Is Flickr Guilty of ‘Freemium Extortion’?

Clock
The clock is ticking for non-subscribing users of Flickr…

If you hit the Flickr Help Forum, you’ll currently find a thread of well over 8,000 posts relating to what some are describing as a blackmail scheme. Many of the comments do defend Flickr, although the defensive comments mainly come from a handful of supporters who post intensively. Whether that passes as credible support is open to debate, but there’s no doubt that a drastic policy change, announced by Flickr at the beginning of last November, has upset a lot of people. Have we really witnessed an extortion plot?…

WHAT HAPPENED AT FLICKR?

In May 2013, the then Flickr owners Yahoo scrapped a 300MB per month image upload limit for users with free accounts, and set an astronomical new maximum upload capacity of 1TB. Users with free accounts were told, at this point, that the new storage capacity was free to the photographer, and funded by the advertiser. No buts, no untils; that’s what they were told.

In spring 2018, SmugMug bought Flickr, expressing an intention to continue running the platform without significant change.

In November 2018, SmugMug U-turned on their previous assertion, warning that from January 2019, free Flickr accounts would have their maximum capacity limited to 1,000 photos in total, and threatening to delete all excess images after 5th February 2019.

In summary, users with free Flickr accounts were encouraged to upload a vast quantity of images on the basis that they would not have to pay, and then, after many had made major commitments to Flickr, they were told their work would be deleted if they did not pay. There isn’t even a way to put a positive spin on it.

IS THIS EXTORTION?

Extortion is defined as: the practice of obtaining something – especially money – by force or through the use of threat.

And there’s no doubt that Flickr has made a threat to a section of its users. The threat to delete those users’ content is a very significant one too, because many users had built a dependency on the site, such that they had no other realistic option but to pay the ‘ransom’ of a subscription charge. Since those users were previously assured by Flickr that the service was free to the photographer, and funded by the advertiser, it’s fair to conclude that they made their commitments on that basis.

PRECEDENT

The action Flickr has taken is not unprecedented. Other photo-sharing sites have built their profile by offering photographers a lot of free benefits, and then, once photographers were essentially ‘locked in’ to using the service, withdrawn the free plan and deleted non-subscribers’ content. The most famous case was that of ImageShack, which, having virally spread its name with the offer of free hotlinking, ultimately redirected non-subscribers’ hotlinks to ImageShack ads, leaving third-party sites strewn with unsightly spam.

It’s hard to appreciate the scale of the problem until you’ve seen just how much labour is required to clean up the mess once a photo site decides to give its users this kind of ultimatum.

Bear in mind also that we’re not talking about sites that have always prohibited hotlinking. We’re talking about sites that specifically offer free hotlinking to bait a large userbase and publicise their brand, and then not only retract the offer, but abuse the situation their offer has created, to place ads for their own website on other domains. Hotlinking is one significant component in the dependency that photo-sharing sites engender in their users. Others include the social aspects, potential loss of an audience that took years to build, etc.

DEPENDENCY

I only have a total of 142 of my images on Flickr, and I only occasionally hotlinked from my blogs to my Flickr photos. But still, over the five and a half year period since the 1TB of free storage was announced, my blogs had amassed a modest volume of hotlinks to my Flickr account. Since I was nowhere near Flickr’s new 1,000 photo limit, neither my Flickr uploads nor my blogs were in imminent danger. However, in my view it would be insane to trust a site which has shown the level of policy instability that Flickr has now shown, so I decided to eliminate all my Flickr dependencies regardless.

It took me about one and a half working days of time to replace my Flickr hotlinks with native uploads and completely resolve all my Flickr dependencies. And I barely ever used Flickr. Very regular users with much more extensive dependencies could be looking at weeks – possibly months of work. Plainly, that’s an impractical proposition, which means that realistically, some would feel no choice but to submit to Flickr’s demand for a subscription fee.

So, did Flickr deliberately create the dependency, and did Flickr deliberately exploit that dependency to force users to pay?

Photography

SPECULATION

There’s been a change of management in between Flickr’s “eat all you like – it’s free!” invitation and the “pay us or we’ll give you a stomach-pump” ultimatum.

That appears to have persuaded defenders of SmugMug CEO and current Flickr owner Don MacAskill, that extortion could not have occurred. I mean, it was just Yahoo making a stupid business decision, and poor old MacAskill coming in to pick up the pieces, right?

Some supporters of the new regime have also reminded opponents that the subscription is invested back into Flickr and will create a better site. However, the fact that MacAskill bought Flickr at all suggests he wasn’t exactly falling over himself to invest SmugMug’s profits in SmugMug. So will Flickr subscriptions really go back into Flickr, or will they just be used to pay for further acquisitions of tech real estate?

Opposing voices, meanwhile, have said that the management change makes little if any difference. It’s not like MacAskill bought Flickr, asset-stripped it and then started a new brand. He chose to take over an existing business, trade on the name of that business, and benefit from the business’s history. In so doing, he must also take responsibility for the business’s history. And even if he were categorically deemed unaccountable for Flickr’s previous decisions, would he not still, by definition, be guilty of extortion if proven to have made the deletion threat purely with the intention of forcing platform users to pay?

One of the most compelling suggestions that the deletion threat was made in the spirit of blackmail, rather than to manage the availability of storage space, is 1,000 photo limit.

