How Much Revenue Does Flickr Make From Paid Pro Accounts, My Guess? $50 Million Per Year
Over at Quora today somebody asked the question, How many Flickr accounts are pro accounts? Yahoo doesn’t make the number of accounts or Flickr’s financials public, but I thought I’d just do a brief bit of guessing on my own. Note that this is in no way scientific and probably somebody could use the API or a more detailed sampling to get better results.
The most recent mention of the total number of Flickr users that I’ve seen comes to us from a news release from Yahoo back in November 2009. At that time they were announcing a Flickr/Snapfish deal and in their release they mentioned Flickr’s “more than 40 million members.” While “more than 40 million members could actually be any number greater than 40 million, if we assume that 40 million was close to the number of users at the time this gives us a starting point.
According to compete.com (and take their statistics of course with a grain of salt), since November 2009, Flickr’s traffic has dropped about 18%. So if we reduced the 40 million number by 18%, we get about 32.8 million Flickr accounts. There very well may be more or less, this is just a very rough estimate.
I did a Flickr search for the names “John” and “Jane” and sampled the first 100 accounts of each that came up. Of those accounts 7 were listed as deleted (but still seemed to be on the system), 14 were listed as paid Pro accounts and 179 were free accounts. One might guess then that 7% of Flickr accounts are paid Pro accounts based on this name query. So 7% of 32.8 million would be 2.29 million paid Pro accounts. At $25 per year that would be about $57 million per year in revenue from Pro accounts.
Of course there are other things to think about in this guesswork as well. Some people pay for 2 years of Pro account at once. For these accounts Flickr gets $24 per year not $25.
Also my sample using the names “John” and “Jane” probably have a higher percentage of Pro accounts than they should. Someone using an actual proper name is probably more likely to be a legitimate account and less a free throw away account. In looking at the first 100 profiles simply for a user search by the term “a” (which produced far fewer proper named sounding accounts) the percentage of Pro accounts was far lower.
Given the the fact that my percentages are probably high and some people pay $24 per year instead of $25, I’m going to make a ballpark guess and say that I think Flickr generates about $50 million per year from Pro account subscriptions on about 2.1 million paid Pro accounts per year. Flickr also receives advertising revenue, of course, from free accounts. They also probably get a small cut of the Flickr/Getty stock photography sales as well as minor revenue from things that they do like the Corporate account thing (for companies like Starbucks and McDonalds, Snapfish photo printing, etc.).
On the other side of the equation, Flickr currently has a (smaller recently) staff of about 51 employees according to the “About Flickr” page. They also have the expense associated with storing all of the 5.3 billion photos or so that they store and the bandwidth costs with serving them up, relatively expensive (and soon to be even nicer, with a hot tub) office space in San Francisco and other various expenses. The first time I saw Flickr mention that they were profitable publicly was in a San Francisco Magazine article in April of 2009. (At that time as an aside they quoted 35 million members).
How profitable is Flickr? Your guess is as good as mine. I suspect that after you back out all the costs on their revenue though that it’s not a meaningful or significant number for Yahoo.
Maybe I’m right, maybe I wrong, maybe I’m close, maybe I’m way off, who knows. Note this post only addresses what I’m guessing Flickr makes from *Pro* accounts. Obviously Flickr has other sources of revenue (including advertising).
If anyone has any feedback or sees a way this guess might be improved, let me know in the comments.
Update #1: I did a bit more digging and was able to find this Yahoo page that talks about “advertising opportunities” on Flickr. According to this page at least, Yahoo is claiming that Flickr represents: “a far-reaching community of 51 million registered members.” So my initial guess of 32.8 million would indeed seem to be low. Of course with the reduction over the past year in Flickr’s traffic, it could be that a lot of these are dead or inactive accounts. I should also note that in the comments it was brought up that some of the Pro accounts on Flickr are unpaid Pro accounts and are part of a deal (at least in New Zealand) where users get free Flickr Pro accounts as part of their broadband service. I’d think that these sorts of accounts would not pay very much (if any) revenue directly to Flickr. Yahoo probably benefits in terms of directed traffic from the providers, but probably not in dollars and cents directly to Flickr. I’m not sure what percentage of the Pro accounts on Flickr would be characterized as this type, but I only know of this being done in New Zealand at present.
Yahoo seems to be pitching Flickr as a site that is rich with Millennials (People 15–24) and affluent 18-34 year old men and lists the following advertising opportunities on Flickr:
“Flickr Homepage: Engage members instantly with the first ad they see on Flickr. (Roadblocks available; does not feature expandables or overlays; video must be user initiated.)
Photo Pages: Align your ad placement with striking images.
Search Page: Get high-volume reach—millions of photo searches are conducted daily.
Upload Page: Take advantage of upload downtime, and catch members’ attention while they wait. (an opportunity for Rich Media–enabled video)
Groups Main Page: Capture users as they manage their Flickr groups. Sponsors can also drive traffic to their own groups.
Sponsored Groups: Create a home for your brand on Flickr with an interactive sponsored group. Target and inspire members with a call-to-action rally, compelling them to join the group, share relevant photos, and create buzz around the brand.
API License for Sponsored Groups: Extend the impact and reach of a Flickr sponsored group. Inspire lasting user engagement by feeding group members’ photos onto your own branded sites by using Flickr’s open code.”
Update #2, Cal Henderson (former Flickr Chief Software Architect) suggests over on Marshall Kirkpatrick’s post at Read/Write Web that advertising actually makes up a far greater component of Flickr’s revenue than people might think. This would make sense, but since the most active/affluent flickr members are more likely to have Pro accounts (which don’t see ads) I wonder how valuable Flickr’s ads really are to marketers. Cal says my calculations of flickr’s earnings are “extremely flawed,” and adds:
“1) Ad revenues: Flickr is the 35th biggest traffic’d site on the web, accounting for about 1 in every 500 pages views. It serves *a lot* of ads. Billions a day.
2) Getty: Flickr gets a cut of photos licensed through Getty. This is a non trivial amount.
3) Other partnerships. This is also a non-trivial amount.
I can’t give you any figures, and it’s up to you whether to believe me or not, but pro sales are only a portion of revenues.