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Article Story:
ROYALTY FREE LICENSING: LEGAL ISSUES
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Date:
14.01.2003
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Royalty free licensing is a new commercial model. The
model is attractive to customers partly because of its
simplicity. However, like all new models there are problems
and ambiguities associated with it. In some cases the
simplicity is more apparent than real.
Traditional rights protected licensing involves licensing images
for specific uses for a fee based on the type of use, the duration
of the licence and the territory in which publication will take
place. The fee may be fixed in advance or negotiable.
'Rights protected' is something of a misnomer: the licence will in
some cases be exclusive to the customer, but very often it
isn't.
Royalty free licensing involves buying licensing images on a
non-exclusive basis that can be used for practically any purpose
any number of times anywhere in the world and at any time.
Royalty free images are typically supplied on CD-Rom or over the
internet, but the means of delivery is irrelevant. Dover
Books has for many years been supplying what are in essence royalty
free images in book form.
From the customer's point of view a royalty free licence appears
simple: you buy a royalty free image, it's yours to do what you
like with.
In some ways though, royalty free licensing is more complicated
than rights protected licensing. Instead of paying for a
specific licensed use you are paying for a very wide range of uses,
but there are limits to what you can do with royalty free images
and those limits are not always well defined.
You need to look at the small print in the licence
agreement.
For example, if you are going to store an image on a company's
network, the basic licence will probably restrict access to 10 or
12 users. To allow more people to have access to the image
you will need to extend the licence in the same way as you would
with other types of software.
There will also be restrictions on how the images can be
published. A royalty free licence will not always include
merchandising uses such as calendars and postcards. You will
not be able to use the image in ways which compete with the
supplier of the image, for example by putting it on a web site and
making it available for licensing by other people. And an
image bought by one company in a group may or may not be available
for use by other companies in the group.
Legal problems also arise in practice with the subject
matter of royalty free images.
There is a perennial problem with building releases.
Modern buildings often attract copyright protection, if they can be
considered 'original' artistic works. This is rarely a
problem in the UK and in other countries where photographing a
building does not infringe the copyright in the building. But
in some continental countries the position is very different.
Collecting societies make demands for substantial infringement
damages if an image of a protected building is published without
payment of a licence fee.
There is no official register of copyright protected buildings,
although unofficial lists of problem buildings are in
circulation. Even more with royalty free than with rights
protected licensing, the customer will often assume that all rights
in photographic content have been cleared. In practice this
may not be the case. The small print in the royalty free
licence may seek to put the legal onus for clearing such rights
onto the customer, but the customer will usually expect the
photolibrary to sort out the problem. Customers buying
royalty free images of buildings do not expect to have to pay
royalties to the architect.
Similar problems arise with model releases. Royalty free
images are often used for sensitive issues because customers
imagine that the images have been model released for absolutely
anything. In practice the position is not always that
simple. A model release form, unless it is very well drafted,
may be vulnerable to legal attack if a model finds himself or
herself associated with some unsavoury product or campaign.
And there have been cases where libraries have licensed images from
photographers who have simply lied about the existence of model
releases. Such issues can create serious problems both for
the customer and for the photo library.
Worldwide royalty free revenue has recently been estimated at
around $300 million. It is a small but growing portion of the
total image market. The commercial model has yet to be fully
defined and there are still widely held misconceptions amongst
customers. The main message to anyone involved on the
receiving end of royalty free licensing is read the small
print!
Charlie Swan
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