A maximum number of photos means very little in storage terms, because the storage space for a thousand images of different sizes and compression rates could vary so wildly. If a user chose to upload 1,000 photos at 15KB each, that would add up to just 15 megabytes of storage. If they chose to upload 1,000 at 200MB each, it would be a whopping 200 gigabytes of storage. So one can’t say that the 1,000 max meaningfully controls storage allocation per user. A maximum number of photos is relevant to users. Not to Flickr. It’s clearly, therefore, a measure designed to influence users’ decisions.

The business reasoning behind a storage limit doesn’t matter if it’s set as an initial policy. The problem lies in the change of a policy which has created dependency among users. Then the reasoning does matter, because there could be a deliberate exploitation of that dependency.

BUT SHOULDN’T USERS WITH A HIGH DEPENDENCY ON FLICKR BE PAYING ANYWAY?

Supporters of Flickr’s move have said it’s only right that photographers who depend on Flickr should pay for the service. The service costs money to run, after all. I don’t agree, and I’ll explain why in a moment. But even before we get to the balance of value, legitimate business abides by its offers. Making an offer, and then retracting it once it’s been accepted, is not legitimate business.

But more importantly, the reciprocal benefits photographers have given to Flickr have been hugely overlooked in the ongoing debate. The situation has relentlessly been presented by supporters of MacAskill as if Flickr has gained nothing from its photographers, and has been doing them all a huge favour for five plus years. But the reality is that without its photographers, Flickr would be worth literally nothing.

Here’s what photographers have contributed to Flickr…

  • Content. In a lot of cases, high-value content, which incurred the photographers in significant time and skill. Content is the most valuable commodity on the Internet, and whilst they typically play it down, tech companies know that very well. Content is a universally-acknowledged form of platform marketing, and it possesses elevated power in that it’s the only form of online marketing that consumers will proactively chase.
  • Ad revenue. Yep. Flickr drove ads against photographers’ content, and at the photographers themselves, and it made money.
  • Interactivity and engagement. It should not be forgotten that online communities need applause and interaction to keep the creatives posting. Without that digital applause and discussion, most photographers would have nothing at all to gain from Flickr, as the platform has not offered a direct means for creatives to monetise their work. Result? No engagement or encouragement; very few new posts. As well as providing content, photographers have been the core providers of encouragement and applause to other photographers.
  • Backlinks to Flickr from third party sites. Images hotlinking to Flickr on other sites provide links to Flickr itself, and thus promote the platform and raise its profile.
  • Copyright management. When images get stolen from Flickr, as they do, on a perpetual basis, it’s the photographer – not Flickr – who undertakes the copyright management work or expense. That work has an enormous monetary value in itself.
  • Data. The Flickr Privacy Policy permits the company to collect and sell ‘aggregated’ user data, and there’s no doubt at all in my mind that it does. This, again, has a monetary value to Flickr.
  • Fodder for scraper sites. Scraper sites use Flickr’s API to appropriate content from the platform and re-publish it. These sites have benefitted Flickr enormously, since they provide millions of backlinks. However, without the photographers’ content, they couldn’t exist.

So, much as Don MacAskill might like the world to see a vision in which all photographers are fiscally worthless and indebted to Flickr, that really isn’t the case. Flickr is more indebted to photographers than photographers are to Flickr.

THE VERDICT?

So, do I think Flickr is guilty of ‘freemium extortion’? Well, I don’t believe Yahoo foresaw Flickr shifting-towards a subscription-only business model back in 2013. That was before even ImageShack changed its business model to subscription-only, and at the time, trends had been heading decisively towards advertiser-funded image sharing. That doesn’t, however, necessarily mean Yahoo saw itself retaining Flickr in the long-term. It’s quite feasible that they intended to fatten up the platform for sale. But without documentary proof that they knew their 2013 policy change would be reversed on pain of ransom, Yahoo could not reasonably be accused of hatching an extortion plot.

But new owner SmugMug’s actions have been more clearly questionable. In my opinion Don MacAskill has made a threat specifically to exploit users’ dependency on Flickr and force them to pay a subscription fee. He’s claimed to be passionate about photography, but has made his threat without concern for the large volume of important historical matter that mass deletion would strike from the Internet. He’s also shown his true character, refusing, on the Flickr Help Forum, to answer a user’s question about how to export their images, and instead responding with a prompt for them to subscribe. Everything about him, apart from his rhetoric, says he has one interest only, which is grasping as much money as he possibly can.

Whilst proving that MacAskill’s actions amount to extortion would be difficult, his behaviour has not been a pretty sight, and if I were a subscribing photographer on Flickr I would have grave concerns about the precedent he’s set. My instinct would be, and indeed was, to eliminiate all dependency on Flickr as soon as possible, and neither upload nor hotlink to Flickr again. [UPDATE: I fully deleted my Flickr account on 26 April 2019].

This scheme appears to have worked for Flickr in the immediate term. I know a lot of users have reluctantly subscribed. But how it will play out in the long term, as the active userbase shrinks, and engagement shrinks with it, is another matter. People are much more trusting than they should be on the Internet, so it’s hard to tell if trust issues could damage Flickr going forward. They should do, but they may not.

And that brings us to the broader question: where does this kind of behaviour end, across the web in general? Could ‘freemium extortion’ – effectively locking people into free plans, and then demanding money – become a widespread, deliberate business model? Could startups strategise to offer their free account holders all sorts of unsustainable benefits, whilst arranging to sell the business to someone who will financially exploit users’ dependencies once they’re ‘locked in’?

Is this already happening? How long before your email provider threatens to confiscate your email address and give it to someone else if you don’t pay a subscription charge? That’s only a very small step from what’s happened at Flickr, and we should all be concerned about such tactics.

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