice to our clients.

This is Business 101. Pay attention y'all... if you don't mark-up your expenses and convert them to production charges then you are a) not doing business correctly and b) ruining the marketplace for those of us who do.

I revert to my favorite question for a client who balks at paying $30 for a roll of film and processing (now digital fees, etc). When challenged on an item like that I always ask: "Are you wearing shoes?"

client: Yes, of course.

JP: "Good, how much did you pay for them?"

client: I dunno, about $95.

JP: "Uh huh, and was that the price as marked in the store?"

client: Yes.

JP: "Did you hassle the store owner and ask to see his receipt for the wholesale price of the shoe and offer only that, or did you pay the marked price at the register?"

client: It's not the same Joe, I can get a roll of film at K-Mart for $6.99!

JP: "It is the same. Because you can get a piece of leather for $6.99 too, but it ain't a shoe; and you can buy a shell steak at ShopRite for $10.99 but you can't take it to The Palm and have them grill it for you for free. A Shell Steak at The Palm is going to be $55.00. Don't even suggest to the waiter that he give it to you for less because supermarket beef is only $10.99/pound, he'll throw you out on your ear. You can buy a roll of film for $6.99 but it won't have my pictures on it, it'll be blank."

JP: "The price of a shoe reflects a lot more than the cost of the materials. The manufacturer has to purchase materials, finance the purchase, design, cut, finish, sew, attach, ship, advertise, invoice, collect, pay salaries, repair machinery, print stationary and business cards, telephone, employee pensions, health plans, utilities, process returns, pay rent or purchase real estate for their facilities, have the place cleaned daily, entertain buyers, pay for a trade show booth, maintain a motorpool, use postage, have insurance and much, much, more."

Now, can you do all that with YOUR business without marking-up your costs?? No, Jon (and everyone reading here), you cannot. Pay attention to this, it's key: Your profit is derived from the mark-up on your costs of doing business.

The shoe manufacturer must profit so they can remain in business, produce new designs, etc. They can't charge you just what it costs to make the shoe, they'd go out of business. You need to profit too. You need to produce new portfolios, update your version of PhotoShop, buy a new Mac once every few years, replace your digital cameras every 18 months, fix stuff, save for your retirement, replace the car you're not charging a dollar a mile to drive. How are you going to do that? Sponge off your parents? No (unless you're a creep, how would I know?), you need to mark-up your costs and make a profit to fuel your growth.

In every other business... every other business... mark-ups are applied to the cost of goods sold or consumed in a manufacturing process. That's why your shoes are $95 rather than $25: the materials, labor, packaging, shipping, advertising, insurance, wages, energy consumed, etc, etc has been marked-up to insure the company's profit. Our businesses should be no different.

Those who labor under the belief that photography businesses are somehow "special" and immune from the established market practices and forces are wholly incorrect, regardless of how strongly one believes it or how many of one's peers feel the same way. Those who depart from established business practice threaten to destabilize our industry and therefore make it more difficult for those who adhere to established principles to continue to prosper from their businesses.

You've got to understand that if you fail to profit you'll be a poor yutz all your life and you'll make it more difficult for all the others, who actually understand how all of this works, to earn a proper living. Don't drag my business down with yours simply because you don't understand business fundamentals. Become a plumber and drag that industry down for lack of business skills, LEAVE PHOTOGRAPHY ALONE! Please!!!!

Class dismissed.

It’s The Internet. Stupid?

This was the President's Message I wrote for the Summer, 2006 issue of "Exposure," ASMP New Jersey's quarterly magazine.....


"It’s The Internet. Stupid?"

No matter if you’re a Democrat or a Republican, surely you recall that James Carville, the brilliant political strategist who ran Bill Clinton’s presidential campaign, hung a large banner in the campaign’s office that read: “It’s The Economy, Stupid!” Members of the press saw that banner and made it the story. Regardless of whether President George H. W. Bush’s economic policies were on/off target, the economy became the focus of the campaign and he looked like a loser. So much so that he was one of the few sitting Presidents of the 20th Century to lose a re-election bid.

In the good old days of the Reagan-Bush presidencies commercial photography looked like a great career choice. Photographers were doing a land-office business... it was booming. Business continued to hum along pretty well throughout Bill Clinton’s first term, too. Then, in 1997, just months into Clinton’s second term, the age of Big Media companies descended upon us.

