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December, 2014

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The Pathetic and Paltry Time Magazine Assignment Rate & Rights Grabs

What's good for the goose is clearly not good for the gander. “Purchase” is not “license.” According to Time's own website (here) ” We license Time Inc.’s peerless content, brands and products to partners in new businesses and emerging markets.”

DEFINITION: Peerless
adjective
1. having no equal; matchless; unrivaled.

Synonyms:
unmatched, unequaled; unique, unsurpassed.

* source: Peerless, at Dictionary.com

Yet, that “peerless content” which Time wants contributors to produce is not something that they are purchasing like a computer or plane ticket. The software they pay a fee to license from Microsoft and Adobe, while seemingly purchased, is not, it's licensed. They may have “purchased” a physical CD of the software, but they do not have ownership of the software to use across multiple platforms unless they obtain a broader license to the work, and pay an appropriate additional fee.

As reported in PDN Pulse (here), Karen Myers, who is Time's UK’s Director of Corporate Communications, said “…Contributors need to bear in mind that commercial realities dictate that we will be using the content that we purchase in many different ways…” yet Time's website Terms & Conditions (here) make it abundantly clear (regarding the intellectual property on their website) they “own, solely and exclusively, all rights, title and interest in and to the Web Site, all the content (including, for example, audio, photographs, illustrations, graphics, other visuals, video, copy, text, software, titles, Shockwave files, etc.).

Time UK has been, and it will remain, licensing content from contributors. They will not be “purchasing” ownership of it any more than I can take that Norman Rockwell I want to buy and (once I do) make posters and lithographs off of it. Yet that is what Time UK (and as has been suggested by others, this is a trial balloon for US contracts) wants to do.

This smacks of what occurred in the late 1990's, when Time unceremoniously foisted upon contractors, contributors, and freelancers, a new egregious contract. Many of the seasoned team of photographers, stood their ground and refused to sign, only to be replaced by those who looked up to them as standard bearers – “peerless” photographers, to coin Time's characterization. The “new team” stepped in to fill the void, crumbling what ground those photographers were standing on. You can, no doubt, see those who were undercut by the newcomers sitting back and saying “what goes around comes around…” and not missing a wink of sleep as the downward spiral continues.

(Continued after the Jump)

How Far Down Is That Spiral Going?

In 1980, the Time Magazine contract indicated a rate of $350, and in about 1990 it was $450. In 2000 and on through to about 2011, it's $500. It's about $550 in 2014.

In 1980, $350 was worth, well, let's set that as the baseline, and say $350 is worth $350.

Would the 1980 photographers taken an assignment for the “Peerless” Time Magazine for $191? No, they would not.

Here's how Time Inc's (NYSE: TIME) assignment rates have worked, throughout the years.

First is the middle line, which tracks the rate as paid. The top line is the rate had it kept up with inflation alone. The bottom line is the buying power of that rate, over time.

How did we arrive at these numbers? The US Department of Labor has a calculator (here) that allows you to compare buying power, over time. It's a fact that essentially everything increases in cost over time. That loaf of bread in 1980 was about $0.50 and now it's $1.50. Gas? Of course – more expensive too. As such, your ability to buy something has been reduced, over time, unless you get a “cost of living adjustment” in your income stream.

If Time were paying an assignment rate of $1,000.00 it would have just kept up with inflation relative to their previous $350 assignment rate from 1980.

Has their per-page ad rate gone up? Yes.

Have their employees received cost-of-living salary increases? Yes.

Where is the equity in paying those that produce that peerless content that brings in readers? Absent.

Know that if you're a photographer now that accepted the $500 back 10-15 years or so ago (when it should have been about $750), you were undermining the photographers who tried to take a stand for better pay then. Now, when you try to take a stand, make no mistake about it, there will be photographers who will fill the void, and you can join the ranks of past Time Magazine contributors saying “what goes around, comes around – trust me, I have experienced the financial pain that proves it.”

You either stand together, or fail separately. Your choice.

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Related:
The REAL 'New Frugality'-Time Style, 7/25/09


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Dumb Hookers and Photographers

How much money are you losing when you're not paid when the services are rendered, or even on time?

There's an old saying:

“even the dumbest hooker knows they get paid up-front.”

Setting aside the disparagement some of the purveyors of the oldest profession in the world, the sentiment of being paid up-front is obviously a time-honed position.

Consider this – A common credit card has a 17% interest rate on charges.

Why Interest?
Q: Why do people charge an interest rate?

A: It's “the cost of money.”

The concept is – if a financial institution loans you money to buy a house, they're not able to use that same money to invest in stocks or other investments that will, over time, increase in value.

Therefore, when a bank loans you $300,000 with 30 years to pay it back at 5% interest, and with you paying a monthly mortgage of $1,654, at the end of 30 years, they will have earned $229,910 in interest and you will have paid a total of $595,639 for that house.

If you were to buy $10,000 in photo equipment, and not pay it off in a year, you would have to pay $1,838.92 in interest if the interest was “compounded monthly” as compared to $1,852.58 if the interest was “compounded daily.” As such, the difference between “compounded monthly” and “compounded daily” is $13.66. How does that work? What happens is that “compounded daily” means that on day 1 you owe $10,000.00. At the end of day 1, approximately $4.66 in interest is accrued, and so on day 2 you owe $10,004.66. Compounded monthly, you wouldn't owe any interest until the end of the month, but then you would owe $141.67 in interest.

(Continued after the Jump)

Now, consider the value of your own money – that which you earned. If you earned $5,000 for an assignment, and you get paid that money up front, you could, in theory, immediately invest it in one of the safer investments – bonds – with a 4% return. So, at the end of the year, it would have $5,204 in value. Thus, it should be painfully obvious that if that client waited a year to pay you, you would have lost the ability to make that investment, thus, losing $204. Simple math tells you that if they waited 6 months, you'd have lost $102, and in 90 days, you'd have lost $51.

So, when that client tells you “we pay in 90 days” what they're saying to you is “I know your bill is $5,000, but we're going to pay you in 90 days, and you'll have lost $51 in earning value during that time, so you'll only have earned $4,949.00.”

Consider that most clients and vendors should be on a 30 day pay cycle, that same $5,000 has a per-month value of $17.00. That's like a client disavowing a parking garage expense or a two-person fast food meal, “just because…”

Here's the rub – when you incur a $5,000 expense your credit card company wants it paid back in 30 days, or you pay interest. $70.83 at 17%. Where's your $70.83 when a client doesn't pay you in 30 days?

So, on that $1,000 assignment, where's your $14.17 when that client doesn't pay in 30 days?

It compounds. If you're a photographer that does three $500 a week assignments, that's a gross revenue of $78,000. That's 156 assignments a year. The difference between getting paid in 30 days versus in 60 days is, at $7.08 an assignment, an $1,104.48 loss in the power of your money, or doing just over two of those assignments for free.

There are many “standard” payment cycles, all built into your business model and what works for you.

Most wedding photographers take a deposit when the contract is signed and the full amount a week before the wedding, or upon delivery of the proofs (I'd recommend a week before the wedding.)

Many commercial photographers expect a deposit when the contract is signed (so they can start booking air/hotels and incurring other expenses on the clients' behalf) and the balance due on receipt of final images (but before first usage of said images).

Other photographers are on a 14-day, 21-day, or 30-day schedule. Some require clients to pay on the spot with credit cards.

In the end, it's important to recognize the value of your money, and get it as soon as possible.


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