We're discussing how to work out the start-up costs for a footage library to start selling video online. In our previous post we discussed the cost of content acquisition and video archive management costs. So check out How much do you need to start a video library - Part 1 if you haven't yet done so :) Today we're talking about acquiring a footage platform for your library.
Cost of software platform
Jim Pickerell, the highly respected commentator on the image & footage industries pointed out recently the turmoil at the top of the business; generally speaking content owners using Getty and other large distributors are experiencing falling sales. And when you only get 30% or less from each sale that’s serious. No wonder content owners and video producers are publishing less fresh content to the “sheds”
Anecdotal evidence suggests that smaller, specialist companies who understand and run consistent online and offline marketing campaigns are sidestepping this fall; so it’s in your interest to consider acquiring & marketing your own site.
Of the four usual routes to acquire a sales platform market – new in-house build, outright purchase of an existing system, perpetual licence of an existing system or a Software as a Service (SAAS) platform – a perpetual licence is the clear financial winner over a 3 to 5 year term.
|Software Licence||First Year Cost||Hosting 1TB per year||Support||3 year cost||5 year cost|
||$ 25,000.00||$ 3,240.00
||$ 40,120.00||$ 50,200.00|
||$ 13,500.00||$ 3,240.00
||$ 55,620.00||$ 92,700.00|
|Outright Purchase||$ 50,000.00
||$ 62,000.00||$ 70,000.00|
|Complete Build||$ 100,000.00
||$ 112,000.00||$ 120,000.00|
Critics point out that a SAAS option is upgraded overtime. However technology changes fundamentally every three to five years and a SAAS programme would be hopelessly out of date after 10 years even with upgrades. The best option, clearly, is to buy a brand new platform based on a perpetual licence every five years.
Our next post will be about footage library marketing. So don't miss it next week. Have a great week!