8 Highly Specific Predictions For The Art Industry In 2023 (Including An ArtFair Death Foretold)

8 Highly Specific Predictions For The Art Industry In 2023 (Including An ArtFair Death Foretold)

Every week, Artnet News brings you the gray market. The column summarizes the past week and provides unprecedented insight into how the art industry works throughout the process.

Another journey around the sun begins with the tradition of the gray market.

Longtime readers already know the principle: Each year I dedicate the first column of a series of predictions about various sectors of the crazy industry, all of which can be proven right or wrong by December. I then used the last column of the year to rate myself, including some notes about whether I was right or wrong in each case. (Here's my 2022 report card in case you missed it.)

Ok, enough explanations. Well, let's continue…

1. One or more large galleries set up a department specializing in merchandising licensing and brands.

I don't have the data to back it up, but I'd argue that one of the fastest growing parts of the art economy over the past 10 years is licensing deals with artists and property owners, especially artists' brands. . Product. Repeat the result

Today, many if not all major league retailers operate with the gift shop equivalent of a museum. (Hagassian opened a second freestanding store in London last year.) States runs a merchandise empire offering everything from 3 postcards to $75 alpaca blankets and $1,300 purses at Jean's "King's Pleasure" exhibit -Michel Basquiat from last year in New York . The artists serve each year as inspiration and collaborators for the brightest names in fashion .

However, galleries can remain in competition for licenses. Basquiat Plantation works with independent consultants in this area. My colleague Katya Kazakina reported last year that the Warhol Foundation and the Artists' Rights Association have multiple licensing divisions and that the latter is " building a bridge between artists, artifacts and show business in Las Vegas with conglomerates like Disney and HBO". agencies (CAA, Endeavor and UTA) have hired professionals to work with contemporary artists on transmedia opportunities and licensing deals.

Big galleries (even boutique ones) usually see everything as a sideline worth nothing but limited bandwidth, but will they survive as the licensing pie gets bigger and juicier? Potential profits aside, are some of their more bankable artists content to influence how outsiders spend their time, career, and fame? Or at the very least, will the gallery staff work with their own licensing specialists to scratch this increasingly interesting itch so it doesn't go elsewhere?

In 2023, I suspect the latter will be a yes.

Like the Big Ben renovation, Brexit is coming. Photo by Justin Tallis/AFP via Getty Images.

Like the Big Ben renovation, Brexit is coming. Photo by Justin Tallis/AFP via Getty Images.

2. Art auctions in China and England from January 1 to December 1 will be reduced by at least five percent annually.

From a macro perspective, the US economy remains very buoyant. High ( but subdued) inflation, 15-year high interest rates (with more to come), and the first honest bear market in equities since the Great Depression* have done little to dampen the hiring frenzy. The market and wages are increasing.

(*Technically, the last bear market in the US was in mid-February 2020 as Covid spread globally. But the dip only lasted 33 days and stocks hit two-year highs since the end of March.)

In China and Britain the picture is light and dark. After Xi Jinping abruptly reversed his famous three-year "zero COVID" policy in December, coronavirus infections have exploded and a troubled domestic property market has gripped the country, according to a Hong Kong-based consultancy. A Slow Financial Crisis .

Britain, meanwhile, appears to be in a state of flux after years of political indifference and the toxic heyday of Brexit . But don't take my word for it : "a majority" of the 101 economists who responded to a recent Financial Times poll predicted the UK would face "one of the worst recessions and weakest recoveries " of the G7 by 2023 .

None of this is good news for the global art market. At the same time, for China and Britain, this is worse news than Uncle Sam. Rather than attempting to predict the impact of this headwind on the art auction economy as a whole, I will focus on the biggest casualties. (One of my New Year's resolutions is to lose a little more weight.)

External photo © Axel Depuex.

From left to right: Arne Glimcher, Bill Acquavello, Larry Gagosian and Mark Glimcher. Photo © Axel Depuex.

