The biggest advantage to those who champion
ARR is that so few people really understand it
One of the first issues to be raised in post-Brexit discussions with the art market was the long-running sore of Artist’s Resale Right.
Introduced in two stages (2006: living artists; 2012: artists’ estates for up to 70 years after their death), the combination of charges and red tape made it all but universally unpopular among auctioneers and, especially, dealers.
Artists, the collecting agencies who stood to benefit more than anyone and various others saw it as overdue compensation for those whose work goes on to sell for huge sums without them benefiting further.
The message in brief: Why shouldn’t artists share in the benefits their art brings to others?
Now that the UK is heading for the door, will this law – the result of a European Union harmonisation directive – survive?
Difficult to say, but with everything else on the agenda, scrutiny of it is hardly likely to be a Government priority.
Failing the fairness test
As someone who spent many years campaigning against the introduction and then extension of ARR, I have always believed that it is not only detrimental to the art market, but also to artists. I also think that it fails the fairness test completely in the way it is structured. The problem is that so few people understand its scope and impact that, as with many other measures that should never have made it onto the statute book, they can’t see why art market professionals have any reason to object to it.
Let’s try to clarify that with a few facts:
- ARR has nothing to do with copyright, which is an entirely different right subsisting with the artist for their lifetime and to their heirs for 70 years afterwards.
- It is charged every time a qualifying work resells in the commercial marketplace.
- ARR applies to qualifying works three years after the original sale when the price is the equivalent of €1000 or more and immediately if it is €10,000 or more.
- ARR is not charged as a percentage of profits on an artwork, but as a percentage of the entire price when the art is sold in the commercial marketplace.
- As long as the artist qualifies for ARR and the price is above the qualifying threshold (€1000 or equivalent), the charge applies, even when the seller makes a loss.
- ARR cannot be paid directly to the artist but must pass through one of the two collecting agencies that administer it in the UK, The Design & Artists Collecting Society (DACS) or the Artists Collecting Society (ACS), which each charge 15% of the sum collected in fees, except on overseas sales, for which they make no charge. Originally DACS wanted to charge 25%, but this was reduced in line with the ACS prior to ARR coming into effect in 2006.
- ARR is an inalienable right, which means a qualifying artist cannot opt to waive it, regardless of whether they think it is unfair or risks damaging the market for their work.
- Those involved in the transaction are jointly and severally liable for paying ARR, although in practice the auction houses pass on the charge to the buyer, while only some dealers pass it onto those who buy from them. This means dealers suffer from ‘double dip’ payments – one on buying and one on selling. So a levy across the deal can be as much as 8% of the entire price.
- There is no definitive list of qualifying artists.
- Failure to meet your obligations under ARR rules risks a criminal charge.
- The collecting agencies hold no liability for their mistakes, even if you are the loser as a result.
- If a collecting agency accepts an ARR payment for a transaction that may not qualify, or for which the artist or their heirs cannot be traced, they can keep the money for up to six years before returning it. In doing so, they still charge their 15% fee and keep all the interest accrued.
- ARR is primarily supposed to help poorer artists as they establish their careers. However, the vast bulk of sums collected go to the most successful and richest artists and their estates.
- 30% of all monies distributed go to artists’ estates.
- ARR is capped at €12,500 on any single work of art.
- ARR rates apply as follows: 4% from €1000-50,000; 3% from there up to €200,000; 1% from there up to €350,000; 0.5% from there up to €500,000; and 0.25% above that to the cap. The scale is cumulative, so on artworks selling for more than €500,000, you pay ARR according to the scale of rates up to that point.
- ARR applies to the hammer price for auction sales.
- The UK Government went against its own policy by ‘gold-plating’ the threshold at which ARR should apply. The EU directive stipulated that it did not have to apply under €3000, but the Government went further than that by reducing the threshold to €1000. Originally, the Government had actually campaigned in Europe for the threshold to be raised to €5000.
- Dealers complain as much about the paperwork involved as the fee.
- Failure to comply with the directive and pay ARR meant that many dealers could not show its impact when the UK Government carried out its impact study into ARR at the end of 2013.
- By DACS’ own figures, it has charged over £7m in ARR fees over the past ten years. If its overheads (taking into account other revenues it raises) are lower than this, then it may be not-for-profit, but will certainly be banking a healthy surplus.
- I have never made a penny out of ARR and have no financial or other material advantage in arguing my case.
All of the above is quite a lot to take in. People will argue the fairness of the concept of ARR till the cows come home and still not agree. However, a number of things concern me.
The first is that ARR in the UK has never met the terms of the directive that imposed it on the market. It is not harmonised with other ARR programmes across the EU in terms of thresholds and application. It is not supposed to continue if global harmonisation fails to take place (it has failed and is unlikely ever to take place, as recent events in the US show), yet there appears to be no political will by those who imposed it on the market to meet these terms.
It is not in the interests of the market, which is put at a competitive disadvantage in relation to the other leading global art markets (US, Hong Kong, Switzerland), which have not adopted it.
It acts against the interest of artists trying to establish themselves in the market because dealers are less likely to take a risk in buying collections of their work for resale, giving them a lump sum in the process. Now, most will only sell on commission, allowing fewer artists to rely on this as a source of income.
Most of all, though, I have found that almost no one I talk to about ARR understands it fully and accurately.
Of these, nearly everyone who is not a dealer or auctioneer thinks it is a levy solely on profit. Not one – artists included – thinks that paying it as a percentage of the entire price is fair. No one at all thinks that it is fair that it should be levied even if the transaction makes a loss – not even DACS could come up with an argument for that one when I first asked them about it shortly after its introduction.
A practicable solution that better meets the fairness test
The only argument for these conditions is that it makes it practicable to collect the levy. If you were to charge 4% above €1000 for an artwork where the profit was, say, €100, then ARR would be just €4. From that the collecting agency fee would be €0.60. In this case it would probably cost more to administer and distribute the levy than the sum raised by it.
However, the driving argument by the collecting agencies and the supporters of ARR has always been one of fairness. If fairness trumps all, then make it truly fair. This can be done by raising the threshold to where it should have been in the first place and charging only on profits. The flat rate percentage charged by the collecting agencies allows them to subsidise loss-making distribution activities at the lower end of the scale with the large surpluses made at the top end of the scale, a fitting arrangement for the self-declared not-for-profit organisations.
To my mind, it would also be fairer to poorer, less established artists who might, once more, find a healthy level of patronage among dealers willing to take a risk on them by purchasing collections up front and giving the artists lump sums to work on their next phase. Don’t forget, those same dealers invest considerably in helping boost the artists’ reputations. Successful artists’ reputations are rarely built in isolation, so why would you want to penalise the very people who can make it happen for them.
Do I think anything will change?
Probably not. All I hope is that those who declare ARR a great idea are fully aware of its parameters and potential consequences. I have been looking at them closely for almost 20 years and still can’t see how fairness or common sense applies.
Maggie Laubser’s Birds and Boats is a signed oil on canvas laid down on board measuring 15½ x 19½in (39.5 x 49.5cm), which sold for R1.3m hammer – around £59,000 – against an estimate of R700,000-900,000 at Strauss & Co on March 14.
The art market is a beacon of hope in these troubled times for South Africa, but those who want to be part of the success story need to prepare now
One moment, it was very much a man’s world, the next it is women coming to the fore in the South African art market.
This is the result of the death on Christmas Day of Stephan Welz, the colossus of the country’s art market for the past 30 years and more, and the passing of the baton to the new joint managing directors at Strauss & Co, the country’s leading auction house, Bina Genovese and Vanessa Phillips. Add to their skills, contacts and experience the talents of fine art specialists Ann Palmer and Emma Bedford, and the future vision rests very much on the shoulders of the women in the firm chaired by Elisabeth Bradley.
But back to Welz the man for a moment.
The dominant force for so many years in a way that no other individual can claim to have been in any other art market across the globe, his name added lustre to the works he offered for sale in a way that no one else has ever been able to imitate. The top consignors to auction looked for his personal touch as the magic ingredient, as so often it proved to be.
