Art Market Chess Pieces

March 5, 2016

Art Market Chess Pieces
Organisation of the world art market could be compared to chess upon the condition that bishops could pretend to be rooks, knights could pretend to be queens and pawns could change colour whenever they would like. Chess pieces involved in the artistic processes play the roles assigned to them by the market, while trying to win over the functions of the other pieces. Thus, a collector becomes a dealer, an artist becomes an art consultant, and an art critic becomes a curator. But let’s start with the pawns who dream of working their way out to becoming a queen.
1. Artists
More than 50 thousand artists reside in New York and London. According to evaluations of the year before the last, only 75 of them earn more than a million dollars per year. All the others work to the best of their talent and for much more modest compensations.
Only unknown artists, or, on the opposite, very well-known ones sell their works independently (as Damien Hirst did in 2008, putting up for sale, bypassing his dealer, more than 200 works). The usual practice for an artist is to sell his/her works with the help of a dealer (gallery). The artist and the dealer conclude a contract, under which the artist commits to work with the dealer, and the dealer commits to represent the interests of the artist on the market. Since that moment, the dealer looks for buyers, organises exhibitions, and prints catalogues. The more authoritative the gallery is, the more customers trust the new name. Even though it’s unbecoming, but it often happens that the artist switches the dealer who discovered his/her name to the world, to a bigger dealer, who offers better conditions and richer customers. So, in 2006, Takashi Murakami went to Larry Gagosian, leaving Marianne Boesky, who, in fact, made him a star.
2. Dealers
The mentioned Larry Gagosian is the first who is recalled when hearing the word combination “art-dealer”. He is the owner of 13 galleries on three continents, representing the interests of about eighty artists with millions of revenue. He represents the predatory nature of the art market. There are not many art dealers in the world, working on such a large scale. “Not many” is actually six: Zwirner, Hauser & Wirth, Pace, White Cube galleries, as well as Nahmad and Mugrabi families. Only auction houses are players larger than them. Overall, it is believed that there are about 300 thousand art dealers on the market, of which 90% are small galleries with an annual turnover of less than 1.5 million US dollars.
The larger gallery is, the harder it is for a man from the street to buy the work of a supervised artist. The issue of money is not important here, as it is understandable that you would not have come here without money. But galleries make sure that the works of one artist are distributed evenly around the world, to prevent too many works to be accumulated in the hands of one person, or even in one city. The buyers are often asked to sign an agreement before purchasing not to resell the work within a certain period. And even if in terms of the law the importance of such a piece of paper is zero, once you break the terms of the deal, you will never be able to buy from this gallery again. The world of art sales is based on personal contacts, and this information is distributed instantly. Therefore, if you want to make things right, please refer to an art consultant.
3. Art Consultants
People say that before the end of the XX century the global contemporary art market was so small that sellers knew in person all buyers able to spend more than 5 million US dollars on an artwork. There were about a hundred of them. Now there are more than a thousand such customers, and some of them just some time ago did not know anything about contemporary art. There was a famous story of the purchase of “Dora Maar with Cat” painting by Picasso at Sotheby’s in New York in May 2006, when an unknown man won the auction and paid 95.2 million US dollars for it. Later it became known that it was the first serious art purchase of Georgian billionaire Bidzina Ivanishvili.
Nowadays the passion for contemporary art for a rich man is already considered as something essential, like golf skills. Inviting an art consultant, a person usually puts in front of him/her several tasks: to advise and to teach, as well as to monitor the art market in search of suitable works for the collection. Art consultants visit art fairs and exhibitions, where the customer cannot go due to a lack of time, use established contacts with art dealers to obtain the work of the desired artist, and introduce the client into the small circle of initiates. For such work, he/she received compensation and/or a specified percentage from the purchases. It is interesting that only the names of collectors remain in history as a result. Everyone, I think, are aware of Russian patron Ivan Morozov, whose collection has long been a part of the Hermitage exhibition, but how many people have heard of his art adviser Ambroise Vollard?
4. Museums
Currently, there are slightly more than 200 institutions, which may be called Museums of Modern Art. Some of them are state-owned, other are private. There is even a neologism to describe a museum, open to private collectors: egoseum.