3. AGP (a combination of Acquavella, Gagosian and Pace) wins the auction house for at least one banknote collection.

Remember when these three big galleries sold Donald Maron's property for $450 million in February 2020 ? Remember how Pace founder Arne Glimscher later told The Wall Street Journal that the partnership was created as an independent entity to try to bid for more valuable collections in the future? Remember how collectors tend to turn to the private market after game auctions stop consistently returning more trophy lots than expected?

While Christie's, Sotheby's, and Phillips were among the top bidders in 2022, many of the big prices I saw were lots over $10 million that either exceeded their estimates or found no takers. In a shaky economic picture, this trend could make the big houses more conservative with the guarantees they will offer to exporters next year.

That, coupled with the greater freedom of a private sale, could create enough room for AGP to play disruptor again. Glimcher, Gagosian, or Acquavella still need an unusually strong connection to the sender, as does Marron. But the ingredients are already there.

4. FIAC will be definitively closed.

FIAC's parent company, RX France, has remained silent following its warm welcome to Paris+ at FIAC's former headquarters and program last October. More than a good turnover and the usual lucky suspects of international art, the most ominous sign for the future of FIAC is the presence of the French political and cultural elite at Art Basel. The celebration was joined by President Emmanuel Macron, Rome's Culture Minister Abdul Mack, Louvre director Laurence de Carré and others. It must have been a major setback for the French RX authorities, who were trying to bail out internal FIAC after the Swiss firm's sudden sacking. Part of the national motto for all " brotherhood "…

A large number also oppose IFCA. Paris+ welcomed 156 exhibitors in its hastily organized first edition. For each new exhibition, it is customary to increase this indicator by 10-15 percent in the second issue. Posh , however, hosts 60 other retailers at the prestigious Paris International Exhibition with Paris+ and is expected to maintain something close to that group in 2023, if not more. Together, these two trade shows can accommodate around 230 exhibitors, ranging from high-end to high-end.

Is a quality gallery enough to bring FIAC back to life in a year of cost cutting? Not happy to say I doubt it.

It's also not encouraging that instead of hiring or appointing a full-time director to oversee FIAC's future, RX France nearly a year ago appointed the director of another exhibition brand, Paris Photo, to manage the two events . I automatically get suspicious when a CEO has to pull double duty. At the same time, in 2022, both are managing art exhibitions, and the main management's performance is worse. If FIAC is AWOL again this year, I don't think so. come back again

Edgar's Plan, My Little Monster Loves Balloons (2020). Image courtesy of Philips.

Edgar's Plan, My Little Monster Loves Balloons (2020). Image courtesy of Philips.

5 . From January to June, total auction sales of ultramodern artists (born in 2019 or later) decreased year-on-year for the first time since 2019.

In summary, the good macroeconomic news is that US inflation is – still – modestly declining. But interest rates are at their highest level in decades, which is a major factor in the decline. To make matters worse, the Fed expects further interest rate hikes in the coming months, a significant reversal from 2010 to last year, when they publicly assured they would keep interest rates at or near zero.

If you have investment grade on paper, that's a nice change. Higher interest rates mean all types of capital goods get more expensive, which theoretically means everyone gets richer. But that's no good if you want to sell what I call speculative art, or (usually) hope that the works of (usually) young artists whose selling prices skyrocketed during the last bull market stay blue forever. -chips or…or at least activate a quick and profitable flip if you move fast.

I think the importance of low or no interest loans drives the art market in general, especially when it comes to speculative art up for auction. The new interest rate environment should be an ice bath for cold assets across all sectors of the economy. Financial advisor Josh Brown recently had this to say on the Slate Money podcast :

“If a company can borrow at zero interest, they'll do a lot of stupid things with the money. They'll make big acquisitions, they'll pay high prices… and if it's worth zero for 12 years, it's a cartoon. Here's what we saw. Investors do the same. With things that have no chance of making a profit in the foreseeable future. They invest money and they don't care. They buy coins. They speculate in digital art. .. and when that changes, the behavior changes.

The change in attitudes towards interest rates means that behavior will change now and the lag of specialty art won't be limited to NFTs (I'm sure this is what Brown means by "digital art").

He says…

6. Christie's, Sotheby's and Phillips generate at least $1.5 million in primary market sales (excluding NFTs).

This prediction is a paradox, not a contradiction.

