Pricing & Negotiating: Day Rate vs. Space
Monday May 10th, 2010
by Bill Cramer
Many magazines have contracts with rates and terms that they offer to photographers (which are generally negotiable). Others don’t have their own contracts and instead work on a case-by-case basis with individual photographers. For those situations, it’s good for photographers to have a contract template on hand. We tend to structure our editorial fees based on a day rate against space. It’s an elegant solution to the problem of how to scale editorial fees, and it’s widely used by many national magazines, but some people find it hard to get their head around at first.
Pricing for editorial photography tends to be different from commercial photography for a couple of reasons. When a company decides to produce an ad or brochure, they already know what they need (in terms of photo display and usage) before the photographer is brought in. So it’s mostly a matter of the photographer coming up with a price and terms to fit those unique specifications. Magazines, on the other hand, need to work much more spontaneously. Editorial opportunities often come up on very short notice, and they also tend to morph from the time of the assignment to the time of publication. When an editor and art director send a writer and photographer out on a project, they never know what they’re going to come back with. And the play in the magazine is going to depend largely on how interesting and relevant that result turns out to be, compared to other stories that they’ve got cooking.
So photographers and magazines are best served by a contract that can be put in place for a couple years at a time (which allows for last-minute projects) and is scaleable (to account for variations in the amount of time required, expenses and the number and size of the pictures used). After all, it’s reasonable to charge less for a project that takes a day to complete vs. one that takes a month. It’s reasonable to charge less for a project that you can do alone in your back yard with a fill card than one that you have to take a crew of 7 and a dozen cases of rental equipment to Tunisia for. And it’s reasonable to charge less for a 1/4-page photo inside the magazine than a cover and 10 pages in the well.
The day rate vs. space structure takes all of these variables into account. The day rate is a minimum guarantee that compensates the photographer for his time on the project. It tends to be fairly modest, to accommodate small projects that won’t have a big presence in the magazine. The space rate comes into effect only when the magazine ends up using multiple or large pictures. The expenses are what they are. The structure nicely scales from small assignments that the publication can have done inexpensively, while incentivizing the photographer to produce a lot of great pictures. And it minimizes the need to renegotiate after the fact, when the final piece in the magazine is different than imagined.
And here’s an explanation of each paragraph:
PHOTOGRAPHER NAME / MAGAZINE NAME
We call it a licensing agreement, because at the heart of it, it’s an agreement that allows the client to use the photographer’s images, and it specifies the terms of that use.
1) AGREEMENT - This contract between PHOTOGRAPHER NAME, (hereafter “Photographer”) and MAGAZINE NAME, (hereafter “Client”), governs assignments executed by the Photographer for the Client between 5/9/10 – 5/8/12, and constitutes the entire agreement between the parties concerning those assignments.
It’s good to have a contract like this apply to assignments during a specific time period, which might be 1-5 years. Many of the terms specified in the contract will need to change over time, for lots of reasons. Forcing a new contract after this one expires minimizes the ambiguity caused by multiple contracts that all last “forever”. And while you will effectively be creating a series of contracts into the future with a particular client, it’s important to understand that each assignment will ALWAYS AND FOREVER be governed by the contract in place at the time that assignment was produced. So it will be important to keep copies of all of your old contracts.
2) COMPENSATION/LICENSING – Client will pay the Photographer the following creative fees plus expenses, for first domestic editorial print use and concurrent editorial web use of the photographs from a particular assignment. The Photographer will initially bill for her time and expenses. Then when the photographs are published she will bill for the balance of the Space her photos occupy in the magazine, to the extent that it exceeds the Day Rate.
To help minimize the bookkeeping for the photographer and the magazine, we normally wait and see if the pictures get published quickly. Then we can include any applicable space in the initial invoice. If a month goes by and the pictures still haven’t been published, we’ll send out an invoice for the day rate and expenses. Then when the magazine comes out we’ll bill for any additional space.
- DAY RATE – 750.00 per shoot day, for up to 9 consecutive hours including travel time. The Day Rate includes use of up to 750.00 worth of space in the magazine. Travel and production time, to the extent that it makes the total time on an assignment exceed 9 hours, will be prorated.
The day rate is intended to cover the photographer’s time to execute an assignment, regardless of how it ends up getting used. It serves as a kill fee in cases when the magazine chooses not to publish the photographs (for reasons beyond the photographer’s control).
- SPACE RATE – 150.00/picture up to 1/8 page, 300.00/picture up to 1/4 page, 450.00/picture up to 1/2 page, 600.00/picture up to 3/4 page, 750.00/picture up to full page, 1500.00 for full cover.
The space rate comes into effect when the magazine uses large or multiple pictures. We have structured it so that one day rate entitles the magazine to use the pictures up to one page without additional fee. Beyond that, the space rate takes over. In effect, the fee becomes the greater of the day rate or the space rate.
