What's the size of the global type market?

thierry blancpain's picture

I've been wondering recently, what's the amount of revenue of the global type (fonts) market each year?

This figure would include the revenue of all the indie foundries, of the large players like Monotype, and of resellers like FontShop and MyFonts, webfont services like Typekit, but exclude type-related software products like FontLab or Linotype FontExplorer X. Basically all the revenue that is generated directly through font files.

What's your guess?

hrant's picture

I don't guess. But I am listening.

hhp

Stephen Coles's picture

You can get a big chunk of this by looking at the public earnings statements of Monotype and Bitstream (who formerly owned MyFonts).

thierry blancpain's picture

Monotype's 2011 annual report states they had creative professionals revenue* of roughly $31,556,000.

Now the question is, how much of a market share does MT have in this area? A lot of their sales (and growth in creative professionals revenue) is from non-web, direct to corporate customer sales. I take they own a very large share of that market, but am unsure about the web retail market. Given that they own fonts.com, this will also be a decent chunk. But Myfonts.com is of course not yet on their balance, given they only acquired it in 2012.

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* "We derive revenue from two principal sources: licensing our text imaging solutions to CE device manufacturers and independent software vendors, which we refer to as our OEM revenue, and licensing our fonts to creative and business professionals, which we refer to as our Creative Professional revenue."

MT's 2011 Annual Report is available on their corporate website.
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thierry blancpain's picture

The question really is, how big a chunk of the market does MT own?

Also, Bitstreams' revenue is around 13m: "For the full year 2012, Monotype Imaging expects Bitstream's font business to contribute approximately $13.0 million to $14.0 million in revenue"

(From http://ir.monotypeimaging.com/releasedetail.cfm?ReleaseID=658188)

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This adds up to 45m+ for what MT will probably have in terms of fonts revenue in 2012. Do they own more than 80% of the market?

Si_Daniels's picture

>The question really is, how big a chunk of the market does MT own?

I'd guess about 150%

thierry blancpain's picture

I've been thinking about this some more. While MT will earn a lot through royalties themselves, a lot of that revenue will also be their fees for selling through their sales channels. While at first I thought MT had something like 80% of the market, I'm now thinking that it could be more around 60%, especially if custom type projects for large clients are part of the mix – those can have quite the price tag.

What do you think? Will anybody talk about this openly?

Stephen Coles's picture

I don't see a reason why anyone would talk about their earnings openly unless it was beneficial to them or the industry in some way. Something like the AIGA Salary Survey, perhaps.

oldnick's picture

Okay: I suppose that I can break the ice.

Gross revenue on my fonts from all sources for 2011 was just north of $100,000, my second-best year so far. Of that amount, various sales agents collect from 35% to 82% of the gross amount. I launched a new product in February, which is on track to add another $40,000 gross to the total, half of which will accrue to me.

5star's picture

82% really?

WTF!

n.

oldnick's picture

No, not WTF: ITC.

.00's picture

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Si_Daniels's picture

>I have to say that my gross figures are larger than oldnick and I get to keep it all!

Does the tax man know? He does now :-)

.00's picture

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Nick Shinn's picture

I get to keep it all!

Nonetheless, I think you’d come out even further ahead if you also sold through distributors. They reach a great many customers who have never heard of Terminal. Font Bureau and Emigre, two of the oldest digital foundries, were slow to adopt the distributor route; I doubt they have any regrets.

IMO, the only downside is the time it takes managing one’s dealings with distributors, which are becoming increasingly complex. Especially as they all want to do things differently, from ad sizes to webfont formats.

thierry blancpain's picture

Yeah, I didn't expect single foundries divulging their foundries' revenue, but taking more educated guesses at what percentage of the market MT owns nowadays. I for example have absolutely no idea about the revenues of orgs like Adobe Type, FontShop, FontFont, Emigre, etc. – so hearing any kinds of numbers puts everything into perspective and allows for a better overall picture.

Thanks to those who've already talked openly about their revenues! I'll try to take out some time next week to put together a rough calculation based on the publicly available numbers – will also try to find Adobe's numbers.

oldnick's picture

James,

It’s good to hear that fonts have been berry, berry good to you, and that hard work and dedication pay off. As for me, a reasonable balance of indolence and time spent doing something that interests me while earning more that I would in a regular day job is A-OK. Plus, my partner in my latest venture has suggested slicing and dicing my latest package for resale in the App Store, so I might have to revise my numbers upward a bit.

As Bucky Katt says, “At the end of the day, it’s all 24/7.”

daverowland's picture

Without suggesting anyone reveal their actual incomes, would anyone care to share the percentages of their income (after royalties) from various distributors? I'm in the process of signing up with Fontspring and have also been offered a contract with Monotype (since the MyFonts takeover) to list through linotype and fonts.com.
I'm interested to know whether, given the reduced royalty rate from Monotype, the extra exposure (if there is any) is worth the effort. While Fontspring use the same size promotional graphics as MyFonts, for Monotype I'd have to make new ones in different sizes, which is something of a hassle if the numbers don't add up!