Once museums were the main arbitrators in the art world. Artists admitted to the exhibition at a museum, were considered to have passed the exam and their works to be fit for collecting. Expert assessments of museum curators decided whether an artist could engage in the art, or he/she should think about changing profession. Since then, things have changed somewhat. The art world has found new heroes — those who are willing to offer more money. There is already a lot of very popular artists, who did not pass a mandatory procedure of “approval by exhibition”. They sell their works well without exhibitions. Budgets and state museum funds can no longer compete with the resources of wealthy collectors, auction houses, and leading galleries. Therefore, curators and directors of important museums are increasingly leaving for private institutions, join the ranks of art consultants and international curators. Their incomes are growing, and the market receives professionals of the highest level.
5. Curators
Institute of curatorship has changed a lot in the XXI century. On the one hand, art consultants call themselves curators too. On the other hand, “super-curators” appeared who can impose their will both on customers and on artists. People like Paul Schimmel, Massimiliano Gioni, Hans-Ulrich Obrist are curators of planetary scale, capable of creating exhibitions, carrying the Idea. The concept of curators, bound for life to a single museum, is no longer relevant. However, the critics of “super-curators” complain that their names sometimes overshadow the names of the artists involved in the exhibition. It has already happened more than once with the pavilions of the Venice Biennale.
6. Auctions
There are, according to various estimates, from one and a half to four and a half thousand auctions in the world, which sell artwork. And even people who are far from art know the names of the two main ones: Sotheby’s and Christie’s. They account for 80% of sales of the most expensive works of art in the world. Sotheby’s and Christie’s are companies with multi-billion turnover and all the necessary features of luxury-brands: history, exceptional service, elitism and exclusivity.
Auctions are the natural enemies of art galleries. Once strict rules acted in the wild world of art sales: auctions traded on the secondary market, galleries were active on the primary market, and even large collections were given to galleries for sale, as auctions were not prestigious enough. Everything has changed in the era of globalization. Auctions turned out to be better prepared to attracting new customers in emerging markets in Asia than dealers. Auctions already had their offices in India, China and Russia, as well as the army of employees who were able to convince the “new richmen”.
In 2004, for the first time in the history of auctions, the value of artwork of contemporary artists, sold in one night, reached more than USD 100 million. Francis Outred, the head of the sales department of contemporary at Christie’s, said in an interview to Financial Times that within his lifetime he would see how the work of art will be sold at an auction for USD 1 billion.
Modern auctioneers are earning not only at auctions. Their activities are much more diverse. Now they often serve as art dealers, selling works directly to customers without public auction (it is called private sales), as creditors by lending money to collectors against future sales (as was the case with the collection of Elizabeth Taylor), and even try to open galleries. However, the latter has been unsuccessful so far: when Christie’s bought the respected London gallery Haunch of Venison in 2007, art dealers interpreted this move as an aggressive intervention in their territory, and several artists who cooperated with the gallery, broke their contacts with it. They made it clear for Christie’s: you are intermediaries between the seller and the buyer, and do not dare to go further than that.
7. Art Fairs
Art fair is the answer of art dealers to auctions, the opportunity to collect their scattered forces in one place at one time and to attract spoiled buyers with this variety. If you are rich but busy man, you definitely do not have time to travel around the galleries of the world, but by dedicating one day to visit the art fair of Art Basel, Frieze and Armory Show scale, you get a unique opportunity to see all the interesting and worthy of attention artwork in one place, to compare prices, to get to know the right people, to walk with your art consultant. Here you will meet representatives of all the major auctions, struggling to take the most interesting buyers from art fairs to their territory (usually all the best restaurants in the city are booked just for such operations on these days).
8. Art Critics
Dave Hickey, who is known by the nickname “The Enfant Terrible Of Art Criticism” caustically remarked: “Art editors and critics have turned to court nobility. Everything we do is strolling through the palace and giving advice to very rich people.” Of course, it is a joke, but with a share of truth — it is difficult to remain independent and impartial, surrounded by the people who buy and sell works of art for astronomical sums of money in comparison with the income of a journalist. So, it became rather ordinary to see the transformation of an art critic into an art consultant or a curator.
9. Collectors
They are very moody and demanding people. I know it from my own example. They want everything at once. But I think that people of another character cannot win in our game.

Author: Ignas Jurkonis