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  1. #1
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    Lightbulb Charging royalties on work. Advertising agencies do it, why not the little guy?

    Hey all,

    Why I havent been doing this sooner I dont know why, but are there any designers or developers that charge royalities on the use and copyright of their work for periods of time?

    For instance if I designed an advertisment or a website for a large company and that company used my design for 2-3 years, do other designers write into their contracts that they should be paid for the use of their work if it is used for extended periods of time etc?

    Eg. Designed a yellow pages advertisment for $1000.00 Costs the client $7000.00 just to put an add in the directory each year. I should be getting something if they want to use my ad again next year right?

    Ive always come from the view that I get paid for actually creating the work and then nothing more. How do others go about it? Probably been missing out on some money for quite some time now, Ill have to fix that up.

    Makes sense to me, my work is making money for the client, I should be entitled to something over time.

    This new thinking to me all came about due to a client leaving me, and then there new designers asking for the original source files, so that they can use and be paid for my hard work, which didnt fit well for me. A quick talk to me solicitor has revealed I still own the copyright to the work and that most agencies he has delt with have set terms on who owns the copyright and set fees for the use of the designed work.

    Any other opinions experiences on how to go about setting up my terms/contracts, without making myself look overpriced.

  2. #2
    In memoriam gold trophysilver trophybronze trophy Dan Schulz's Avatar
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    [A]re there any designers or developers that charge royalities on the use and copyright of their work for periods of time?
    Nope. If I did that I'd be laughed right out of business and into the gaping maw of a homeless shelter.
    Ive always come from the view that I get paid for actually creating the work and then nothing more. How do others go about it? Probably been missing out on some money for quite some time now, Ill have to fix that up.
    You make up for it in other ways. Hosting, maintenance agreements, updates, and even modfiications and upgrades to the Web site.
    This new thinking to me all came about due to a client leaving me, and then there new designers asking for the original source files, so that they can use and be paid for my hard work, which didnt fit well for me. A quick talk to me solicitor has revealed I still own the copyright to the work and that most agencies he has delt with have set terms on who owns the copyright and set fees for the use of the designed work.
    Assuming you're in the United States, unless the work you did was specifically "Work for Hire" you own the source files, and can rightly tell the new designer to go jump off a cliff and do their own work rather than reaping the rewards of your hard labor.

  3. #3
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    In the end, it's your business and your terms, so you can ask your client to agree to anything you want. Of course, if the rest of your peers don't charge these ongoing licence fees , it's unlikely your prospective clients are going to go to you unless you stand out from the crowd in some other (desirable) way.

    As for ownership and copyright, again it depends on your contract. If you don't specifically transfer ownership to your client (work for hire) then the work does officially remain yours. But I really do think you're dreaming if you think you can charge an ongoing licence fee for a design element (e.g. ad, logo, site design).

    Software is different IMO, I always retain ownership to all code and licence it to the client. The cost of this licence will depend on the situation - if the software was pre-developed (i.e. my company's CMS), then it's licenced as a commercial solution which involves a monthly fee. On the other hand, if my client had paid for the development of the script, I retain ownership and rights to exploit (unless the client wishes to pay significantly extra), but the license for the client using it is free.

    In the situation you have described, I would say that ethically (but not legally unless otherwise stated in your contract), your client owns the 'design' - i.e. the end result as GIFs and JPGs, but you hold ownership to the source files - i.e. the PSD, FLAs etc. Hence I see no problem with you charging for the release of the source files to these new designers, especially if you no longer have any sort of relationship with the old client. Once again, it goes back to what was stated or not stated in the contract.

    But I really don't see how you'll get away with ongoing royalties.

  4. #4
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    ongoing royalties for work, isnt that how medium to large advertising agencies operate?

    Ive never worked inside one.

  5. #5
    SitePoint Evangelist adesignrsa's Avatar
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    What about offering a reduced up front rate, and then a royalty? Otherwise, I don't see a reason that a client would do it with you if people out there are charging the same as you without the royalty factor?!

    This is the only feasible way I can think of this working...
    Ross Allchorn
    Web Consultant
    www.allchorn.com
    Twitter - @allchornr


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