The fabulous Ipad is churned out by Foxconn for Apple at their massive plants in Shenzhen. The worlds biggest outsourcing company Foxconn employs more than 800,000 workers in China at the official minimum wage as set by the Chinese dictatorship and without the protection of a trades union. There are also Foxconn plants in Southern India where recent factory occupations protesting at alleged chemical poisonings were broken up by police. The military style work regime and bullying of workers at Foxconn have become notorious, as have the suicides amongst the mostly migrant workforce. Foxconn announced pay rises to try and improve its tarnished image which had endangered the reputation of Apple and other household names — only to claw back the increases by removing existing bonuses, changing overtime arrangements, increasing financial punishments, speed-ups, increased daily quotas etc. etc.
Protest in San Francisco at the long hours and bad conditions at the Foxconn factory in southern China © David Bacon/reportdigital.co.uk
Whilst this sounds like something out of Dickens the relationships of exploitation are somewhat different from the 19th century “dark satanic mills” in the UK and even from the “Fordism” of the postwar period – The American Century (where advanced capital intensive mass production techniques were exported by America to Europe and the rest of the world) – in that very little of the surplus value generated remains in the producing country. Foxconn operates on a wafer thin profit margin – they are seeking even cheaper labour elsewhere in Southeast Asia and of course are very concerned that strikes may result in higher wages. Whilst only costing a few dollars to produce in China, the sale of an Ipad in the West will be for 10 or 20 times that — with the massive profits going to Apple in the West.
The smooth operation of this globalised system is threatened as national governments fall out over who’s going to pay for the current crisis — the USA is continually calling for China to revalue its currency to make American exports cheaper. Japan has already stepped out of the agreed international consensus dumping $23 billion of the Yen recently and the IMF is struggling to avoid a currency war. As a comment in The Wall Street Journal put it: “rather than providing a life raft, competitive devaluations are more like shipwrecked sailors trying to stay afloat by climbing on each other’s shoulders”.
However, in America and Europe publishers are getting terribly excited as the Ipad brings together the possibility of publishing rich content in new ways and — unlike the web currently — receiving remuneration for doing so. Aggregating and disseminating existing content — “churnalism” — will not cut it here and there is the possibility that subscriptions and one-off App. purchases will actually save an ailing industry (though I suspect most newspapers would be rather more profitable if it wasn’t for the debt they incurred consolidating and as a result of the internet give away). Content could be originated by professional journalists who are paid properly for their skilled work.
Negotiations between Apple and the publishers have not been entirely straightforward – Apple have tried to apply a censorship of nipples (they have a conservative policy on these) – a German magazine published an App. in which the more you shake the Ipad, the more clothes the woman loses. There doesn’t seem to be a plain brown paper wrap, a “top shelf” or an “under the counter” at the Apple Store, explicit material will doubtless be streamed to the Ipad from elsewhere. Ebooks have maximum prices set by Apple for most categories at $9.99 and Apple takes a wopping 30%. A digital “News stand” is anticipated with Apple wanting 40% of the advertising revenue from digital newspapers in addition to 30% of the subscription. Further disagreement has emerged over who controls valuable consumer data. Many magazines and newspapers have already launched their Apps with an early adopter The Financial Times reporting that their iPad app has generated over $1.5 million in advertising revenue in only five months.
Staff giving advice on using the iPad at the Covent Garden Apple store © Justin Tallis/reportdigital.co.uk
The production of photography and video for the publishing industry has tended towards monopoly: a smaller and smaller number of large companies with ever growing inventories suppling increasing volumes for an ever decreasing price – a good old fashioned “pile them high and sell them cheap and fast” Wide Moat Business Model. Whilst this strategy is excellent at removing any competition in the market – creating an dominant oligarchy with lavish “executive compensation” at the top (even if they don’t actually show much profit) – surely a barrier to progress if ever there was one- meanwhile, without any agreement on minimum rates the lowly photographers at the bottom find their existence increasingly untenable.
In contrast, an initiative appears to have emerged in the USA: a group of 20 picture agencies, mindful not only of the opportunities digital publishing presents but also of the necessity of sustaining production, have joined together to suggest to Ipad publishers that a set of minimum rates be established. The full text of their email is below. Should these producers establish such “restrictive practices” one imagines the aforementioned Wal-Marts of photography will attempt their destruction and absorption. Will this be the beginning of a sustainable future for these agencies or their last stand?
September 29, 2010
The following members of EPAG hope this email finds you well. Abaca, Admedia, Bauer-Griffin, BEImages, Big Pictures, BuzzFoto,Celebrity Photo Agency, Elevation, Fame Pictures, INF,PacificCoastNews, PictureGroup, PhotoLink, RameyPix, RexUSA, SipaPress, Splash, Star Max, Startraks, WENN
We are contacting you today in hopes of discussing a few key issues relating to the licensing, pricing and use of our agencies images in your publication’s “apps” and tablet “iPad” equivalents. The agencies listed below have recently formed a guild called EPAG (Editorial Photo Agency Guild) to raise awareness about these pressing issues facing each of us as we all move forward in the digital publication age. As these new platforms grow in popularity with consumers, it is our belief that the licensing of these images should be treated independently from what you already pay for with respect to the print and .com versions. Photo agencies are hoping for the success of this new technology as much as anyone. The iPad and similar platforms can both bring in new readers and enhance the experience of existing readers, as described above. More happy readers mean more revenue and more success for the entire industry (including us). To a large extent, our goals are the same as yours. A recent report conducted by five of the most important publishers in the world concludes: New study forecasts $3 Billion in Subscription Revenue for Interactive Periodicals by 2014. Here is what we propose:
1) Include iPad/E Reader usage in the current print pricing by adding a $50 minimum for Red Carpet or $100 minimum for Candid non–exclusives or 25% to the print price agreed, whichever is the greater, for the first 6 months, 50% for the following 6 months, and 100% of the current fee paid after 1 year. We will agree to look at pricing in one year before implementing the 100% price by assessing the traffic, profit and success of the App with the publisher as a co-operative strategy to show we aren’t blindly thinking of applying 100% unless its achievable for both sides. Exclusives to be negotiated each time. 2) Images used independently of the print edition (bonus sections or any other additional uses by any publication) Recognizing that E platforms are new, EPAG is prepared to ramp this up at 50% of the estimated print price for the first 6 months. After 6 Months, we would renegotiate these fees based on iPad/E reader traffic, ad revenue and market share. 100% goal subject to assessment. Exclusives to be agreed separately 3) All images used need to be reported to the relevant agency in a mutually acceptable format We remain extremely dedicated to offering the best images in order to bring to your readers the best experience possible. We would like to take this opportunity to setup a short meeting with you to discuss the potential for this new service offering and how best to work together on making it a success.
Sincerely,
EPAG.editorial@gmail.com
Abaca, Admedia, Bauer-Griffin, BEImages, Big Pictures, BuzzFoto,Celebrity Photo Agency, Elevation, Fame Pictures, INF,PacificCoastNews, PictureGroup, PhotoLink, RameyPix, RexUSA, SipaPress, Splash, Star Max, Startraks, WENNIf you would like or to join EPAG or just need more information email EPAG.editorial@gmail.com
Foxconn latest: Ipad 2 Factory Explosion Kills 2 Workers, Injures 16, Apple said it is “deeply saddened by the tragedy”.