To get the ball rolling, I'll start:
Income from font distributors:
MyFonts 100%
;)

.00's picture

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hrant's picture

I think you’d come out even further ahead

In fact James is in an ideal position to test the relative viability of a distributor versus going it alone. I think Jackson Cavanaugh* might be trying something just like that, since he's on MyFonts but his latest release is only available directly.

* http://okaytype.com

hhp

daverowland's picture

I guess after he's sold it to everyone who knows their stuff and would buy from him direct, he'll put it on MyFonts for a 'second wind' of sales. Makes good sense to list exclusively first (100% royalties!) then with distributors later as sales dry up a bit.

blank's picture

I'm interested to know whether, given the reduced royalty rate from Monotype, the extra exposure (if there is any) is worth the effort.

I intentionally never signed with Monotype because I did not want to be associated with that company. Unfortunately I was rolled in when they bought another vendor. I sell almost nothing through Fonts.com relative to MyFonts and Fontspring. Monotype really is not going to do anything for you that Fontspring doesn’t, so there’s no good reason to accept their low royalty rates or risk them getting a OEM sale that you might have picked up directly had your work not been listed with them. Tell them to match Fontspring or take a hike.

hrant's picture

The thing is Dave that fonts -especially display fonts- are subject to fashion (including going out of fashion through over-use) so a font that sells very well at a given time probably won't sell nearly as well later on.

hhp

daverowland's picture

a font that sells very well at a given time probably won't sell nearly as well later on.

A good reason to stagger releases through separate distributors then.

dberlow's picture

SC: "I don't see a reason why anyone would talk about their earnings openly unless it was beneficial to them or the industry in some way."

You mean: beyond tax laws, you don't see a reason why anyone would talk about their earnings openly?

oldnick's picture

beyond tax laws, you don't see a reason why anyone would talk about their earnings openly?

Probably for the same reason most guys don’t compare the size of their penises after a certain age: it’s simply not done. By straight guys. Except in locker rooms, where the guys who have been “blessed by Mother Nature” make no attempt whatsoever to hide that fact.

And James: Chico Escuela. Bucky Katt. No offense taken, none offered in return.

.00's picture

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Frode Bo Helland's picture

oldnick: showers vs. growers.

thierry blancpain's picture

Aaaaand that's how a discussion about the global type market size turns into a discussion about penis sizes.

dberlow's picture

Which brings us to the question of whether or not the web is the Viagra of font sales?

oldnick's picture

Aaaaand that's how a discussion about the global type market size turns into a discussion about penis sizes.

I guess all roads lead to Rome, sooner or later…

Ryan Maelhorn's picture

I'd love to see some demographics, even just for Myfonts.

For example, knowing what the bell curve looks like for number of units sold over price per unit, weather the majority of buyers are working in some way for design firms, or if they are just regular people with no real design knowledge. Knowing thigs like this would change how I go at the game in the extreme.

I have thought often about whether I would gross more overall if I priced my fonts incredibly low ($5) or relativity high ($100). I'd certainly rather sell 30 copies at $5/each then only one copy at $100/each. But without knowing what the demographics are and average and mode, median, and all the math, it's hard to tell which strategy would work better.

dezcom's picture

Much of it depends on your products fit to the market. The $5 folks have much less need for broad character sets and don't perceive quality as well as your $100 folks. It is not about just bumping the price tag. The product has to fulfill that market's needs.

Synthview's picture

I’m on myfonts, monotype and fontspring.
Gross :
Myfonts 70%
monotype (linotype, myfonts etc) 20%
fontspring 10%

Please note some traffic to these 3 websites comes directly from my website.

oldnick's picture

The $5 folks have much less need for broad character sets and don't perceive quality as well as your $100 folks.

On the other hand, some people have champagne tastes, but only beer budgets. Similarly, a higher price does not guarantee quality, although it may reflect an expectation of same. You don’t always get what you pay for: sometimes you get more, sometimes you get less.

dezcom's picture

Very true, Nick. But for the person aiming at the market, one would hope thy would have honesty of purpose.

blank's picture

The $5 folks have much less need for broad character sets and don't perceive quality as well as your $100 folks.

I disagree. Broad character sets were developed to add support for central and eastern Europe, where income levels are often much lower than the US and Western Europe. These are also places where piracy is often considered the normal way of doing business. I have often wondered if there is a good way to target these markets with lower prices than those charged to the wealthy nations. This is actually something that could be easily addressed by mapping font prices to geography, verified by IP address and credit card data. Some font vendors—most notably Veer—already do this, but only to charge higher prices in the UK and Euro zone, and without lower prices where they would be appropriate.

hrant's picture

I like that sort of thing (although I'd worry about the tracking methods you mention). And I would broaden it to non-affluent people anywhere:
http://www.typophile.com/node/10206

hhp

sko's picture

Could fonts be made without the latin alphabet or are those glyphs required for the CE languages as well?

oldnick's picture

I have often wondered if there is a good way to target these markets with lower prices than those charged to the wealthy nations

