That kind of inflation makes it harder to argue that publishers get their money back in any direct way. In most cases, the magazine is paying only for the exclusive rights to use the pictures for a week or two. (Magazines usually buy the photos through an agency, partly to avoid the appearance of directly paying celebrities for access, though publishers and editors no longer bother with any pretense about where the money goes.)
But executives at the magazines, while refusing to discuss specific photo fees, insist that the widely reported prices are wrong or misleading and that the true costs to their companies are much less. And they say that the most important factors are impossible to measure: the value of being known as the place to go for those pictures, and of keeping them out of a competitor’s hands.
“The consumer’s expectation is if the photos are going to be available, I’m going to see them in People,” said Paul Caine, the publisher of People magazine, a Time Warner property. “If we don’t get them, we miss that brand promise, we lose the halo that goes with that.”
Larry Hackett, People’s editor, said, “Last year, we lost a couple of weddings because OK! magazine was willing to spend more money than we thought made sense.” If that sort of thing becomes common, he said, “they’re going to get traction, and I don’t want any competitor to get traction where I can stop it.”
OK! does not turn a profit, its publisher, Tom Morrissy, said, but it spends heavily for big exclusives to establish itself and gain a following. This may be working; The magazine, part of the British media conglomerate Northern and Shell, had a circulation of more than 900,000 in the second half of 2007, far behind People’s 3.8 million, but growing fast.
Magazine editors need an acute sense of how a celebrity cover will sell at a particular moment, and sometimes they get it wrong. Brad Pitt and Angelina Jolie have been money in the bank for years, but putting Christina Aguilera and her new baby on the cover in February did not do much for People’s sales. Anna Nicole Smith and those around her attracted readers while she lived, but were a bigger attraction in the months after she died.
“It’s always a bit of gamble,” said Sarah Ivens, editor of the American version of OK! “You have to trust your instincts.”
An exclusive set of pictures, with one on the cover, can increase newsstand sales, but rarely by enough to sustain a payout of $1 million or more. Even at the full cover price, analysts say, each extra copy that a magazine sells above its norm generates less than $2 in income.
The domestic record for a sales increase may belong to the issue of People in 2006 with the first published pictures of Ms. Jolie’s and Mr. Pitt’s baby, Shiloh, which sold 800,000 more copies than usual. (Published reports said the magazine paid $4.1 million for those photos — a record at that time, which the parents gave to charity — though People says that figure is wrong.)
More commonly, an important exclusive sells an extra 300,000 to 500,000 copies — providing less than $1 million in added earnings. But that is just the American part of the ledger. Exclusive pictures have a greater effect on Web traffic; People.com briefly doubled its usual number of online readers when it featured Ms. Lopez’s twins, with about four million viewers in a single day. That kind of traffic can translate into more advertiser interest, but the magazine does not disclose such data.
When a magazine pays a lot of money for pictures, it often uses the domestic rights and sells the international rights to someone else, so the net cost is much lower than the initial payout. That is what People did with the pictures of Ms. Lopez and family.
For OK!, a set of pictures can be used in magazines around the world. The American OK! is a spinoff of a celebrity weekly based in Britain that is sold in dozens of countries. Northern and Shell also licenses a dozen foreign-language versions.
The company paid a reported $2 million last year for pictures of Eva Longoria and Tony Parker’s wedding, with audiences in several countries in mind.
“ ‘Desperate Housewives’ is a big hit in Europe,” Mr. Morrissy said, “Tony Parker is from France and Eva Longoria translates very well internationally.”
British magazines and tabloids have a history of fierce competition and of paying for access. But at the start of the decade, no American publication was paying high prices for pictures because People had the field nearly to itself.
That started to change when Wenner Media’s Us magazine went from monthly to weekly in 2000 and began to compete more aggressively, starting a circulation climb to almost two million today from about 800,000. In the next few years, Bauer Publishing introduced In Touch and Life & Style.
Suddenly, there were bidding wars for pictures, most taken by freelancers. Magazines were paying tens of thousands of dollars for run-of-the-mill pictures of celebrities leaving restaurants — pictures they did not consider good enough for their covers. That contributed to an explosion in the number of paparazzi chasing celebrities, which in turn led to more pictures, and prices leveled off.
Then OK! arrived in August 2005, with Northern and Shell’s resources behind it and a willingness to pay six and seven figures. People, widely acknowledged as the most profitable magazine in the country, followed suit; Us Weekly and Bauer have chosen not to compete at those prices.
“This is a long-term strategy for us,” Mr. Hackett, the People editor, said. “I don’t enjoy paying these large amounts of money, but I do enjoy our readers having these pictures.”
