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Usage Fee Question

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dorne pentesUsage Fee Question
by on Mar 5, 2009 at 2:53:55 am

Hey, folks. Dorne here with a question about usage fees. I've been in business for over seven years, and this question comes up over and over. I've never addressed until now--when times are tight. The question regards usage fees, like the ones photographers charge. As you may know, photographers generally charge usage fees for their work--if they pull the trigger on the shot,they own it, and in addition to their day rate for shooting it also charge a fee for the client to use it. The fee is based on how many instances the shot will be used, in how many markets and mediums.

I've never known of directors or production companies charging such fees, but I've never really asked or investigated, either. Do you charge usage fees for commercials? Marketing films? If so, what criteria do you apply? Any other advice or counsel? Thanks, Dorne

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Steve WargoRe: Usage Fee Question
by on Mar 5, 2009 at 5:46:32 am

I think that if you want to put your self out of business, you should implement that strategy tomorrow.

By the way, if you are in a conversation with someone else and you use the line above, you will owe me a "usage fee".

Seriously though, we have discussed the "ownership" thing many times and it comes down to this when you're shooting for a client. If it's not "a contract work for hire", you would own the copyright (completely useless) because they own the right to use it in perpetuity. This came from the largest IP law firm in Arizona.

Steve Wargo
Tempe, Arizona
It's a dry heat!

Sony HDCAM F-900 & HDW-2000/1 deck
5 Final Cut (not quite PRO) systems
Sony HVR-M25 HDV deck
2-Sony EX-1 HD .

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Dorne PentesRe: Usage Fee Question
by on Mar 5, 2009 at 2:15:22 pm

Hey, Steve-thanks for your response. Yes, I obviously could have done this long ago,and wrecked my business in the process, which is why I haven't. But the subject came up in discussions with a Professional Photographer again yesterday, and he seemed genuinely perplexed as to why we didn't do it. And on the face of it, why shouldn't we charge usage fees? Photographers have done it for years, so why is it different for commercial directors? I realize this is merely an academic question, but even so....

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Franklin McMahonRe: Usage Fee Question
by on Mar 5, 2009 at 2:22:40 pm

When I started a photography division of my company this was a big issue. Years ago I would have separate rates for specific usages. Eventually I just charged higher rates and baked the usage into the cost. If clients had concerns with the high price I would allow them to throttle back to a limited usage arrangement, which most did not go for.

As for video, you may be asking about turning over the raw footage so a client can edit future productions...not sure.

Bottom line, if the client can use items to do something new from your work instead of potentially hiring you for this repurposed project, then you need to charge a premium to that client for that luxury. To me it's that simple.



Franklin McMahon / Host PODCAST

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dorne pentesRe: Usage Fee Question
by on Mar 5, 2009 at 2:59:10 pm

Hey, Frank- thanks for your post. Very helpful advice and insight. Thank You!

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