Photography is not dead …photography is worth a million dollars

I paraphrase the extravagant title of the recent article published in Newsweek online to highlight a trend in fine art photography that is quite relevant for the photography business, and clearly shows the vibrant market of fine art photography today.

The entire market is soaring. Photographs selling for $1 million are not uncommon. Students leaving art school are using photography more and more as their delivery medium, rather than painting. Collectors are becoming more sophisticated and knowledgeable. The expansion of the market for contemporary photography has enabled AIPAD [Association of International Photography Art Dealers] dealers to promote works that are truly innovative and original- Robert Klein, president of AIPAD

Clearly, the market of fine art photography is exploding, and this has been the trend during the last few years, with photographs now challenging prices of other artistic media like painting.

When Robert Klein was asked by PDN to explain the increase of prices for fine art photography he makes several interesting points:

One reason is because the technology for doing large-scale color prints has improved. Photos by Gusky and others can be done on the same scale as paintings. Large scale photographs are shown alongside paintings and sculpture, so they are reaching audiences that are accustomed to paying hundreds of thousands of dollars.

So, fine art photography is coming to its age, and like with any other trend, once the tipping point is crossed, the market growth tends to be exponential, to the point that collecting and trading fine art photography could become a new vehicle for investment,as it has been the case for other fine art media.

Michael Moses, a professor at New York University’s Stern School of Business, and his colleague Jianping Mei have studied the art market, and together they developed an index of 10,000 works of art that have sold at auction at least two times.

“It looks a lot like a stock market, but it just doesn’t quite have the same trading frequency, art had an 8.5% annual rate of return over the past 10 years, slightly ahead of stocks over the same period. Investing in art tends to reduce risk of a well-diversified portfolio without substantially reducing the return.”- Michael Moses

The Pond-Moonlight, sold for $2,928,000 at Sotheby’s, New York, February 2006. Image from 1904 Edward Steichen

The print above, although interesting and somehow historical as Steichen tried to demonstrate the pictorialism movement which stressed the artistic qualities of an image above its subject [what the hell is the subject of that image?], commanded a price that clearly goes well beyond its artistic merit, and it describes a pricing value that is entirely controlled by the market, and the appetite of collectors with large amounts of money. The auction house says the print first sold for the relatively high price of $75 in 1906. This is an increase of return of $40K for the dollar, not bad.

The annual “Art Market Trends” study published by Artprice.com, a French company that collects auction data and compiles an art price index based on it reveals impressive growth in 2006:

The global fine art market grew 52 percent to $6.4 billion in 2006 with prices close to levels last seen in 1990 and exceeding them in some markets such as the United States. Driven by galloping prices and a whole new generation of rich art collectors, the number of over $1 million sales has taken off. Today’s prices are - in effect - without precedent.

In November of 2006, in a single night, $491 million were auctioned at Christie’s; this is about half a billion dollars changing hands in one single night trading in fine art. And the photography auction market is not being shy neither, with recent auctions few months ago in New York City bringing more than $9 million dollars.

Robert Frank’s “Trolly–New Orleans, 1955″, sold for $623,400 in October 2007

What is indeed interesting is that even with the soaring interest in fine art photography, this media is still shadowed by other art media like painting. According to the report, photography accounted only for 2.2.% of the auction market. It is noteworthy to highlight that about 73% of the fine art auction market is now controlled by two countries, U.S.A and U.K. The Anglo world clearly controls the fine art market in the world today, with London and New York City being the key capitals accounting for most of the volume.

Auction sales turnover in 2006, by fine art category [Art Market Trends]

I wonder what will be the implications of this trend. I imagine that fine art photography will keep growing dramatically in the next few years. Being only 2.2 of the fine art market photography it has still a lot of market share to capture and so the growth can be quite rapid in the coming years. Second, as more high end galleries display photography side-by-side with other fine art media I would expect an evolution in the aesthetics of photography and ways to display this art [framing, mounting, and other forms of displaying images will add a lot of visual aesthetics to the images, and I expect rapid innovation in this area].

Is the current trend opening new possibilities of financial compensation for photographers? Perhaps for some few ones that achieve star status, but for most, probably the current growth of fine art auction market will not bring much benefit. Even the now making a profit is not guaranteed for collectors, as there are no clear rules for pricing in fine art:

You can buy at a gallery the same print for less money that you can buy at an auction. I have a print priced at $4000 that sold at an auction for $40,000. The auction house estimate was $15,000. They used their authority to put that estimate in print and exceeded it because of uneducated buyers. - Robert Klein

How a photographer can break into the fine art market? Like always, this is about knowing what the markets [galleries, curators] are looking for, it is about making the contacts with curators and gallery owners and … of course have talent.

One way to learn and network is to attend Photo Art Exhibits, where many curators, gallery owners and photographers meet, share their work and ideas and basically define the trends in the market. Coming up now in January, is Photo LA, and others annual events that are worthwhile to consider if you like to pursue this market: Photo Miami, Photo London, Photo España, Paris Photo, Photo San Francisco, and others.

Is photography dead? … not by a long shot, we are in an new era of photography, with increased appreciation and valuation of its merit in the fine art community and unlimited creative possibilities driven by the new digital media and unrestricted creativity by current moderns photographers. We are poised to enjoy a good time together in this field.