I'm using a photo I found on Flickr that is licensed with the Creative Commons non-commercial attribution license. I'm modifying this photo and then will be giving it as a present to a friend. Does anyone know if I still need to attribute the photo? How about if I do it verbally?
For a photobook, I'd consider the best solution would be to add a credits section on the last page, or on the book flap. Morally, that respects the spirit of the licence, and since it's a private use, I wouldn't be too concerned about the legal side of things.
Something along the lines of "Thanks to So and So, who provided the original photograph on which image on page 5 is based (link to flick page)" would be just perfect.
You do need to give attribution any time you create a copy of it (even if you have modified it yourself).
What if you write an attribution on the back (and give attribution verbally)? That way, if your friend forgets where you said you found it, he/she can look on the back of the photo to find out.
As others have suggested, your best bet is to contact the person who took the picture, and ask how he/she would prefer you attribute it. I am going to guess that most people who post photos on Flickr under a Creative Commons license are going to be thrilled that you like their work and want to use it, and will be very reasonable with coming up with an attribution scheme that fits aesthetically in your photo book.
If you want to really avoid issues, be they moral or legal; your best bet is to seek advice from the rights holder (i.e. the person who took the photograph) - They may be willing to licence it to you with different terms, or advise what options they'd see as acceptable for the attribution (If it were me, and I'd released a photo under those terms, I'd accept a note on a credits page, for a photo book; For a newspaper, I'd want it as a caption)
The Creative Commons Attribution Noncommercial License (version 2.5) states quite clearly:
Attribution — You must attribute the work in the manner specified by the author or licensor (but not in any way that suggests that they endorse you or your use of the work).
So to comply to the letter of the license you must contact the author (if they have not made clear how they would like the work attributed). Hopefully they will be reasonable!
You do not need to contact the rights holder to exercise the CC licence terms. The author might specify how they want their credit worded, and what URL they would like referencing, but in the absence of that you can use your judgement - use their Flickr username and the URL of the photo page.
You simply need to provide attribution in a manner appropriate to the medium. For a framed photo for a friend, a caption on the back of the frame would be fine. If you were exhibiting in a gallery, a more visible caption would be appropriate.