Haven’t we always worked for Big Media? What’s Time Inc., or J. Walter Thompson? Aren’t those Big Media companies? Yes, but I’m not talking about the Big Media companies that are our clients, I’m talking about the Big Media companies that are our partners.

The watershed event that I refer to was the beginning of the consolidation of the stock photography industry. Mark Getty, the London-based MBA and scion of the storied oil family was looking for the, “oil of the 2ist Century,” and he found it: Intellectual Property. He’d seen the advent of the world wide web in 1995 and he came to the realization that he who controls Intellectual Property will be the “oil baron” of the future just as his grandfather, J. Paul Getty, was the oil baron of the past. Mark Getty is an intelligent man, perhaps a visionary, but he’s not the only one. Half a world away, in a corner office in Redmond, Washington sat a Harvard dropout named Bill Gates, and he came to exactly the same conclusion.

In the years following, Getty Images and Gates’ Corbis Corp. moved swiftly and smoothly through the stock photo industry and gobbled it up. Stock agency after stock agency was consumed until it seemed there were none left. Maybe, just maybe, they missed a few crumbs.

I don’t know which was first, but Getty Images long ago removed the term "agency" from its contracts. They became a licensee, as did Corbis. With this subtle change of status, these licensees began to do what agencies could not: absolve the corporations of the fiduciary duty to the photographers they represent.

Photographers seeking safe harbor were drawn to a beacon in the darkness, a new agency established by Alexis Scott of Workbook. Ms. Scott, highly regarded by photographers who had advertised in The Workbook, began recruiting a select few photographers to her new venture. It wasn’t long before the masses flocked to workbookstock.com, which showed promise because of its name recognition and its photographer-friendly demeanor.

I knew, though I didn’t know when, as soon as WBS began encroaching on the 800 pound gorillas, one of them would swallow it whole, just as they’d done to the rest of the stock houses and, in discussions on various online forums I said as much: “workbookstock.com is for sale.”

I was immediately inundated with e-mails from WBS staff, as well as Alexis Scott herself, all vehemently insisting that WBS is not for sale! Just when it was looking like I was dead wrong, just a few days ago, I received a press release from Jupiter Media, an upstart among the mega stock consolidators, touting their acquisition of..... you guessed it: WorkbookStock.com.

This caused an uproar in the online stock photo forums with one of the correspondents writing, “Why do stock shooters automatically hate big agencies and buyouts?”

The problem is that the big stock companies’ goal is to dominate their market. They’re run by MBAs who are not “picture people,” rather “money people.” For Getty, Gates and Meckler (Jupiter’s CEO) it’s all about money, not pictures that make money. As mega-corporations, they can dictate terms to photographers rather than act as partners in the stock endeavor. Their businesses are run for the exclusive benefit of their shareholders rather than sharing the benefits between photographers and photo-marketers.

Those who’ve been tracking the consolidations have been following the statements of Jonathan Klein of Getty Images since 1997. He openly avers that what Getty is about, and what Getty needs to do to please investors, is decrease expenses and increase dividends to shareholders. What’s the number one expense to reduce? Photographers’ royalties. Getty intends to accomplish this, so Klein says (publicly!), by increasing Getty’s wholly-owned content.

Jon Klein’s not a demon, he’s a smart and savvy businessman. He’s also not alone! Corbis has the same intent and Jupiter... well, Jupiter Media is way out in front in the race for wholly-owned content.

Stock agency buyouts have been devastating to stock photographers, but where else can you go in an industry dominated by a few conglomerates doing the same thing? To the Internet. Stupid?

Not only are we in the age of Big Media, we’re in the age of Big Search. google and Yahoo! have established sophisticated image search capabilities. You, and your pictures, can be easily found if you have a web site and a basic knowledge of keywording. It may sound daunting, but this is actually not very difficult at all.

I’ve recently discovered the “blogosphere.” Anyone can have a really professional looking web log or “blog,” and you can have it for free. If you have a good niche in which you operate, with proper keywording you can compete with the mega stock companies and it’s only going to get easier and easier. It’s the Internet. Stupid?

More On "Orphan Works"

If you've been following along, the Orphan Works amendment story has been a start-stop, hurry-up and wait affair. At each stage I've asked you to write letters and fax them to your representatives in the House & Senate, as well as the members of the House Judiciary Committee. Your participation in the effort to defeat this proposed legislation is crucial to any progress we might make in this area. If you've had your fax machine humming then I thank you on behalf of the entire creative community. If you haven't been a faxmaniac.... c'mon, get with the program.

