The first change is that Steven Murphy comes from the media business. Until last year, Murphy ran Rodale, the family-owned magazine and book publishing empire based in rural Pennsylvania. There Murphy was instrumental in helping the family remake the business. When he left, the family took direct control of the company.
Assuming that Murphy’s media experience is a tell for Artemis’s future plans is probably a mistake. It seems likely that Murphy has been hired more because of his experience in helping a private company remake a business. Christie’s is very much a business that is governed by the somewhat different rules of private ownership.
Secondly, it has often been discussed that Pinault would like to see Christie’s generate a better return on Artemis’s investment. Though the company’s numbers are not released, the overall pattern of the art market these last several years has forced both auction houses to generate their best profits from guarantees on the top lots. When that business ended because of the credit collapse in September 2008, Christie’s and Sotheby’s were both forced to dramatically cut costs, increase private sales and wonder where the future global art market would lie. For nearly a year, there were sustained fears that the art market would like dormant for several years as it had in the early 1990s after the last art boom. To the surprise of almost everyone, the art market has proved resilient, especially at the top.
Now well into what looks like a sustained recovery, Artemis would have a hard time looking at Christie’s with the expectation that growth can and will resume in the core business. So Murphy’s arrival suggests another round of trying to transform the auction house into something broader.
Several art buyers have already expressed concern that there will be a general blood letting and chaos at the Christie’s over the next few months. But it’s telling Edward Dolman will remain with the company. Artemis may need him there while Murphy learns the auction business. Or they might have needed to give Murphy the CEO title to satisfy him but expect him to work somewhere else in the business. Murphy has already told Lindsay Pollock that he plans to concentrate on growth in Asia and “developing other means of selling,” as Pollock paraphrases him.
Whatever his goals, the appointment opens the possibility for a possible truce between Sotheby’s and Christie’s in some of the more destructive competition for property and market share in the US and UK. The fight for a leg up in the so-called emerging markets will probably heat up though in Asia the playing field is larger and wider with many more competitors.
With the popularity of third-party guarantees and Christie’s renewed search for an evolutionary path to growth, Murphy’s appointment could mark a turning point in the expansion of the global art trade.
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