Such was his competitive spirit that despite ongoing health issues he never lost his edge, even taking R8.5m (£393,520) for the oil and gesso work The Creation of Adam I (1968) by Alexis Preller, the rising star of South African art, in Johannesburg on November 9.
So it was no surprise that the man Strauss & Co described as their “living archive” had two memorial services – one in Johannesburg, the other in Cape Town – and that just about the whole of the South African art market turned out to pay their respects.
Generational change in South Africa’s art scene
Welz’s passing marks not just the end of an era in the terms of his influence. It comes at a time of huge change in the South African art scene as the leading lights of the older generation give way to the new. With that change comes a whole new approach to art and antiques and the way they are marketed. And it all comes as the rand sinks to a new low against sterling amid political uncertainty and the shadow of recession. Five years ago the exchange rate was around 10 rand to the pound; now its sits at around 23.
The mood on the street is negative, as those I talked to in Cape Town and beyond told me at the beginning of February. But strangely, this is not reflected in the art market, where the trade, represented by the South African Antique, Art & Design Association (SAADA) have boosted membership by bringing in the pick of the Contemporary art dealerships to their Cape Town fair with a view to permanent membership of the association.
Having rebranded the association itself in 2013, they moved the fair, now called the SAADA Expo, to The Lookout in the V&A Waterfront last year and packed it out for 2016’s event from February 11-13, no mean feat bearing in mind that it is a considerably larger space than the old venue in the Botanical Gardens.
This was a shrewd move, because the Expo now finds itself right in the centre of the tourist trail for cash-rich evening visitors, who would only be attracted to the botanical gardens during daylight hours.
In turn, the blending of antiques with Contemporary art, and the new policy of marketing traditional objects as pieces of design and sculpture is helping to attract a new and younger domestic audience.
For the Contemporary art galleries, the endorsement of the SAADA brand sets them apart from the mass of other galleries that wouldn’t get past the vetting committee, while the new players help expand the reach and influence of the traditional SAADA membership.
Cape Town and Johannesburg trade adapting their approach
“I no longer market myself as a silver dealer; I sell sculptural artefacts that just happen to be in the form of silver,” says Jeremy Astfalck, former SAADA chairman and owner of The Old Corkscrew, who is the one South African dealer who regularly stands at British fairs (Olympia, LAPADA and the NEC).
“Alongside the Contemporary art this is definitely attracting a younger crowd.”
Some believe that it may also be showing signs of crossing the colour bar. And this is the holy grail for the art market in South Africa: attracting the interest and engagement of the newly prosperous black middle classes who simply do not relate to the traditional collecting fields in South Africa, much of it based on colonial history.
Astfalck, a huge admirer of how his successor at SAADA, Paul Mkrusic, has moved things on, is adamant that taking a new and dynamic approach does not mean compromising where it matters.
“The quality still has to be there for art and objects, including their history.”
He is also finding that his trips to stand at fairs in the UK pay off back home, where contacts he has made turn up at his Franschhoek gallery to make the most of the fabulous exchange rate.
These ‘swallows’, as they are known, because they fly south for winter, have been a staple of the market for years. The trade members among them, from the US, UK and Europe, come to snap up the best of what remains from old family collections for resale at a decent mark-up back home. Although some market watchers, like retired auctioneer Charles Rudd, believe that most of the European heirlooms have already been flushed out from colonial settler families, they still see treasures emerging that make the trip more than worthwhile.
Having closed his own Cape Town auction house in November, Rudd is still very active as an independent valuer and appraiser. Reflecting on the generational shift in the market, he is wistful about the gradual disappearance of the expertise in traditional collecting fields, but says South Africa still has a lot to offer here and believes that many European dealers and collectors are still missing out.
Weak rand attracting buyers to the Cape
“As far as the antiques side is concerned, there are still strong buyers and sellers in the traditional market and I would encourage the international trade to come down,” he says, noting the high level of fresh-to-market items available.
He acknowledges the gap left by Welz but is one of many who warn against writing off Strauss & Co, who, it must be remembered, remain the strongest domestic force in South African art. Also best remembered is that continuity is a strong feature because those now at the helm are not new at all to the company but worked with Welz for years – collectively 48 years, in fact. And they have a record R200m turnover for 2015 to build on. Add to that the strong brand and solid database of clients and their future certainly looks much more positive.
“Contrary to what happened internationally where major auction houses elected to operate only at the top end of the market and are now having to rethink their strategies, Strauss & Co has continued to operate in both the high end and the middle market (this also includes furniture and decorative arts) reaping substantial benefits both ways,” says Genovese.
“The weak rand, along with exceptionally high buyer’s premiums and VAT rates charged, have become a deterrent for local buyers. Conversely, the weak rand is extremely attractive for international buyers that are noticeably on the rise, in particular for decorative arts.”
Strauss are not without their rivals, foremost among them in South Africa itself being Stephan Welz & Co, the company Welz the man sold in 2006 when ill, only to recover his heath and his ambition, which led to the creation of Strauss & Co.
Ironically, despite carrying his name, the firm is still often referred to as Sotheby’s, a legacy of its former incarnation as the auction giant’s South African outpost.
With a new-look website and beefed up media section, as well as a range of specialisms that now includes vintage fashion, its owner Alan Demby clearly has his eye on an even more competitive future, especially now Welz the man is no longer a player.
These two, with Ashbey’s Galleries upping their game on European art but on a smaller scale, are setting the pace domestically.
One thing is for certain: all eyes will be on the next two or three series of sales to see how the rivals perform. The first test has been the March sales in Cape Town, which are still being assessed.
Bonhams continue to dominate international scene
On the international scene, though, Bonhams continue to dominate. It is ten years since Giles Peppiatt established The South African Sale in London and new records for Irma Stern, Vladimir Tretchikoff and others have held sway, even when lesser artists have failed to make their mark.
Here the weak rand is Bonhams’ greatest gift when it comes to consignments: quite simply, they are able to sell them for much more in London than their rivals can in Cape Town, with the caveat that currency rules mean that sellers from South Africa must re-import a hefty slice of the profits.
As for the art itself, Irma Stern and Jacob Hendrik Pierneef have dominated for a long time, but others have been showing strongly in recent years, among them William Kentridge, Alexis Preller, Gerard Sekoto, Maggie Laubser and Stanley Pinker.
“South African artists that should be followed and will in my opinion continue to appreciate are Stanley Pinker, Robert Hodgins and Lucas Sithole,” says Peppiatt. “The one artist who I think that will eventually eclipse all the South African hands is Gerard Sekoto. I would not be surprised if we sell a work by Sekoto for over a £1m in the next ten years.”
Pan-African art the next big shift
The next big shift, though, is likely to be towards the Contemporary artists from South Africa, Nigeria, Ghana and the Cote D’Ivoire, among other African countries, whose work is already being championed by new galleries in Cape Town and Johannesburg.
Africa’s most successful living artist, the Ghanaian El Anatsui, has already crossed over into Western taste. His Gustav Klimt-like bottle-top installations sell for hundreds of thousands of pounds, have won prizes at the Royal Academy and have been on show at the Met in New York and the Venice Biennale.
Events such as 1:54, the Contemporary African art and photography fair that now runs in New York and London each year, are championing new and established African talent, with the art taking on global as well as continental themes, creating mass appeal in their wake.
Names such as Sokari Douglas Camp, a Nigerian in his late fifties, Mali’s Abdoulaye Konaté, in his sixties, and Adeola Olangunju a 29-year-old Nigerian photographer living and working in Lagos, are indicative of the explosion of talent and creativity to be found. This is an unstoppable force.
Names to watch coming out of South Africa itself now include Athi-Patha Ruga, Zander Blom, Michael Taylor and Georgina Gratrix, says Genovese at Strauss.
When the Zeitz Museum of Contemporary Art Africa opens around the end of this year on Cape Town’s Waterfront as the continent’s largest gallery of its type, it should provide a hitherto absent hub for Contemporary African art that has the potential to catapult South Africa onto the international art market, taking it well beyond the modest $35m auction market value it now enjoys to something on an altogether grander scale in a global market valued at around $55 billion. If that happens, those far-sighted enough to be ready for this will be the market leaders of the future. And it will be them, whether galleries, fairs or auction houses, who will also reap the rewards of the new and younger domestic market.
