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In the last photo of a slideshow of the 69th anniversary of Hiroshima bombing, there's a description of the photo, plus what I assume is metadata-ish content (emphasis added):

U.S. Ambassador to Japan Caroline Kennedy attends a ceremony at the Hiroshima Peace Memorial Park in Hiroshima, western Japan, Wednesday, Aug. 6, 2014. Japan marked the 69th anniversary Wednesday of the atomic bombing of Hiroshima. (AP Photo/Kyodo News) JAPAN OUT, MANDATORY CREDIT

I assume "Mandatory credit" means that any news organization using this photo has to credit the organization that took it. And obviously, the photo was taken in Japan. But what does "out" mean?

Likewise, I can see "China out" in this article featuring a photo taken in China.

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    It's wire service lingo, not general usage, but I'm pretty sure it means that the photo (which, by being distributed by the AP wire service, is generally available for usage) may not be used in Japan (presumably because another agency has distribution rights there). They might also say "ON-LINE OUT", etc. – Jacob Mattison Aug 7 '14 at 14:17
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At a gross level, it means "not to be distributed in Japan"; that is, "Japan is out".

Background: the Associated Press is a news agency whose members and subscribers, themselves news organizations (newspapers, TV stations, radio, etc) both contribute news to and consume news from the AP; this aggregated feed of news is known as "the wire".

Generally speaking, paying members and subscribers of the AP are permitted to distribute news that comes across the wire to their local audience, unless otherwise specified. Here, "JAPAN OUT" is an example of "otherwise specified".

So an AP member or subscriber in Japan may not distribute that photo unless he calls his local AP office and negotiates a specific deal to do so, meaning he will have to pay an additional fee for the express permission to distribute the photo in question to his Japanese audience.

By the way, such strictures are not limited to the form "[COUNTRY] OUT"; you'll also see phrases like "TV OUT", "MAGS OUT", "NO INTERNET", "NO SALES", etc.

As for the reason, here's a brief explanation from a thread on a site dedicated to AP sports photographers:

Papers also tend to out competitors in their own distribution area so that an NY Times photo that moves on the AP wire will not show up on the front of the Daily News and compete on the newsstand for that point-of-purchase sale.

Note the use of out as a verb (meaning "exclude" or "kick out").

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