How Annie got shot

At work, Richard Petty runs a clinic around the corner from London’s Harley Street where he specialises in treating men with sexual and prostate conditions. For relaxation, he collects photographs of women.

Petty is not interested in any photos, only ones of recognisable figures with interesting careers or life stories. Among others, he owns portraits of the actresses Juliet Stevenson and Scarlett Johansson and the artist Tracey Emin. Another, taken in 1909 by Alexander Bassano, a famous society photographer, is of Maud Allan, an exotic dancer and purported mistress of Edward VII whose Salomé dance was declared obscene by the Lord Chamberlain. He started collecting 12 years ago, going to specialist galleries in London and finding photographs that captured his imagination.

“It is not just a matter of fame. I like to know who the woman is and the story behind the image. The best possible image is a vintage print but if that is impossible to find then I get as near as I can. Each one has to be perfection,” he says.

In principle, therefore, he should be a potential customer for Annie Leibovitz, the notoriously perfectionist Vanity Fair photographer whose photos of Hollywood actors and actresses and other figures are among the best-known celebrity images. Her photos of a naked, pregnant Demi Moore and of an equally naked John Lennon hugging Yoko Ono, hours before his killing in 1980, defined their age.

After a 40-year career, starting as a photographer of rock bands on Rolling Stone in 1970, Leibovitz is a celebrity herself. In addition to her work at Vanity Fair, she is hired by companies such as American Express for advertising campaigns. The Queen sat for a Leibovitz portrait in 2007, and the head of BBC One later resigned after a documentary was edited to suggest, incorrectly, that the Queen had walked out of the shoot.

Yet Petty does not intend to acquire a Leibovitz. Not one of the 10 “master sets” of 157 of her prints that have been offered privately at an asking price of more than $3m per set; not even a single photo. “No,” he says firmly. “I nearly bought her portrait of the Queen but then I decided against it. She is obviously well-regarded but it is a distinctively American taste, her style of photography.”

It is only one collector’s view but it is a straw in a wind that has been blowing fiercely against Leibovitz, who is struggling to repair her finances, having built up multi-million-dollar debts amid a tangle of personal, professional and property troubles. The woes of one of the world’s highest-paid photographers have mesmerised the media and the art world.

Her troubles emerged publicly a year ago when she was sued by Art Capital, a New York firm that lent her $24m against collateral including her three houses in Greenwich Village and her photographic portfolio. The suit, which she described at the time as “harassment” and was subsequently settled, claimed the right to enter her homes to appraise assets that could be sold to repay the debt.

Leibovitz had been introduced to Art Capital by Ken Starr, a financial adviser whose clients included Hollywood celebrities such as Al Pacino, Sylvester Stallone and Martin Scorsese. Starr is now in jail and has pleaded guilty to diverting tens of millions of dollars from his clients’ accounts to his own. Last April, Leibovitz was bought out of the Art Capital arrangement by Colony Capital, a Californian private equity fund, giving her a breathing space.

The Leibovitz story, however, is more than a tale of a photographer who got absorbed into the high-spending world of the people she portrays. It is a reflection of something unexpected – that, despite all her celebrity and talent, Leibovitz lacks earning power as an artist.

If she could sell her prints in galleries or at auction for as much as former fashion and society photographers such as Herb Ritts, Bettina Rheims and Richard Avedon – let alone contemporary artists who work in photography, such as Cindy Sherman, Richard Prince, Andreas Gursky and Gilbert & George – her financial worries would ease.

So far, she has not. The most that one of her photographs has fetched at public auction, according to Artnet, the online auction house, is £31,200. That was paid in 2005 for a signed print of a 1986 photograph of the (now dead) artist Keith Haring, naked and daubed with paint. Most of her prints auctioned this year have fetched in the single-figure thousands of dollars, and some in the hundreds.

It is plenty by most photographers’ standards but works by Sherman, Prince and Gursky have fetched more than $2m ($3m in the latter two cases). Meanwhile, a print of Avedon’s 1957 portrait of Marilyn Monroe sold for $457,000 at Sotheby’s in 2008, and a black and white print of a 1950 Vogue cover by Irving Penn sold for $481,000 at Christie’s the same year.

“To be honest, the market for her work has never been particularly strong,” says Josh Holdeman, director of photography for Christie’s in New York. “A lot of her photographs have been on the cover of magazines but there hasn’t been any deep collecting base for her work.”

Marisa Cardinale, an adviser hired by Leibovitz to sort out her portfolio and work with dealers and galleries to remedy that, says it reflects her lack of focus in the past. “There is a disparity between Annie’s importance as a photographer and the price fetched by her work in the art market. That was not where she focused her talent and intelligence, until now.”

Even Leibovitz’s doubters, of whom there are many in the gallery and auction world, do not dispute that she is a fine photographer – although some complain at her increased use of digital technology to smooth and manipulate photos. “I don’t think her problems relate to her photography at all. She is very good at what she does,” says Michael Hoppen, a London gallery owner.

The problem is that, as Jeffrey Boloten, a managing director of the ArtInsight consultancy in London, puts it: “You do have to play by the art market rules.” That means working closely with auction houses and galleries and doing what they tell you, from making small limited editions of your prints to signing and marketing them adeptly.

Leibovitz has failed this test, at least until she got into her current straits, and her credibility among the movers, shakers and brokers of the art world is low. “She had very little interest in the art world for most of her career,” says Edwynn Houk, a gallery owner in New York who used to represent her. “She suffered from not caring about it, not paying enough attention.”