Players line up for market’s next phase
Bonhams, who already hold Contemporary African art sales in London and whose London specialists across several departments can be found in the Cape on a monthly basis, are clearly getting ready for the next phase.
“The growth of Contemporary African art over the past four years has been extraordinary and nominal values have risen by over 200% in some areas,” says Peppiatt.
“In my opinion the art market in South Africa is on the verge of being the key springboard for the larger African market. There has been such growth in Contemporary African art, both from South Africa and further North, and South Africa deserves to be at the forefront of this market.”
He and his colleague Hannah O’Leary keep a close eye on the political scene in South Africa, how the Government and economy are shaping up in that other great African art centre, Nigeria, and how that all plays into the art scene.
“Those lacking a global view are most at risk of missing the boat when it comes to the changing scene in both South Africa and the continent as a whole,” says Peppiatt.
Phillips are now openly preparing to makes moves on the pan-African market and the organisers of the Cape Town Art Fair have clearly taken this message on board too. They moved the event from the Waterfront to the much bigger Cape Town International Convention Centre for its February 19 to 21 run – a bold statement.
Displaying pan-African Contemporary art, its stated aims include showcasing new trends, exposing collectors to new artists and, perhaps most interesting of all, adapting the best international practices to build and sustain an economic platform for the art market.
The challenge for the traditional auction houses and dealers in the country is to make sure they do not miss the chance to join the party when it starts.
Like London, Cape Town has the advantage of being a nice place to do business, which can only add to the mix.
Mortgage rates may be going up and food prices rising, but the art market offers a beacon of hope in these troubled times for the Rainbow Nation.
Human nature means people will always collect, so ignore the
doom mongers who say the antiques market is in a death spiral
COMMENT: Out with old and in with the new. I’m not talking about the turn of the year but antiques, of course. We all know they are finished. Dead. Buried. It must be true because the national newspapers keep telling us that this is the case.
What’s more, they have backed it up with references to John Andrews’ Antique Furniture Index as well as the odd quote from a disgruntled dealer.
I am absolutely certain that this story breaking now could not possibly have anything to do with the time of year or the traditional scrabbling round for holiday season headlines beyond Middle Eastern doom and gloom, domestic flooding or New Year overindulgence.
A slightly closer look at the stories below the headlines tell a slightly different story for antiques, however.
Here the ‘expert’ writers share the amazing revelation that widespread formal dining, along with formal dining rooms with their heavy mahogany furniture, has become a thing of the past. Equally shocking, and something we really all need to let everyone know about, is that people have been turning to IKEA in their droves.
Where have these journalists been since the millennium? Stuck in a Chippendale cupboard?
It’s the news reporting and comment that’s out of date
The Daily Mail tells us that “Shows such as Cash in the Attic have eroded the quality furniture market”, while “Some tables which cost £6000 a decade ago are now only worth £2000”.
It seems to me that the news reporting and comment here is every bit as antiquated and uninformed as the views being espoused.
The fact that run-of-the-mill traditional Georgian and Victorian furniture has suffered greatly over the last 15 years is hardly news. But extrapolating the collapse of the entire antiques market from what has been happening to a corner of the furniture market illustrates the level of expertise being applied here.
Having edited Antiques Trade Gazette, the leading industry newspaper, for 15 years until last year, I have noted one or two things:
- The word antique refers to anything over 100 years old, which means it is an ever-changing market;
- Amazingly, tastes change; and
- Equally amazingly, many markets are cyclical and yesterday’s piece of junk or outmoded collection of antiques sometimes turns out to be tomorrow’s retro must-have.
Janice Turner, writing in The Times on January 2, ironically slightly behind the times herself in arguing that the move is away from antiques towards a cheap throwaway culture even for furniture (hasn’t she heard of the rather more up-to-date upcycling and the return to the BoHo chic distressed look?), says that most people want constant change these days, explaining the popularity of IKEA, and that “even the nicest brown furniture looks like it belongs in a funeral home or a Dickens set”.
I suspect that Janice has never come across nice stuff like the Arts & Crafts Movement and Godwin, or early 20th century giants like Rennie Mackintosh, Gordon Russell and Robert ‘Mouseman’ Thompson. Mostly antiques now and nothing funereal about them. Prices seem ok for sellers, too, so someone’s prepared to pay for it.
Chinese buying bog-standard British antique furniture?!?
And where did she get the idea that the Chinese have developed a taste for bog-standard British brown and are snapping it up as fast as we can ship it out to them?
Tell us the secret to that one and, to paraphrase Del Boy Trotter, next year we’ll all be millionaires, Rodney.
One of the biggest growth areas in recent times has been the revival and development of that most Victorian of obsessions, taxidermy. Now that Hoxton hipsters are seen as rather passé, I await the first stuffed and mounted example on the wall of Shoreditch House or the Groucho Club.
Not that long ago, I found myself looking through the 1928 Olympia antiques fair catalogue. It was not just the black and white photography that looked dated, but much of the heavy Georgian and Regency furniture being promoted in it (most Victorian pieces, at that time, were not yet antique, of course). And it was also not that long ago that fairs like Grosvenor House would vet anything off that was post 1837.
The dealers who do not even know they are part of the antiques trade
Guess what? The antiques trade moved on and discovered the virtues of Victoriana in all its forms. Now they are doing the same with early 20th century design and even, shock, horror, post-War pieces – not even ANTIQUE yet!!
Nor is Art Deco, a trade and collecting favourite for decades.
Sections of the antiques trade are doing badly. Personally, I think it will be a long time, if ever, before the ordinary mahogany bedroom furniture of yesteryear makes a comeback.
But I also think that the great tradition of collecting is here to stay – as the recent Star Wars toys sale at Sotheby’s in New York showed – as is the desire to own great designs and well-crafted pieces.
In my view, the most fascinating aspect of today’s antiques trade is that so many people are utterly unaware that they are part of it. If you have a shop selling vintage clothing, or stand at a weekly market punting fifties and sixties retro chic kitchenware, you are already part of today’s antiques trade.
Great, isn’t it. And have you noticed just how many of the buyers are in their twenties and thirties? Yes, me too.
Give people the chance to see this stuff – and the money to buy it – and they will clear out the flatpacks to make way for it, believe me. Saleroom prices show this now.
As these people start to earn more, and switch on to the thrill of saleroom bidding or visiting fairs and galleries, history shows that they will start to spend at a higher level too.
Technology is also moving on, giving them easier access to what may interest them.
If the trade really were on its last legs, why have so many magazines and websites just published predictions for the year ahead on what is likely to be hot when it comes to the art, antiques and collectables market?
Furnishing trends may be changing because homes are, on the whole, smaller, but it’s a big world out there and people adapt. Key antique statement pieces often form the focus of more modern interiors, and smaller antique collectables still attract buyers in their droves when presented well. Just take a closer look at what’s really going on and you will see.
Too much unsubstantiated propaganda is clouding the issue of looted antiquities and ISIL and diverting attention away from the real problems in Syria and Iraq
I have recently agreed to become a policy and media adviser to the International Association of Dealers in Ancient Art (IADAA) and have been conducting a similar role with the Antiquities Dealers Association in the UK over the past few months.
I am very interested in antiquities and admire the dedication and scholarship of the wider professional community that surrounds them, from dealers and curators to academics.
However, my chief reason for taking on these roles has been to see what I can do to counter the frankly appalling and inflammatory journalism surrounding antiquities that has arisen out of the Syria and Iraq crisis.
A number of pressure groups have sprung up, seemingly from nowhere, that appear to be well funded and run by people of intelligence. However, it also appears that their main purpose is to blacken the name of the legitimate trade in antiquities in a bid to have the entire global trade shut down.
If that is the case, then they are effectively exploiting the Syrian and Iraqi tragedy in the most cynical and disgraceful manner.
Many media outlets have been complicit in this trend, not just giving over column inches and airtime to what is little more than propaganda, but also happily promoting statistics referring to the value of looted antiquities without once checking their source or validity.