- NORMAL EXPENSES – include assistants (250.00/day), digital captures delivered by web gallery for editing (300.00/shoot day), lighting kit (300.00/day), mileage (billed at current IRS rate), parking, tolls, meals, reproduction file preparation (25.00 each including minor retouching), and file upload (25.00 for any number of files).
The web gallery fee covers the time, equipment and software required to organize, edit and process the files and then run the gallery. For editorial clients, we normally include the cost of digital cameras in this fee. Some photographers and magazines like to lump the fees for the web gallery, file processing and file upload into one digital fee. We like to separate them so that clients who just need one file just pay for one file. And if a client needs 20 files, the photographer gets fair compensation for the time required to properly process them.
- SPECIAL EXPENSES – may include, with prior approval, additional equipment rental, stylists, props, wardrobe, studio rental, location fees, permits, special retouching (150.00/hour).
On shoots that require significant time arranging, and often floating the cost of, a lot of production support, it’s reasonable to either charge a mark-up on those items and/or charge for the actual production time. That production time, which we normally charge out at the same rate as the photographer’s day rate, does not typically get subtracted off of the photographer’s space rate, if any. It’s not unreasonable for a photographer to have stylists and models bill the magazine directly, or otherwise get an advance for those expenses.
3) ESTIMATES – Photographer will provide the Client with a cost estimate upon request. The fees and expenses estimated by the Photographer are for the original job description as presented by the Client. Subsequent changes or actual job conditions may result in additional charges.
It’s important for the photographer to be respectful that the client doesn’t find any major surprises when the bill comes. And by the same token, the client needs to understand that the photographer can not know ahead of time every possible expense. Good communication sooner is the best way to avoid awkward situations later.
4) PAYMENT – Client will make payment within 30 days of invoice. Late payments will be billed $20.00/month handling fee and 1.5%/month interest. Please make checks payable to PHOTOGRAPHER NAME.
Some magazines will want to pay upon publication, but this is an unreasonable policy. A photographer has expenses (personal, business, variable and fixed) that can’t wait for the publication date of a magazine. It’s reasonable for a client to pay photographers in a timely manner. And by the same token, photographers must take responsibility for the sub-contractors they hire, and pay them in a timely manner as well – whether they have been paid by their client or not.
5) COPYRIGHT – All Photographs are copyright by the Photographer. Grant of any reproduction rights to the Client is conditioned upon receipt of payment in full. All rights not expressly granted to the Client shall be reserved by the Photographer.
A photographer will have much greater leverage when pursuing late payment if they have registered the copyright to the pictures. Rather than suing for a couple thousand dollars for non-payment, if a client uses the pictures and then fails to pay, the photographer can sue for many multiples of that for copyright infringement instead.
6) FOREIGN LANGUAGE & FOREIGN EDITION USE – If the Client wishes to use any of the Photographer’s photos in a foreign language edition of the publication or in an English language edition outside of the United States, Client shall seek prior permission from Photographer and pay an additional fee to be agreed upon.
Most publications are published for a particular country and/or language. Magazines will often have licensing agreements with third parties to publish foreign editions. The shoot fee should be commensurate with this additional use.
7) REPRINT USE - If the Client wishes to sell, distribute, or give permission to sell or distribute article reprints at any time, for any purpose, to anyone, the Client shall seek permission from the Photographer in advance and pay an additional fee to be agreed upon.
Many photographers don’t realize that article reprints are often worth a lot more than the original shoot. Frequently the subjects of flattering articles (especially businesses) will want to have that article repackaged so they can use it to promote themselves with. While the assignment might pay editorial rates, article reprints typically fall in the realm of advertising, and as such, they’re worth a lot more.
8) PROMOTIONAL USE – Without additional fee, the Client may use the Photographs to advertise or promote only the issue of the publication in which they appear, provided the Photographs are shown in the original context of that publication, and provided the Client secures the permission of any recognizable people and properties in the Photographs. If the Client wishes to use the photographs for any promotion at a later date, or out of context at any time, the Client will seek permission from the Photographer in advance and pay an additional licensing fee to be agreed upon.
It’s reasonable that a photographer would want to support a magazine’s efforts to promote the issue in which their work appears. But if a magazine wants to use a photographer’s work in a prominent way to promote their overall brand, it’s reasonable to pay an additional fee for that because, again, editorial use plus advertising use is worth more than editorial use alone.
9) REUSE – If the Client wishes to reuse any Photographs generated from a previous assignment (which was originally shot for the Client), the Client shall notify the Photographer of that use and pay the above Space Rate for that use. If the Client wishes to use any Photograph originally generated for another publication, the Client will request permission from the Photographer and pay a fee to be agreed upon.
