Digitizing Art?

Cindy Charleston Rosenberg, ISA CAPP and current president of the International Society of Appraisers sent me an interesting Bloomberg Business article on a new website which will attempt to digitize, track and even authenticate pieces of art.  The art will consist of fine art, prints, multiples, and books. The site will use blockchain technology to track and document pieces of art. The concern over blockchain technology is the enormous amount of data collecting and which would need to be collected in the future and will enough important galleries, auctions and collectors participate and include info.  Bear in mind, there are many collectors who prefer anonymity.

Technology is again having a potentially significant impact on fine art markets.

Bloomberg reports

Is it possible to digitize and verify every art object ever made? Verisart, a new site co-founded by Robert Norton, previously chief executive officer of two online art-commerce sites, Saatchi Online and Sedition, is going to try.

The digital startup hopes to chronicle original artworks, prints, multiples, and books by using block chain, thereby assigning each object a (hopefully) unassailable certificate of authenticity. Each object’s provenance, in turn, is created step-by-step by its owners, who add their e-mail addresses to an object’s data when they purchase one. In the project’s second phase, down the road, Norton plans to catalogue older artwork by extending the verification service to online sites and artists’ estates. Eventually, he hopes to work with appraisers and insurers to add works that have already been validated.

First, though, the plan is for artists to use image identification software provided by Verisart, which is based in L.A. and will launch in late September, to add art to the database as they produce it. Along with the information you’d get from a brick-and-mortar gallery (artist, title, year, materials), the artwork’s “signature” will also include price information and metadata that will allow artwork to be catalogued and searched by collectors and easily ingested by museums. “I’ve spoken to successful artists, and they all have some form of database management,” says Norton. “At the end of the day, they want some definitive control of their output, and this potentially empowers them.”

This could be a potential boon for creators. Many artists have voiced frustration over the fact that they have no idea who owns their art, let alone where it is on the planet. The art market—rife with opportunities for fakes and forgeries and theft—desperately needs airtight authentication methodology. An easily accessible, readily identifiable process that verifies an artwork's authenticity would benefit both artists and collectors in equal measure.

Verisart's model plans to eliminate questions of authenticity and ownership through a real-time verification process. (Pictured: Gerhard Richter, "Abstraktes Bild," 1990 via Christie's)

Norton, who recently announced that his company has received backing from Rhodium, an Israeli venture capital firm, plans to use the tool for an even bigger goal. He wants to create a Verisart-authenticated database that is shoppable. Using it, anyone could search for an artist or artwork, find images, price history, and provenance, and then—if the present owner of the artwork has opted in—contact them to purchase the artwork.

“We think long-term monetization will come through building a verified database of inventory,” he says. “We think that that will enable transactions through Verisart.”

A Few Problems

The first and potentially most damaging roadblock is simple adherence. What makes Verisart a useful (and profitable) tool is the voluntary participation of an artwork’s present owners. Many collectors might choose not to voluntarily add their contact information—and the price they paid for a painting—to a publicly available database for the same reason that you wouldn’t add your name to a list of people who own diamond earrings, bedroom safes, or second homes on Nantucket. It’s a question of discretion and security.

Norton counters that his program will protect participants’ privacy.  “There are sensitivity options that owners of these works will be able to choose,” he says. “The core function of what we’re doing is a decentralized service, but in order to make something useful to the art world, we don’t think it can be entirely so.”

A further potential problem: Verisart presupposes that a broad audience is champing at the bit to buy art online, thereby bypassing traditional such art market business models as galleries and auction houses. That’s not necessarily true. “What’s very clear is that the success of the auction houses over the last 10 years has been in bringing new buyers into the art market who want to—prefer to—be able to buy from Sotheby’s and Christie’s,” says Marion Maneker, founder of ArtMarketMonitor.com, an art industry news website. “Instead of bypassing the art market, new buyers are flocking to its most established elements.”

Breaking Traditional Models

It’s not just collectors. Artists, who depend upon galleries and dealers to promote their work, fund their production, and develop a collector base, are arguably even more reliant on traditional business models than collectors are. Without established artists’ support of—and participation in—the Verisart platform, the site has the danger of becoming a repository for aspirational artists who have yet to (or will never) receive art market attention. “The only people who don’t want to go through the traditional system are those who can’t get in to the traditional system,” argues Maneker.

Norton believes that this rule of thumb doesn’t apply to lower-value art objects. “When people buy editions and multiples, they consider themselves collectors of those artists’ work,” he says. “I don’t think it just needs to be verification of original artworks; editions are a great point of departure.” Paintings by David Hockney have sold for millions, for instance, while a lithograph in an edition of 75 by the artist sold for just $2,156 at Christie’s in London last year. Successful artists, Norton says, can participate on Verisart “if it doesn’t threaten their galleries,” he says. “It becomes a really interesting value addition in the long term.”

In one respect, that’s the problem. The very nature of Verisart means that success won't be discernible until it has been widely adopted. “I don’t underestimate the mammoth task ahead of us for one second,” says Norton. “For sure, there will be a bunch of hurdles to overcome. But as an entrepreneur, that’s what gets you up in the morning.”

Source: Bloomberg Business