In addition, a multitude of claims that recently looted material from Syria and Iraq is on the open market in London gain credence from being promoted as fact in these articles, when the detail shows far less certainty.
How many arrests so far?
I would like to know exactly how much material has been seized in London and shown to be unequivocally recently looted from ISIL controlled areas. I would also like to know how many arrests have been made in connection with this, especially where they have resulted in charges being brought.
So far I have heard of none and do not know anyone else who has been able to quote a single instance.
One recent BBC article, for instance, referred to “a recent container that was seized here in the UK with a great deal of Syrian looted objects on it”. Further investigation has now revealed that no antiquities were present at all, but the story is out there and the damage done.
In the United States, Secretary of State John Kerry offered a $5m reward on September 29 for information that led to the disruption in ISIL’s sale of oil and antiquities.
That was more than two months ago. If the presence of looted antiquities is as widespread in the US as some have argued, why has this reward not been claimed? If it has been, they are keeping the fact quiet.
I have already pointed out, in my earlier blog post, Less box ticking, more research – the survey and statistics crisis, how the bogus $3 billion figure, given as the value of the global trade in looted antiquities, came to prominence.
Articles continue to quote it, while none provides a source for it.
At least one person I have spoken to who is well versed in what has been going on told me that campaigners quote this figure not because they believe it to be true but because it attracts more funding for them if the problem appears bigger than it is.
Exactly who is writing these articles?
Where, it strikes me, media outlets have been equally irresponsible, has been in the lack of clarity surrounding the identity of who is behind many of these articles.
Independent journalists certainly write some of them, but a significant number are the work of campaigners who are self-avowed anti trade.
However, their bylines are presented in the same manner as staff reporters, and while they may add the name of the organisation they work for, I have yet to see a single article that explains what those organisations do.
Because of this, what is effectively the view of a biased pressure group is presented as independent reporting, reinforcing what is often no more than disingenuous propaganda.
Why does all this matter?
Because it diverts attention away from the real problems.
Let’s be clear about this. ISIL/Daesh is a menace and needs to be dealt with. Anyone trading in recently looted antiquities from areas controlled by them or by the Assad regime needs to be stopped and punished.
Let’s be clear, too, that this is also the view of the legitimate trade in London and overseas, none of whom want to be tainted by association with crooks.
The ADA are spending a huge amount of time and effort upgrading not just their code of conduct, but all of their procedures to ensure all members abide by truly robust due diligence and co-operate with the authorities as required. They are playing a very active role in a number of initiatives from Government level down to tackle the crisis, and are also strengthening ties with the hugely under-resourced Scotland Yard Art and Antiques Squad to see how they can support it.
The IADAA have also embarked on a programme of improvements and proactive protection against wrongdoing.
Both associations recognise the seriousness of the threat not just to the legitimate trade globally, but also to world peace. And both have acted immediately, unprompted.
All-Party Parliamentary Group aims to tackle ISIL/antiquities issue
A new All-Party Parliamentary Group to tackle the ISIL/antiquities issue will be chaired by Lord Renfrew, the pre-eminent anti trade campaigner in the UK over the past two decades and more. He will be joined by Lord Inglewood, the President of the British Art Market Federation, and Victoria Borwick, formerly Fairs Director at Olympia and Deputy Mayor of London, and currently Kensington MP, President of the British Antique Dealers Association and self-proclaimed Westminster champion for the art and antiques industry. It seems a fair balance.
Others from the world of curating and academe will also take part in various roles.
This opportunity for co-operation is a real tonic and one that should not be wasted, and neither should a similar initiative just announced for London by its Mayor, Boris Johnson, which will also involve the legitimate trade.
Another longstanding opponent of the trade in antiquities has been Neil Brodie, now a Senior Research Fellow in the Scottish Centre for Crime and Justice Research at the University of Glasgow.
To say that leading members of the legitimate trade have been critics of much of what he has had to say over the years would be putting it mildly.
However, he has just published an article, which, to my mind, is the most measured assessment of the ISIL looted antiquities issue I have read. At last we have someone who takes a cold hard look at the real figures and comes to some surprising conclusions.
It is a must-read.
The wider importance of the trade
To round off, I think it is important for people to understand why having a healthy legitimate antiquities trade is important.
William G Pearlstein puts the case eloquently with regard to the United States in his 2013 White Paper: A proposal to reform US law and policy relating to the International exchange of cultural property. His arguments are equally applicable to the United Kingdom and Europe, and shed light on why Germany will be all the poorer for the ill-advised Cultural Property Protection Act it has just passed. This is what he has to say:
“The stakes are high for U.S. museums, private collectors and the art trade as a whole. The United States has thousands of museums and cultural institutions dedicated to research, conservation, and exhibition of art to the public. Almost all U.S. museums depend on donations of artwork by private individuals and institutions to enrich their collections and make their educational mission possible.
“This object-based philanthropy is made possible only by the existence of a private market.
“Overwhelmingly, the ultimate destination of U.S. private collections is public institutions, which receive these collections through charitable donations or bequests. Under the U.S. system in which private donations are the primary source of funding and accession for public institutions, museums cannot perform their obligations to research, conserve, and exhibit artworks without a vigorous art market.
“This public-private partnership has given the United States the finest museum system in the world; this system is at risk from the hostile U.S. legal environment governing the antiquities trade.
“Also at risk are the characteristically American values on which the CPIA was premised: that global access to art, art preservation and uncensored learning and study about art are in the public interest; that these are facilitated by the lawful international exchange of art and antiquities; that museums, scholars, archaeologists, private collectors, dealers, auction houses, and the general public benefit from cultural policies that facilitate the lawful transfer of art and antiquities; and that U.S. cultural life is harmed by laws and policies that do not.”
How the BBC reported the death of Hugh Scully yesterday.
When Hugh Scully left Antiques Roadshow to launch his online valuations business, it was doomed from the start, as I realised at the press launch
It is 16 years almost to the day since Hugh Scully announced that he was to be the face of Hugh Scully’s World of Antiques, a new online valuations service for internet auction house QXL.com
In what appeared to be an unrivalled coup at the time, the five-year deal was set to net the Antiques Roadshow presenter £3m, made up of an initial payment of £700,000 paid through his production company, Fine Art Productions Ltd, and a further £2.3m profit share, payable on the service’s launch in 2000.
The fact that QXL offered him the chance to take £2m of that money in shares instead of cash illustrates how bullish internet start-ups were as they rode the crest of the first wave of development of what we called the Information Superhighway.
If other plans for the show seemed ambitious at the time, they appear astonishing now, and only serve to illustrate the general naivete of attitudes to the internet in 1999. Scully’s plans included a daily antique auction, collectors’ club and chatroom.
Whether he opted for the shares rather than the cash remains unclear – did they ever reach the 195p option price? – but he was the envy of just about every auctioneer and dealer in the land, and one could only admire his acumen.
However, what was clear to me from the start was that the service simply wouldn’t work.
Food poisoning and the press
It did not augur well when the first of two press launches, held at one of London’s smartest restaurants, ended in mass food poisoning. (It was a reminder, if one was needed, of just how ready investors at the time were to splash the cash, no questions asked.)
Fortunately for me, I had chosen to forego the feast in favour of the second press launch, the next morning, in an internet café on Golden Square. There I spent a couple of minutes interviewing Scully, who was evidently still suffering the effects of the previous night’s debacle and could barely make it through.
It’s astonishing now to recall just how naïve the business model was for the QXL service, but even then it immediately rang alarm bells, especially as it was billed as an all-in-one automatic service, something it plainly wasn’t.
The premise was that those wishing to have objects valued would take a photo, have it processed at a well-known high street store (i.e. Boots) and then email a digital version of the image to QXL who would employ a legion of specialists all over the world to value the item on the basis of the photo.
Quite simply, this was an idea way too ahead of its time, an irony as Scully’s death comes just weeks after Auctionata announced they were buying online valuations service ValueMyStuff.