Last fall, Sotheby's surprised much of the art world by introducing Artist's Choice, a series of sales in which the house features new works by living artists and their dealers, all of which benefit from a growing market for select artists. . In addition, part of the profit goes to a charity chosen by each artist based on their name.

Shortly thereafter, Christie's announced it would offer six works from Baltimore's Myrtis gallery by black contemporary artists as part of its Sept. 29 "Postwar to Modern" sale as part of a similar program. Both houses moved after Simone de Pury's eponymous auction house held a major auction titled Women: Art in a Time of Chaos in collaboration with a number of artists who define women in demand.

I argued that Sotheby's , Christie's and Phillips have been moving in this direction for a long time (and what they are doing can be compared to high-end auctions in South Korea) . But the choice of artist, in particular, creates more than just a sense of apocalypse elsewhere in the business. ​​​​​​​​As sales of ultramodern art soar in 2023, homes will be strategically weak if they step back from the old line. They have to move forward.

Together, Sotheby's and Christie's generated more than $1 million in premium sales after costs last year, with nearly $920,000 in the first Artist's Choice sale and another $92,000 in partnership with Christie's Galerie Myrtis. While Philips is restricted from resale, a 50% hike seems reasonable from a macro environment.

Statue of Charles Ray on Friday November 18th after a good cleaning. Photo: Anna Sanson.

Statue of Charles Ray on Friday November 18th after a good cleaning. Photo: Anna Sanson.

7 . Climate protesters will undermine one or more of the institutional wisdoms, or worse, seek advocacy dates.

Since this column was published on May 29, 2020, climate protests have targeted 21 different works of art in European museums , including mummies and dinosaur replicas. This latest event will break new lines of concern that will cause pain in the coming year.

In mid-November, two members of the French activist group Dernière Rénovation (The Last Innovation) poured orange paint on the monument to Charles Ray and the Horse (2014) near the Bourse-Pinault collection . In all previous actions, the protesters have chosen to chase artworks protected by glass, or have deliberately touched only the elements surrounding the exhibited artworks (see: handrails, boards, etc.).

After two and a half hours of emergency cleaning, the janitor was able to prevent any real damage to Ray's work. But after targeting truly vulnerable artworks for the first time, French dissidents have launched a massive advertising campaign to make them vulnerable to direct attack. It is a bell that cannot be ignored and signals the least conscientious or most desperate actor to go too far.

8 . The AI ​​image will be the subject of a judicial process, a formal parliamentary inquiry, or both.

The onslaught of artificial intelligence is making our regulatory systems inadequate every day, and nowhere is this more evident than in copyright and intellectual property law. I expect tension in the visual arts to be high this year.

Text-to-image generators like Dal-e, Midjourney, Stable Distribution, and (most recently) Google Image "carry" billions of image files scattered across the web. Interestingly, there are few constraints on what the training inputs can be or what the algorithm can output. Attempts to introduce tougher restrictions have resulted in a backlash from some users , possibly to the detriment of the artist.

The problem is very broad and diverse. Last summer , Zachary Small reported that the popular workout archive contains photos of Jeff Koons, Kerry James Marshall, Cindy Sherman and other popular artists . Business cases are more vulnerable; Greg Rutkowski , head of illustration for video game and fantasy shops, has garnered more requests for at least one text image generator than Picasso, and fans often confuse the result with the original work.

Another forum sparked outrage after the artist's signature appeared on an image created by an algorithm . Mass protests and boycott calls are on the rise. The whole situation was spiraling out of control.

While some legal experts say winning the court case against AI imagers will be an uphill battle, there's enough anger and uncertainty to encourage some to try. I like the prosecutions of dozens of unknown artists. Legislative antennae are also picking up on the issue, especially in Europe, where tech companies are for-profit enterprises that have existed long before America's tech conflict. If all of the developers of the algorithm are lucky enough to avoid prosecution, I hope at least one of them is sued or told he's the subject of a government investigation.

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January 2023 – Monthly Forecast for All Rising Signs – A great start to the new year

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