Thousands of furious Shutterstock contributors have banded together under the umbrella of the Stock Coalition, disabling their portfolios and removing an estimated 8 million images from the microstock agency archive. The official campaign, Shutterstock Deactivation Day (D-Day), began on June 15 and will run until the end of the month to fight the contributor pay cut rolled out on June 1.
Despite weeks of continuous backlash from contributors, Shutterstock remains unmoved. The goal of D-Day is to negatively impact Shutterstock’s Q2 financial results. Recorded on June 30, a key metric measuring Shutterstock’s quarterly performance is its contributor and archive growth.
Shutterstock D-Day is an effort by the newly formed Stock Coalition, which has over 4000 members united against Shutterstock’s controversial contributor pay cut.
‘Many other Shutterstock contributors have (already) deactivated or deleted their portfolios entirely,’ Dimitar Gorgev, Stock Coalition spokesperson and Macedonian Shutterstock contributor, told Inside Imaging. ‘Before now there wasn’t an organisation joining contributors to coordinate their efforts – contributors were doing this on their own.
‘Many of those deactivating or deleting their portfolios are high-quality stock producers. Those frustrated by low royalty rates are often those who rightfully value their work. It’s critical that agencies are able to keep these high-quality producers on their books, because it’s their content the buyers are looking for. Buyers will be left with limited choice and will have to look elsewhere for the top-notch, quality material they used to find at Shutterstock.’
On May 26, Shutterstock announced a new contributor earning schedule, effective from June 1, which determines contributor payments based on the volume of images licensed each year. Contributors across the board reported record low payments of US$0.10, a drop compared with the typical US$0.25-0.38 fee previously earned.
Shutterstock has under-performed on the New York Stock Exchange, and while the pay cut is an attempt to improve its financials, the company’s internal operating expenses are growing at a much larger rate than the growth of contributor payments. Read about Shutterstock’s financials here. Over the last 52 weeks, Shutterstock shares are down by almost 20 percent, while the S&P 500 is down just -0.42 percent.
‘Contributors have dedicated so much time and energy into creating quality content that helped build Shutterstock to what it is and for them to make this move feels like a major betrayal,’ Dimitar said.
Shutterstock is waiting for all of this to blow over. And while the backlash was likely expected, it’s doubtful Shutterstock’s new management, including recently-appointed CEO Stan Pavlovsky, anticipated contributors would form a lobby group.
The Stock Coalition has a website, press release, and Facebook group with over 4000 members. In the Facebook group there are hundreds of posts by contributors flagging the deactivation of their accounts.
The D-Day campaign progress has been measured by the size of the Shutterstock archive through an empty word search. On June 1, contributor Merab Shonia recorded there were 326 million available files – photos, vectors, illustrations and videos. On June 18, he recorded Shutterstock’s archive had dropped to 318 million. That’s at least 8 million deactivated files, and doesn’t fit with Shutterstock’s claim to generate over 1.8 million new contributions per week.
‘Sometimes stock agencies get disconnected from the reality that they have no product. They forget there are people that supply the content, and if they make it unsustainable for contributors then the agency loses too. Unfortunately they don’t feel the pain until after the contributors have felt it and left. We cannot survive under these conditions with them.’
Shutterstock is one of the largest microstock agencies in the world, however Dimitar recalls back when the agency was in its infancy and the market was dominated by iStock. ‘They (iStock) went from being the most cherished agency to an afterthought’. Its downfall is attributed to pay cuts that devalued contributors’ work.
‘Contributors are not naive, they will move their content to the agency which treats them fairly. It just takes time to do this. In time there will not be any serious contributors left,’ he said
Despite Shutterstock’s stoic, steely-eyed stance, there are some signs the widespread deactivation is having an effect. Stock Coalition members are reporting attempts by Shutterstock to lure them back with a one-off boosted royalty rate.
Big fish in a big pond
Many photographers exclusively contributed to Shutterstock due to the decent pay and reliable numbers of sales. In return, Shutterstock receives exclusive premium content, which keeps customers returning and retains its market share.
Dimitar said many exclusive contributors are now taking their archives to competing agencies, such as Dreamstime, Adobe Stock, Pond5, 123RF, and others.
Dreamstime spokesperson, Carmen Pietraru, informs Inside Imaging the agency is welcoming ‘more contributors than any other agency. We have had the largest stock photo community for many years now. Moreover, we’ve had a steady growth since January. If we are to compare the numbers with the previous years, (there was a) 43 percent increase in January going up to 68 percent in May.’
Carmen attributes Dreamstime’s recent success to no singular reason, however the recent 10 percent boost to the royalty rate for contributors likely assisted.
The Stock Coalition is communicating with stock agencies to explore the possibilities of future partnerships. Beyond Shutterstock, the long-term goal is to ‘make it beneficial for an agency to partner with the coalition’:
‘In the end, we probably need to thank Shutterstock as they have provided the spark the contributors needed to unite and establish regulation so that the business can continue to be sustainable. For the first time, we have come together to form a coalition that will represent our best interests in the industry. In our group we have people from all over the world and more are coming in every day. We are receiving growing support from the community and we are very thankful for that.
We are not ignorant of the current status of the industry and we try our best to not be arrogant or overly idealistic. We understand that the market has become too saturated and that agencies strive to survive by cutting costs.
That said, we want to help agencies stop the race to the bottom as this cuts everyone too thin. Certainly, there is very little to be cut on the contributor’s side of most agency remuneration agreements. This is our most basic demand in order to start negotiating with an agency. We will still keep an open door for Shutterstock to reverse their bad decisions, but that door closes further every day.’
Over 10,000 people have signed a petition on Change.org calling on Shutterstock to reverse its decision.
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