Three questions which showed Hugh Scully’s project would not work
The answers to three questions I asked Scully that day meant that I left Golden Square certain that the project was doomed. The first was how potential clients got hold of a digitalised image – this was in the age before digital cameras and email saturation.
His answer was that they would take their photo down to a high street shop and have it scanned in before having the digitalised version emailed back to them.
The second question was: Had the deal been done with the high street chain? Answer: Not yet.
The third question sealed its fate in my mind: How much was all this going to cost?
When I added up the initial price of having a film developed – 24 or 36 images printed up at one go was the norm then – the charge by the high street chain of digitalising the image and emailing it to the client, and then the cost of the valuation itself, it struck me that the whole process would come to a minimum of £25 to £30 per client valuation.
Add to this the widespread lack of access to internet services and email, especially among those who had both the objects to value and the money to pay for such a service, as well as all the hassle of taking the photos, visiting the high street, waiting for the email and so on, and it was impossible to see how the service would ever get off the ground, let alone thrive.
If I could work this out in a couple of minutes, surely others would soon arrive at the same conclusion? But it seemed not.
Three months later Scully was billed as a keynote speaker at the first conference on Internet Options for the Auctioneer at Southampton Institute, where most of the industry declared itself still “bewildered and confused”.
Antiques Trade Gazette Internet Handbook advice
At the same time, I was writing a piece for the second Antiques Trade Gazette Internet Handbook entitled Back to the basics of business: Home truths about global communication.
Having trawled through 700 websites to see what worked and what did not, I had my fill of horrors and frustration, concluding: “…however slick the technology, we should not lose sight of the unchanging truth about business success: the technology is the means to an end, not the end in itself. It doesn’t matter how interactive, flashy or colourful your Website, it is the quality of the goods on offer and the quality of the service the customer receives that will determine its long-term prosperity.”
QXL suspended the antiques valuation site 18 months later, a few weeks before 9/11. The deal with Boots had never come through and the public had not proved the eager early adopters QXL anticipated.
Hugh Scully effectively disappeared from our screens. Many other internet start-ups pretty quickly followed suit. They may have failed, but you have to admire their pioneering spirit, even if, in many cases, business sense had been left at the door.
What they did contribute was the development of caution and a more realistic approach to the boundaries of technology when the second wave started. They also did considerable groundwork in software development from which later ventures benefited.
It was reported that Scully had hoped to retain his Roadshow role alongside the new venture, but it was not to be. I only hope that he made enough from the deal in the end to enjoy a fulfilling retirement.
Practices at the top end of the art market lay it open to the risk of manipulation. But it is the culture that allows this to happen that is the biggest threat
COMMENT: Scott Reyburn, an erstwhile colleague of mine and certainly one of the finest writers focusing on the international art market today, creates an imaginary scenario to illustrate the risks of market manipulation in his September 25 post for the International New York Times.
Titled A Tug of War Over Art-Sales Transparency, it brilliantly illustrates the sort of thing that happens at the top, or even top-middle, end of the art market.
The scenario has a fictional dealer grooming a young artist for stardom and then manipulating auction prices to build the legend around him/her with the help of a few friends before cashing in.
While Reyburn remains enigmatic as to whether this sort of manipulation has indeed happened, I do not. I’m quite certain that it is as accurate a picture as can be drawn of some people’s behaviour in the Contemporary art world.
What is particularly interesting about the piece is that although the scenario focuses on the manipulation of an unscrupulous dealer, it is more concerned with the opacity of auctions at the top end.
“Just what exactly is going on when a dealer tops up the bidding on a young artist in whom he has taken an investment position? And are there conflicts of interest when an auction house shares a financial guarantee with a third party?” he asks.
Serious questions indeed, but actually whether there is a conflict of interest or not, whilst hugely important, in my opinion is of secondary significance in the wider debate over competition at the top end of the Contemporary art auction market.
Loss of perspective is what’s really scary
To me, the really scary part is the loss of perspective at the top; the detachment from the real world and what that means.
It’s scary because it is exactly the same sort of loss of perspective that led to the MPs’ expenses scandal at Westminster, the phone hacking crisis among the British national press and, in years gone by, the groping and worse behaviour of 1970s and ‘80s DJs and TV presenters.
Everyone does it and it goes with the territory so that means it’s ok… doesn’t it?
As I wrote in Antiques Trade Gazette last December, in an article entitled Smoke detectors, the essential tool for Christie’s and Sotheby’s in today’s art market, “as far back as 2011 The Economist reported a list of leading dealers as guaranteeing works at auction. It remains unclear whether the trade are guaranteeing works by artists they represent directly or have a clear financial interest in propping up, but if so, then this is surely a step too far along the road of market manipulation.”
As I argued last December, “It might be clever; it might even be legal, but as far as I (and I suspect the man in the street) am concerned, one thing is certain: it isn’t right.”
The fact that this sort of behaviour is seen as acceptable at the top end of the auction market supports my belief that the pressure to perform in such a highly competitive atmosphere has caused decision makers to lose touch with reality.
““Such loss of objective perspective can make one genuinely consider all sorts of practices normal and acceptable, only to discover in the cold light of day, once the party is over, that the rest of the world deems them anything but.”
Act soon or live to regret it
My view remains unchanged, as does my conclusion:
“The test is: would I feel confident attempting to justify my actions in front of a government select committee or the equivalent committee in the Senate or House of Representatives if they decided to review practices within our industry?”
Having moderated the main debate on market regulation at this year’s Art Business Conference, I am not in favour of outside regulation for the art market beyond what we already have. However, Scott Reyburn, along with my fellow moderator Dr Tom Flynn and fellow panelist the art market lawyer Pierre Valentin, are right in taking a shot across the bows of the auction houses as reminder for them to get their act together.
Ivan Macquisten addresses delegates as mediator of the regulation debate at the Art Business Conference in Westminster on September 3. Photo: Bogdan Maran
Law makers, politicians and critics want to bring the art market to heel.
But they are not helping us or themselves in their misguided demands
Art has developed as such a strong alternative asset class in recent years that the debate over direct market regulation has become increasingly heated.
Where money looms large, ethics can play an important part in providing a practical solution in the marketplace for avoiding trouble, building confidence and ensuring stability. Clear standards and the adoption of best practice are essential building blocks towards this goal.
They are particularly important in the international art market because however much the authorities or vested interests might want to legislate, history tells us that comprehensive direct regulation is largely unworkable and serves only to damage markets while failing to prevent crime.
As art market lawyer Pierre Valentin argued at September’s Art Business Conference in Westminster, the establishment of the Conseil des Ventes in 2000 as a regulatory body to oversee the French auction market did nothing to prevent the emergence of the huge corruption scandal among the ‘cols rouges’ porters of the Hôtel Drouot, Paris’s centre for auctions, in 2009.
In the UK, attempts to get to grips with stolen and looted art via the establishment of a centralised Home Office database 15 years ago fell apart because, having backed the plan after much deliberation, the Government refused to finance it, Scotland Yard soon faced other priorities after 9/11 and international co-operation proved more difficult than anticipated.
At a more prosaic level, anti-corruption policy meant that officers across the UK’s police forces assigned to dealing with art theft were reassigned after 18 months in the role – just as they were beginning to establish contacts and develop an understanding of the issues.
History tells us that the political will and financial commitment are just not there
Where was the political will then? And, in reality, where is it now?
Britain is among the top three most successful art markets in the world. Politicians wanting to tinker with that will have to face a number of home truths Valentin also highlighted in the regulation debate:
- Regulators tend to be bureaucrats who lack market knowledge;
- Those in charge of enforcing compliance tend to be poorly paid and resourced, with the result that monitoring standards often reflect this;
- Regulators cannot keep up with the pace of change; and
- The myriad of variations across international borders make it all but impossible for global market regulation to work effectively at a national level.
Much of the unpopularity of the European Commission stems from its image as an all-powerful regulator, answerable to nobody, that inflicts unsuitable business-busting rules on member states in the interests of political expediency and so-called ‘harmonisation’.
Perhaps the most detailed proposal for regulation in recent months has come from Dr Thomas Christ and Claudia von Selle of the Basel Institute of Governance. Their intermediary report of a self-regulation initiative for the art market, entitled Basel Art Trade Guidelines, argued that the current level of regulation and compliance was “insufficient”.