It’s reasonable for a client to reuse pictures at a reasonable, predictable rate. But in cases where they didn’t have a role in generating the pictures, it’s reasonable for the photographer to offer the pictures up at a rate that reflects the actual value of the photographs, which could be much different than the contract rate.
10) THIRD PARTY USE – Client will not assign or transfer the rights granted herein, or authorize use of Photographs (whether in the context of the Magazine or not) to any third party for any reason.
In the absence of an agreement to the contrary, it’s reasonable for clients to pass along third party inquiries directly to the photographer.
11) OTHER USE – If the Client wishes to make any use of the Photographs not covered by this Agreement, Client shall seek permission from Photographer in advance, and pay an additional fee to be agreed upon.
This paragraph covers anything we haven’t otherwise thought of.
12) CANCELLATIONS, POSTPONEMENTS – In the event of a cancellation or postponement of a shoot by the Client or subject, Client shall pay all expenses incurred by the Photographer up to the time of cancellation, plus a fee to be agreed upon. If a shoot is canceled within 24 hours of departure for the shoot, the Client shall also pay 50% of the anticipated photographic fee and 100% of the anticipated fees of any subcontractors booked for the job. The same policy holds for cancellations due to bad weather.
Cancellation policies should be exercised with restraint and should be flexible depending on the exact situation and client/photographer relationship. If the subject postpones a shoot and we can reschedule it, I normally wouldn’t charge a cancellation fee (though we would in some cases bill a cancellation fee for the subs).
13) CLIENT REPRESENTATION – The Client is responsible for the presence of an authorized representative at the shoot to approve the Photographer’s interpretation of the assignment. If a Client representative is not present, the Photographer’s interpretation shall be deemed acceptable.
Photography is inherently a creative process, and subject to everyone’s individual taste. It’s reasonable for the photographer to reshoot an assignment at their own expense if the pictures are all out of focus, or poorly lit or exposed, or the photographer shot the wrong subject. It is not reasonable for the client to expect the photographer to cover the cost of a reshoot simply because they don’t like the pictures.
14) EXCLUSIVITY - Assignment Photographs will be exclusive to the Client for a period of thirty days from publication or six months from receipt, whichever is less. Unless otherwise agreed upon, use of stock Photographs shall not be considered exclusive.
A magazine should expect a reasonable amount of time to have the pictures exclusively (at least the period of the publication – weekly, monthly, quarterly). But given the modest fees that come with editorial assignments, magazines should understand that photographers depend on other sales of that work to make it profitable to do it in the first place.
15) INDEMNIFICATION – Client hereby indemnifies and holds Photographer harmless against any and all liabilities, claims, and expenses, including reasonable attorney’s fees, arising from Client’s use of Photographer’s Work. The Photographer hereby indemnifies and holds Client harmless against any and all liabilities, claims, and expenses, including reasonable attorney’s fees, arising from the Photographer’s misrepresentation of the Photographs.
It’s reasonable for both parties to protect each other in cases where they do something that jeopardizes the other party.
16) AUTHORSHIP CREDIT – A credit in the name of the Photographer shall accompany the Photographs, on the same page, when they are reproduced, except for the case of a cover photo, where the credit may appear on the table of contents page, or in the case of multiple photos, where the credit may appear once at the beginning of the spread. Any credit omission will be rectified by the Client including a correction in the following issue, or by the Client paying the Photographer double the otherwise agreed upon fee.
Again, with editorial fees as modest as they are, photographers count on the publicity of a photo credit to help make it worth while.
17) TEAR SHEETS - Client will provide Photographer with a copy (print or electronic) of any publication, in its entirety, her Photographs appear in.
Tear sheets are valuable for photographers’ portfolios and also to calculate Space when applicable.
18) INDEPENDENT CONTRACTOR STATUS - Photographer acknowledges that she is an independent contractor, and is responsible for paying the appropriate taxes and insurance as such.
To limit their liability in many ways, clients will want it to be clear that the photographer is an independent contractor rather than an employee.
19) TURN AROUND TIME – Normal schedule for web photo gallery or final file preparation is 48 hours. There will be an additional 50% charge for 24 hour service, and an additional 100% charge for same day service.
Photographers need to communicate clearly with clients about when they can expect to see their pictures. For some photographer/client relationships, “as soon as you can” is appropriate as long as there is give and take on both sides. For others, it’s best to set more concrete boundaries.
Photographers will need to modify this contract to be appropriate for different clients. I have arbitrarily chosen 750.00/day vs. 750.00/page as an example. For some magazines higher rates are going to be appropriate. Others will need to be lower. Some clients will want more extensive foreign use, exclusivity, article reprints, or promotional use. And that’s all fine as long as the fee is commensurate with that use.
For more information on Wonderful Machine’s pricing and negotiating consulting services, please contact Ben Weldon at email@example.com or 610.260.0200.