I try to accommodate equal opportunity at affordable prices. I’m in the process of updating my entire commercial library to support the 1250, 1252, 1254 and 1257 codepages for the same retail price—typically a rousing 7.95 U.S. Dollars, with quantity discounts available. The current line contains all the aforementioned except the Baltic-specific characters—all autohinted (because the vast majority are display faces, typically used in larger sizes) but manually spaced and kerned.

dezcom's picture

The CE glyphs all use the Latin alphabet as a basis with a few exceptions. Most of the work involves the diacritics which are rarely seen in English but essential to most other languages that use the Latin script.
Regarding pricing dovetailed to users, I don't think it is just a geographical issue. There are plenty of $5 font users in the Americas and Europe. I don't see how anyone could enforce it without great cost. We cannot even enforce the system we have. There are type designers all over the World including the countries you might target as having a lower cost of living. The type designers there share that lower cost of living and can support their own nations if they so desire. It would be equally unfair for a type designer living in the UK and paying that cost of living to sell his work at less than he needs to survive where he lives.
I am more in favor of letting the type designer choose their own market or markets and doing the work that fulfills those needs. The clients of course decide with their wallets if the design has missed the mark. This eliminates the need for the income-level police from, most likely badly, enforcing the rules. Any wealthy person can buy an IP address from Mumbai so who are we helping? Only the poor have no options. The wealthy and or devious are quite adept at working around the best laid plans of mice and men. So just design what you choose and market to whom or where you choose. If you fail in your perception of the market, your balance sheet will soon tell you if you either need to revise your market strategy or the product you produce.

Thomas Phinney's picture

As a very broad ballpark, the *retail* global type market is likely somewhere around $100 million or more in revenue.

Custom and proprietary font development by commission not included.

Diner's picture

Just finding this thread well into it's evolution . . .

What's interesting is that a majority of the posts and posters here really only are looking at desktop sales and not counting OEM licensing at all. While Font Bros enjoys a fair and growing share of desktop sales for its foundries, we're best at obtaining a good deal of OEM licensing for all the folks we represent and it's paid at the 65% rate, same as our rate on desktop sales.

I think it's short sided to only look at annual desktop sales to determine the whole ball of wax and there isn't any designer among us who isn't thrilled to still make income off of fonts made 5 or 10 years ago.

This sorta gets back to the original topic about all distributors which is to say each has their own audience and it took me many years to figure this out. It makes perfect sense that a foundry could do great at 10 distributors without harming its own income, yet it becomes a matter of convenience for those who just don't want to hassle with setting up and maintaining their own web store, licensing, etc . . .

And there is no question it's a lot of time and effort that goes into making graphics, descriptions and getting a font prepped for resale that nearly always results in delayed releases.

Thomas Phinney's picture

Just to be clear, I don't mean to say the OEM and commission work is unimportant. Just that I have no idea how much it is. But as I do have a ballpark idea of the size of the retail type market, I'm sharing that. It's something.

Stuart, do you have any take on the size of these other markets?

Diner's picture

I'm willing to bet there is a mathematical statistical formula that looks like this:

(font release date - current date) + price point + scope of distribution + relative adoption/popularity = OEM licensing potential

The thought is simply that the duration of time a font has been 'out' directly affects the saturation of that font in the marketplace and accordingly the number of folks who find and wish to use it outside of the scope of it's initial EULA or licensed uses.

My conclusion is that older released fonts receive perhaps 4-8x as many OEM licensing requests as newer ones, so if you look at older more established foundries with a large body of work, chances are OEM font licensing could be anywhere from 20% to up to 45% of their annual income.

We also cannot rule out income generated from infringement settlements in cases where the font use has been egregiously abused and law suits are required to remedy these cases - It is a random thing, but it could account for 5-10% of annual income on a random given year . . .

My 2¢
Stuart

Nick Shinn's picture

…statistical formula…

I will continue to fly by the seat of my pants. (Trousers, you Brits.)
A certain amount of numerical engagement is unavoidable in this business, but in general I’m not a big fan of bean counting, whether it’s reading science, spacing algorithms or financial analysis.

Ryan Maelhorn's picture

I wonder if anybody would be willing to reveal how many licenses they sell at which prices?

Of course there is more the font consumer is attracted to then pure price. How much they actually like the font surely plays a big role. But I would bet they would buy a font they pretty much like for $20 before they would buy a font they absolutely love for $200. Unless they are using "house money" as we used to call it in my stock trading days. That is, if they are given a budget by their employer and are not spending their own cash.

I believe there must be a critical mass price point in this market. Just not sure what it might be.... $20? $30? 5$

Nick Shinn's picture

Unless you do a “split run”—i.e. selling the same product with different advertising/pricing to equal segments of the same market—then you have no way of telling how a variable such as price is affecting sales.

With multiple distributors, the same price point will produce different results. Some cater to customers with more “house money”, presumably, among other factors.

Complicating matters further, any optimum price point will vary according to the features and language support of a font.

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