“With some competitors engaged in unethical or illegal behaviour, operating profitably while acting with integrity and ethics is increasingly difficult,” they concluded.
The detailed proposals correctly identified many of the issues that trouble the market, but, as is so often in such reports, set out a structure for governance that was simply impractical in a global market where the vast majority of businesses are fairly small operations.
As with EU bodies, the report’s proposed governing secretariat (run at Basel by, presumably, those compiling the report) carries all the hallmarks of being yet another self-important and costly institution handing down diktats to a world from which it is entirely detached, and all paid for by business whose trade risks grinding to a halt under its aegis.
Where is the understanding of the needs of small businesses? Of the need to act quickly in a fluid marketplace? Of how to oversee effective sanctions? Of realistic appraisal of art market processes and what regulatory interference buyers and sellers would stand for?
The Basel report does have merits, but it appears to take a rather Panglossian approach to the mechanics of its establishment; just how co-operative would business and government be in funding its requirements?
In fact, taken to its conclusion, one wonders how the work of such a governing body would really differ from direct regulation?
What about the ethical dimension?
Dr David Bellingham, Programme Director for the Masters Degree in Art Business at Sotheby’s Institute of Art, launched the Art Business Conference debate on how the art trade can best protect its clients’ interests by looking at ethics.
Firstly, you must decide which ethical philosophy you are concerned with, he argued: Pragmatism, Relativism or Utilitarianism.
Before you dismiss his thoughts as highfalutin’, his point is that one cannot presume to solve a global problem from a narrow Western perspective. It was an original point, and well made.
I would largely call myself a pragmatist, in favour of practical solutions that follow the rule of law. I’m not without a moral compass, but if an uncompromising moral standpoint does not produce a workable proposal, then what is its purpose?
Emerging markets often focus on relativism, setting aside universal and absolute ethical standards in favour of dealing with things as they are in the specific cultural context. It’s a risky approach, though, as oil companies and others have found when falling foul of bribery scandals as they negotiate contracts with officials in Africa and the Far East.
As far as I am concerned, Utilitarianism should play no greater place in the art market than it already does, for instance in blocking the export of cultural objects of outstanding national importance. (Note my use of the word ‘outstanding’.) It’s no good cherrypicking your favourite clauses from the UNESCO Convention. Follow one and follow all or forget it.
You just have to look at what is happening in Germany at the moment to understand the problem. If passed, its Cultural Property Protection Act will force anyone wishing to export a cultural artefact valued at €150,000 or more and that is older than 50 years to secure an export licence.
The folly of Germany’s Cultural Property Protection Act
How does this support the nation’s art market? How do you define a cultural artefact? Who decides on the valuation? Who now will export artworks to Germany for sale? Who, in Germany, will have the incentive to become/remain serious collectors? How will Germany retain the cream of its cultural expertise when lucrative careers in New York, Hong Kong, the Middle East and London beckon that do not tie them up in knots?
If this isn’t the way to kill legitimate commerce, I don’t know what is.
Dr Bellingham concluded his introduction at the Art Business Conference by distinguishing between codes of ethics and codes of conduct/practice. The first are aspirational, the second enforceable.
And here’s the rub. Professions tend to foster professional bodies. They help them burnish their credentials, provide a mediating force for clients and, where effective, separate the wheat from the chaff among the professionals.
The art market is no different and it is clear from the conference debate that most see the various trade and industry associations as being central to any form of self-regulation in both established and emerging markets.
However, as we debated on the day, trade associations have inbuilt weaknesses. They tend to rely on their membership for funding and unless they have impressive cash reserves are understandably loath to diminish their numbers, even in the interests of quality control, except in extremis.
Chucking out a powerful member who might turn on them legally would give anyone pause for thought, but expulsions do, on occasion, take place. Publicising the expulsion is all but unheard of for the same reasons noted above, despite the potential benefit of boosting public confidence in the association by showing that it has teeth.
Likewise, the confidential nature of milder complaints, in which the association plays a successfully mediating role, usually means that it cannot publicise that success.
In short, those who run associations are often caught between a rock and a hard place. They must be seen to be acting in the interests of their members, but also in the interests of the public against their members when necessary. They are expected to demonstrate this publicly while being constrained by confidentiality agreements and the risk of actions for defamation.
An OfArt, like OfCom, might get round these weaknesses, but then you are back with the problems of cost, red tape, interference with legitimate interest and so on.
Nevertheless, I suspect that properly developed, the answer does largely lie with associations and trade bodies. They can filter out the undesirables, they do encourage best practice, set out codes of conduct, support members and their clients in resolving disputes and help boost confidence in the professionalism of those members.
The answer is to create incentives for businesses to behave better
This public service ‘branding’ can be invaluable in helping develop new markets, just as, in China for example, bidders at auction tend to chase classic brand names when buying wine, jewellery and other collectables.
Specific professional qualifications should, in my view, attract preferential treatment when crossing international boundaries, especially into emerging markets that do not yet have the infrastructure for policing their own, as yet undeveloped, set of industry guidelines. Internationally recognised standards in security, packing and shipping should help companies win reduced insurance premiums as well as fast-track processing across borders.
In short, I would like to see more carrot than stick in promoting best practice. There has been far too much of the latter in recent times and, as another speaker at the conference, Robert Hiscox, pointed out, insurers are effective at back-door regulation by refusing cover to the dodgy.
Establish your kitemarks and then show business how it can use them to promote its brands and save money.
Competition in the market is primarily about client service these days. The best way of making ethics work on a global basis in this context – notably in emerging markets – is to make them pay.
David Chipperfield’s new link between the Royal Academy and 6 Burlington Gardens
How the Royal Academy’s new architectural link may well lead to the building of even more important cultural and commercial links
Two parallel worlds suddenly and dramatically linked by an unexpected and hidden doorway. In the case of C.S. Lewis’s The Lion, the Witch and the Wardrobe, Lucy Pevensie first discovers the magical world of Narnia while playing hide and seek, pushing her way through a store of fur coats at the back of a deep wardrobe until she finds herself brushing aside the branches of fir trees and emerging into a snowy landscape.
As of 2018, visitors to the Royal Academy will also be able to make their way from the world of public art through the new link corridor joining the RA’s Burlington House off Piccadilly to 6 Burlington Gardens, the building it acquired in 2001.
In turn, this access will help introduce the art-loving general public more directly to the wonders of a new world many will not have seen before: the art trade in Mayfair, most specifically in Cork Street, which lies just across the road from number 6’s front door.
Even better, the £50m transformation of number 6 includes a 300-seat lecture theatre, a permanent home for Royal Academy Schools students to exhibit their work and more space for contemporary and current exhibitions. The public coming through from Piccadilly will also gain access to one of the best-kept secrets of 6 Burlington Gardens: the Cast corridor.
Making a whole new world of artistic connections
The single most important change is that the Burlington Gardens building will be used a great deal more on a daily basis. As architect Sir David Chipperfield put it, “We’re knocking a hole in the wall. It’s a small amount of architecture for a large amount of result.”
So Royal Academy students will be regular visitors to the building, giving them the opportunity to look across the road to commercial galleries that could soon become their mentors and representatives.
This is very welcome news after the depredations dealers have faced in the Narnian-like perpetual winter of recent years, forced out of galleries they have occupied for decades as the White Witch of luxury brands and property developers has cast her frozen spell.
As Charles Saumarez Smith, the secretary and chief executive of the Royal Academy, told The Guardian: “This is not just a major building development, it is an undertaking which will transform the psychological, as well as the physical, nature of the Academy.”
And just in time for the RA’s 250th birthday.
The Association of Leading Visitor Attractions lists the Royal Academy as having had just under 825,000 visitors for 2014, putting it in 35th place. That was a 19% fall from the 1,015,505 it welcomed in 2013, when it took 26th place, itself a 19% fall from the 1.2 million that brought it 17th place in 2012.