Just when we thought this amendment might actually die in committee, it was revived as the Copyright Modernization Act of 2006. Oy!

The good news is that the CMA may well fall off the table this session as legislators tackle "more important" stuff... and then pack-up and hit the campaign trail for the mid-term elections, just six weeks away.

This morning Judy Herrmann, who sits on ASMP's national Board of Directors, reports that for the second time in 2 weeks, Rep. Lamar Smith tried to get the larger CMA, which includes an amendment addressing Orphan Works, included in the House Judiciary Committee's mark-up session. The "Copyright Modernization Act of 2006" focuses primarily on the music industry and includes the Orphan Works language from HR 5439 on pages 86-96 of the 100 page document.

The new bill had been placed on the mark up calendar for the House Judiciary Committee meeting last Wednesday and again yesterday. Fortunately for photographers and other visual artists, it was dropped from the committee's schedule in both sessions.

Vic Perlman, ASMP's in-house counsel, has added his report on the new bill to ASMP's Orphan Works web resource at http://www.ASMP.org/orphanworks

There's also a very informative article about the new bill at: http://www.stockasylum.com/text-pages/articles/a6fa092006-new-ow.htm

ASMP is working closely with other industry associations to delay the passage of this bill in the hope that the language can be improved. As Vic's latest report shows, significant hope lies in the fact that Chairman Smith has agreed to offer an amendment requiring the Copyright Office to develop a searchable on-line database of copyright registrations that includes digital copies of the deposit materials. This would delay the effective date of the bill until the Copyright Office has a functioning system in place. While this does not address all of ASMP's concerns about the proposed Orphan Works amendment, it represents a significant step in the right direction.

The bill may be presented again before the current session ends but with every day that passes, the hope that this session might end without this amendment passing increases. Even if we get through this session, it's almost inevitable that some kind of Orphan Works legislation will be passed in the near future. So, while Vic's fighting the good fight in Washington, ASMP is also actively seeking solutions that will help protect visual artists should this or a similar Orphan Works bill be proposed.

Your mama don't dance and your daddy don't rock 'n' roll

"Your daddy's rich and your mama's good looking,
so hush little baby don't you cry."

The amount of grief I'm getting for being illiterate is astounding. Already looked up Gershwin, Cole Porter too (just saw a production of his "50 Million Frenchmen" this weekend). I like musicals, really, just never heard anyone but my friend Jake quote what I now know is, "Summertime." ...until I started blogging. Live and learn.

Special thanks to Robert Earnest who sent me an mp3 of Lena Horne's version, which now occupies an honored spot in my iTunes library... don't get on his case, it's a Fair Use as "educational material."

Now... ask me anything about rock 'n' roll!

Remembering The World Trade Center

Tonight's "Tribute In Light"

This Day In History, 2001

Diary: September 10th

I guess you have to be a dyed-in-the-wool New Yorker to experience a little depression on September 10th. Tomorrow, September 11th, even five years after the terrorist attacks on NYC, will be extremely depressing for me.

Generally speaking, I don't hold grudges. If I get angry about something I get over it quickly and put it behind me. As for September 11, 2001: I'm still angry .....and I won't forget!

Home At Last!

Well, all moved in! Actually been here for a week but I took the time to set-up properly before getting sidetracked by the Internet... just been keeping a low profile except for minimal personal correspondence.

Actually, the packing was the most difficult part. I got rid of a lot of stuff I had lying around, like color lab labels. Haven't used any of those since going digital a year ago. Bunch of other stuff too, trying to put my pack-rat days behind me.

The move itself was actually pretty smooth. Jeff Beckett hooked me up with his friend Aquil who arrived with his crew and two trucks last Saturday morning at 8:15 AM. They had me out of the old place and completely in the new place by 9:30 AM... yep, an hour and fifteen minutes. I was stunned.

Murphy's Law be damned... nothing broken, nothing lost or left in the trucks. Out and in, clean, in under two hours. Unbelievable!!!

Got the desks set-up, the computer stuff unpacked, hooked-up to my new DSL line without so much as a hiccup. Fax machine’s working too. I’m so amazed it was all without incident, the potential was certainly there.

Tomorrow’s Labor Day. Gonna spend it with my children. Tuesday it’s back to work. I’ll post a couple of pictures of the new space in the next couple of days.

Hope you all had a great summer!