Since then the Houses of Parliament, Kew Gardens, the RHS Wisley and even Glasgow’s Kelvingrove Art Gallery and Museum, among others, have surged passed it, so the revamp and extension come at just the right time to breathe new life into Burlington House and the Royal Academy’s collection and exhibition programme.
Playing the percentage game with the Royal Academy’s visitors
If even 1% of those who pass through its portals – already interested in art by the very fact of their visit – proceed through the link to 6 Burlington Gardens and out the other side, that will mean close to 10,000 people already thinking about the wonders of art entering the magical world of Mayfair and its unrivalled gathering of fine art and antiques businesses. Echoing Charles Saumarez Smith, it will be a psychological transformation for both public and trade.
Not only that. The business potential for all will blossom too. As a public institution, using a fair proportion of its new space to educate artists in their formative years, the new-look Royal Academy will doubtless be looking for support in various guises to help keep its programme fresh and vibrant.
What better opportunity can there be for auction houses and galleries to offer their services and even financial backing in forging new relationships with the Royal Academy and its students? It could even help fill one of the biggest and longest-standing gaps in fine arts degree courses: teaching student artists how to negotiate their way into the commercial market and make a living.
This must surely provide one of the best arguments of all for Westminster Council to press ahead with its Special Policy Area initiative, aimed at protecting the cultural and artistic profile of Mayfair.
The unique juxtaposition of the expanded Royal Academy with the premier art-dealing enclave this side of the Atlantic should also give the Government pause for thought as it brings together the politically attractive possibility of boosting the nation’s culture, business and employment prospects in one fell swoop.
Questionable survey marketing and lazy journalism threaten the media, public debate and the legitimate art and antiques trade
COMMENT: Type in the word ‘survey’ under the Google News search and see what comes up.
I have just done this and found that there are 79.9m results. A significant number of these refer to media reports of new surveys conducted into all aspects of life and business.
Top of page one among the Google results was a Guardian news story on an Amnesty International survey concerning attitudes to the criminal status of abortion in Ireland. It tells us that the findings come from 1000 phone interviews made during May.
So here we have a survey by a named organisation with the reporter giving us at least some idea of its methodology. Not bad, although as Amnesty International is not an independent body but a campaigning organisation, the question arises as to how independent the survey actually was. If Amnesty brought in a professional polling company to conduct the survey on its behalf, the report does not say.
Another story tells of a survey conducted by Car Finance 2 Go, which assesses what annoys motorists the most about each other. It made great copy for The Bath Chronicle and The Gloucester Citizen, but the report gives no details of how independent the poll was nor how it was carried out beyond the Citizen saying over 1000 people took part.
Global software security group Kaspersky Lab conducted a survey among 1000 people into the relationship between smartphone usage and amnesia.
How did this amnesia manifest itself? According to The Express Tribune, stablemate of The International New York Times, “Many adults could not remember important phone numbers of family members and friends. The survey also showed that people are not doing much to protect their information online.”
What’s more, the survey additionally reveals “Less than a third of the people surveyed put security precautions on their devices”.
By happy coincidence pollsters Kaspersky Lab are on hand with the solution. As the home page of their website tells us, they are “the world’s largest privately held cybersecurity company offering endpoint protection solutions to consumers and businesses around the globe”.
Work your way down the Google list and in many cases it’s the same story: product placement posing behind the fig leaf of a ‘survey’ to burnish the findings with some sort of scientific credentials that make it newsworthy.
The increasing frequency of this marketing technique is no accident; it is a symptom of the erosion of proper investigative journalism in the face of plummeting revenues in the traditional publishing sphere, largely brought about by the rise of the internet and free information online.
The good news is that there are still decent journalists out there who will not fall for this junk. The bad news is that there are others who will. The worst news of all is that many of those who do see questionable surveys for what they are still file stories on them because of deadline pressures – they need to fill space and an ever-shrinking set of resources leaves them with little alternative.
A lot of the time none of this matters. And if you run a marketing department, who can blame you for doing a bit of lateral thinking and turning what would otherwise be an advert into rather more powerful editorial?
The problem is that sometimes it really does matter.
TV series promotion
In September 2013, as the then Editor of Antiques Trade Gazette, I conducted an investigation into another so-called survey splashed across a number of UK national newspapers and the Mail Online, now the world’s most visited website.
The UK Fakes and Forgeries Report, as it was referred to in these articles, claimed that 40% of all antiques on the UK market were fakes or forgeries.
On closer view, it appeared that the report’s ‘40% of antiques are fake’ figure had been extrapolated from the finding that 43% of people who buy antiques don’t get them authenticated and that 68% of people who buy antiques are ‘worried’ that they may be fake.
So no evidence at all to support the 40% fakes claim in the survey.
The report coincided with the launch of UKTV Yesterday Channel’s new series of Treasure Detectives.
Needless to say, when I contacted the programme makers they were rather coy about who had actually conducted the survey. Pressed, they admitted that it was actually called The Yesterday UK Fakes and Forgeries Report. So, did they produce it themselves?
When I asked to see a copy of the survey they emailed me the press release that all the other news outlets had swallowed wholesale and regurgitated in screaming headlines.
Even then, the ‘findings’ in the release did not support its own headline – The nation’s love of antiques has led to rise in the number of fakes and forgeries – in any way.
On pressing the TV company again for a copy of the original survey, I was told: “I’m afraid we don’t release the survey data”, before they went on to disclose that the survey was completed by 2000 adults, using a reputable survey company (never named) and then the clincher, “The rest of the report was comment and expertise of Curtis Dowling”, the programme’s presenter, who gained substantial publicity for himself and his new show from the ensuing media storm.
As my later comment piece argued, “Count on it, in a year’s time when the issue of fakes and forgeries is raised again, that statistic will have morphed into hard, authoritative, indisputable fact for the news media – and possibly even Whitehall – to regurgitate, reinforce and beat our industry over the head with once more.”
And I explained that my comment piece would also be posted online in the hope that it would go some way towards diluting that effect of the TV report.
The $3 billion question over the antiquities trade
As my comment piece also mentioned, this method of validating unsubstantiated statistics has form, not least in providing ammunition to attack the legitimate trade in antiquities and at Government level in devising legislation to tackle stolen art and antiques.
This dubious practice persists today and news outlets continue to fall for it, feeding the propaganda in the process. In fact, it has been compounded by the emergence in the past couple of years by news aggregating websites that repurpose other outlets’ content to drive traffic to their own sites.
Lazy journalism is often as much to blame as the deliberate dissemination of questionable material dressed up as scientific findings.
In recent weeks, for instance, I have noticed a number of mentions of the figure of $3 billion as the estimated value of the global antiquities market.
As far as I can see, not one report among those published gives a source for this figure. The Toronto Star publishes it in the sub heading to its report Islamic State cashes in by peddling art loot on eBay, Facebook, and lists it again in the body of the report without attribution. Many of the other articles appear to have been inspired by, or even acknowledge, Bloomberg’s report titled Islamic State is selling looted art online for needed cash.
Bloomberg also quotes the $3 billion figure but again gives no source for it. Artnet news, which aggregates other news sources, put the figure in its headline while quoting Bloomberg.
In fact Bloomberg seems to have sourced its article from The Economist’s June 13 online report Save our stones, which makes no mention of the value of the global art market at all, but does mention the figure of $3 billion. However, it refers to this figure as being the estimated value of Egyptian antiquities lost since the fall of President Hosni Mubarak in 2011, according to Deborah Lehr of American association the Antiquities Coalition.
Have later reports, starting with Bloomberg, confused these figures? I don’t know, but I do know that no one I have consulted has any idea of where the $3 billion figure came from in referring to the value of the global antiquities trade. Antiquities dealers I have spoken to believe the trade is worth far less.
Just to confuse matters further, another online article titled Plundering the past, by David Johnson, states that “A recently released report by the McDonald Institute for Archaeological Research in the University of Cambridge, England, states that up to $3 billion in art and artifacts are stolen each year around the world.”
The Institute’s report is titled Stealing History: The Illicit Trade in Cultural Material, says Johnson.
His article is undated, but ranks at number 3 of the articles on the first page for a Google search under the term ‘$3 billion antiquities’.
A search through the McDonald Institute’s online archive under the report’s title as given by Johnson reveals that it was published in June 2000 and is now out print. Further research reveals one of the authors to be Peter Watson, one of the most outspoken campaigners against the antiquities trade.
Background to illicit trade claims
Eventually, I managed to secure a pdf of the report and in paragraph 1.9 it gives a value for the illicit trade in antiquities as $2 billion, attributing the figure as an estimate by Geraldine Norman and qualifying the claim further by adding: “other estimates have ranged down to $150 million. As already pointed out, because the trade is clandestine, reliable data is hard to find.”
So recently turns out to be 2000 and when checking the report’s own reference to the Geraldine Norman estimate, that came from an article she wrote for The Independent titled Great sale of the century, dated 24 November 1990.
Just to recap then, Johnson has an article ranked 3 on the home page of the relevant section of Google quoting the $3 billion figure as applying to the illicit trade in antiquities and giving the institute’s report as the authoritative source. The institute’s report turns out to be 15 years old and quotes the different figure of $2 billion, which it attributes to a newspaper report by then already ten years old, noting that it was one person’s estimate. It also admits that other estimates put the illicit trade at less than a tenth of that figure and effectively further admits that none of this can be relied on because “reliable data is hard to find”.
We are now left with two claims: that the global trade in antiquities is worth $3 billion and that the global trade in illicit antiquities is worth $3 billion (or $2 billion if, as it seems, Johnson has misquoted the McDonald Institute report.
So what? Why does this matter?
Because, as with the bogus 40% of all antiques are fakes or forgeries claim, in a very short time indeed this figure has become established ‘fact’ and is being used widely in arguments against the antiquities trade. How much time will it take before academics who have long been trying to shut the trade down start to say that if the market has such a value, then the risk of associated crime must be very high and the trade should be bashed once more?
Believe me, they will jump on this one as soon as they can.
Whether it was Disraeli or Twain who coined the phrase lies, damned lies and statistics, my belief is that there has never been more need of reliable and truly independent statistics in the arena of public debate.
Those with an axe to grind can do serious and unjustified damage to legitimate interests by manipulating marketing techniques and taking advantage of poorly resourced media outlets that feed voracious 24/7 newswires.
For their part, reporters and feature writers need to be far more circumspect about the information put before them, especially in these embattled times for journalism, or they risk accelerating the rate at which the media becomes mistrusted and irrelevant.
Fine Art Bourse (F.A.B.) challenge the centuries-old auction model with an innovative fee structure and wave away various add-ons like the Artist’s Resale Right and VAT by bringing the hammer down in Hong Kong.
Simon de Pury launches his new online action model at Ely House, the Dover Street headquarters of Mallett in London’s Mayfair, where stablemate Dreweatts have already christened the building as an auction centre with the Pete Waterman sale… and where Mallett themselves, dealers of 150 years standing, will hold their own inaugural auction on July 7.
Only five days ago, Chicago auction house Leslie Hindman announced the launch of LH Exchange (LHX), a new retail online platform connecting buyers and sellers.
These are just the latest in what is becoming a long line of art market professionals blurring the line between traditional methods of business.
Online auction houses, dealer portals and other routes to market
Where once we had dealers and auctioneers – with never the twain meeting except in the individual world of coins, medals and stamps – now we have a growing range of routes to market, with many offered from the same outlet.
Traditional auction houses, online auction houses, online auction platforms, dealer portals, galleries with websites promoting bricks-and-mortar sales, online-only dealers occasionally exhibiting at fairs, auction houses pursuing private treaty sales, dealers holding occasional auctions… the list goes on. And within these, subtle tweaks to marketing and method of transaction add their own unique twist.
What’s behind it all? Is it a good thing? And what does it mean for the market, especially the buyer and seller?
The answer to the first of these questions is threefold: technology, opportunity and margins. Businesses simply couldn’t adapt successfully in this way even five years ago because even if the idea was there the technology to support it wasn’t. Many an investor and trade professional burnt their fingers 15 years ago when the first phase of internet commerce dazzled them and sound business principles – and plans – were cast aside in the rush to the flame; a case of more heat than light.
Even today there are some highly questionable business models out there, and my guess is that even a few of the best-known names in the market will not survive their ill-thought-out cost structures.
As I have argued before in Antiques Trade Gazette and elsewhere, the glamorous world of high-priced international art auctions grabs the headlines because of the vast sums changing hands, yet cut through the glitz and the profits all but disappear.
The challenges facing Sotheby’s and Christie’s
This is the conundrum facing Sotheby’s and Christie’s as they replace one management team with another. They need to continue cultivating an image of extreme wealth and luxury while – in Sotheby’s case, at least – explaining to their shareholders why they are getting so little in return for their investment.
Fine Art Bourse’s auction house dandies video sets out to challenge the traditional auction house market and disrupt the market as it sets out its new business model.
There are only three ways to go when your cost base is high and your margins are low: cut your costs; find new ways to make money; or do both.
No surprise, then, that the duopoly ensured they got a head start around a decade ago in targeting the private sales market. Although that source of income has dipped in the past few months, in the long term it has mushroomed, explaining the huge investment in gallery exhibition space under the Sotheby’s and Christie’s brands in places such as New York, London and Hong Kong. Together, they are the world’s biggest dealers today, as well as the biggest auctioneers.
Private treaty sales are undoubtedly helping to boost profits for auction houses across the globe, but a safe future means diversifying even more; hence the development of financial services, brand licensing and other money-spinners.
All this means that dealers have to be on their toes too.
Strategic partnership opportunities for Stanley Gibbons Group
The Dreweatts/Bloomsbury/Mallett axis is more than simply a list of diverse brands brought together under the umbrella of the Stanley Gibbons Group. It is the embryo of the sort of strategic partnership that promises to transform the international art and antiques industry as it frees each segment of activity from the restrictions of its traditional metier and capitalises on the talents and assets of its fellow interests.
Handled well, this really does have the potential to be more than the sum of its parts and to maximise value at every point.
Even relatively small dealerships have the opportunity to exploit technology and strategic partnerships with auctioneers and web platforms, realising their full potential in terms of prestige and profits without excessive outlay.
Is all of this change a good thing?
If it leads to innovation, more efficient business practices and more effective financial returns on investment all round, then broadly I would say it must be.
Why do I hesitate slightly? The matter of transparency.
Balancing analysis, transparency and discretion in the art market
As art dealing go online and behind closed doors, it makes it harder to track performance for those trying to analyse the market and it raises the risk of dubious practice as well as suspicion among the public and the authorities.
On the other hand, if auction houses and their charges have been the bane of dealers’ lives for decades, auction price exposure online has joined them in helping to raise the trade’s blood pressure. The extreme candour that the internet has brought to most auction sales reporting has not made it any easier for dealers to negotiate with their clients.
So it is important to strike a balance between acceptable discretion, needed to oil the wheels of commerce, and comprehensive reporting, essential for confidence in, and an accurate view of, the market for those who wish to operate within it. Most importantly, we must not forget the interests of buyers and sellers as we strive to protect those of art market professionals. Many of these new business models, such as Hindman’s LHX platform and F.A.B.’s cut-price fee structure, are clearly customer focused, simplifying the route to market to attract a much wider reach and capture dollars that have so far escaped the tidal wash of the international art, antiques and design market.
Ethics and judgment are key to the future of auction houses and dealers
Taking all of the above into account, I think we also need to relax a little. Dealers will continue to have a beef with auctioneers for all sorts of reasons; auction houses will remain fiercely competitive with each other; special interests in the curatorial and academic worlds will pursue their often curious campaigns against what they see as the unacceptable world of art commerce.
Businesses need to plan properly and temper their ambitions with cool dispassion. They need to assess their activities honestly and objectively to ensure that they behave in an ethically acceptable manner. If they do that, then we should have little to fear from all this innovation and breaking down of barriers.
Some trade professionals believe that clear demarcation between dealers and auctioneers should be sacrosanct, but actually most of the public not only couldn’t care less, but don’t actually understand what that difference is anyway.