Leibovitz, who would not be interviewed for this article, tacitly concedes the accusation. In a statement, she said: “I’ve always cared more about taking pictures than about the art market. But for some time now we have closely controlled the editioned prints and we are building a network of relationships with dealers and galleries.”

Her change of heart says something about the photography market itself – its sense of having had to struggle to be taken seriously, to be categorised as art in the same way as painting or sculpture. “That has been a concerted effort on everyone’s part, a dedicated campaign to transcend the photography market and enter the bigger one where more money is available,” says Boloten.

The unspoken fear is that, unless everyone pulls together, this three-decade effort could falter, an effort that has done more for the value of photography than any individual – even Annie Leibovitz.

When Edward Steichen, a painter and pioneer of artistic photography, was hired as chief photographer of Condé Nast magazines and started work on its flagship titles Vogue and Vanity Fair in 1922, he crossed a border. Burning all his canvases, he declared: “Art for art’s sake is dead, if it ever lived.”

At Vanity Fair, Steichen took some of the most memorable – and valuable – celebrity photos in history. His shadowy portraits of Noël Coward, George Gershwin and Gary Cooper are highly sought-after, and a silver gelatin print of his 1924 shot of the lace-covered face of Gloria Swanson, the silent film star, was auctioned for $540,000 by Phillips de Pury in New York in 2007.

His artistic reputation suffered from his defection to the world of commercial photography. “People thought it was unforgivable to work at a magazine, although I don’t think he cared,” says Anne Kennedy, co-founder of Art + Commerce, a New York agency that used to represent Leibovitz and has fashion photographers including Patrick Demarchelier and Steven Meisel on its books.

Steichen was eventually forgiven, though, and became director of photography at the Museum of Modern Art in New York in 1947. The example he set, of moving between magazine and art photography, was later followed by others including Irving Penn, who worked for Vogue, and Diane Arbus, who worked for Harper’s Bazaar.

But that border remained hard to cross. Art + Commerce was founded in the early 1980s to get commissions for artistic photographers such as Robert Mapplethorpe so that they could support their creative work. “I’d been a dealer and I was regarded as a philistine because I was intrigued at the work that was being done commercially,” says Kennedy.

The division between specialist photography and contemporary art using photography still exists, with art photography fetching far higher prices. According to ArtTactic, the average price fetched by photographs in the big auction houses’ contemporary art evening sales last year was $259,300. The average for works in their specialist photography sales – less prestigious events held during the day instead of the evening – was $12,100. But the prestige gap has eroded, as more art museums have mounted photography exhibitions and collectors’ tastes have broadened. “Take Avedon,” says Holdeman. “Technically, he’s on the photography side but it would be unusual for a collector of his work not to own paintings and sculpture as well.”

The art world has accepted the work of some photojournalists including Luc Delahaye, who left Magnum, the legendary photo agency co-founded in 1947 by Henri Cartier-Bresson, to forge a career as an artist. Magnum itself sold 185,000 of its vintage press prints last year to MSD Capital, a fund founded by Michael Dell (of Dell Computers) in a deal valued at $100m.

The gap has also been bridged from the artistic side. Andy Warhol pioneered the use of commercial images such as Campbell’s Soup cans and celebrities such as Marilyn Monroe in his art. He has been followed by Richard Prince, whose print of a cowboy galloping across a landscape, which he re-photographed from a Marlboro advertising shoot, sold at Christie’s in 2005 for a then-record $1.25m.

Michael Wilson, a producer of the James Bond films, owns one of the largest private collections of photography in the world. He says that museums such as Tate, which for years excluded photography from contemporary art exhibits, have now validated it. “Art is basically what a bunch of collectors and curators say it is, there is no getting around that,” he says with a chuckle.

Celebrity images have dominated art for centuries, with painters from Hans Holbein to John Singer Sargent earning their bread and butter through commissions to paint portraits of nobles and high society figures. “Rembrandt was in many ways a celebrity painter but painters were released from that when photography came along,” says Hoppen.

Yet celebrity photography of the kind exemplified by Leibovitz has no automatic claim to be art. “The value of a photograph derives from the artist doing something interesting and exciting and different, not from the fame of its subject,” says Houk. “A photograph of a Hollywood star leaving a nightclub has a place in a magazine but it has no value as art.”

Leibovitz has one great advantage over the paparazzi – access to people who spend much of their lives trying to avoid being photographed. The Queen only gave her 25 minutes but Leibovitz usually demands two days, or at least half-days, of her subjects’ time, and spends hours on the tiniest details. Her subjects open up to her because she gets close and wears them down.

“Access is amazing – the amount of time you are given with someone. When people relax in front of you then all kinds of magic can happen,” says Hoppen. “If you have a day with Brad Pitt then potentially you can take a great photo, whereas if he walks past you in the street and you grab a picture with your phone, it is not going to happen.”

Leibovitz thus has the potential to do what Avedon and Penn did – to become as highly valued as an artist as a commercial photographer. The fact that she has not achieved it, so far at least, is because of something more vital than access, maybe even talent. It is something that has bedevilled the photography world from the technology’s earliest days. She lacks rarity value.

Prices in markets are set by supply and demand and the photography market is no exception. “If all of the stars were to align, you’d have an image that was a cultural product by a photographer who had entered the pantheon of art history and there would only be one print,” says Holdeman.

That hardly ever happens because photographs were made to multiply – the point of the technology is that a negative can be reproduced. “Rarity is essential and it is something that photography does not naturally have,” says Boloten. “You can print thousands of the things and a collector will ask: ‘Why am I paying a lot of money for a print when Picasso only painted one of each?’”

There are at least 1,000 prints in existence of the bellwether photograph of the modern art market, “Moonrise, Hernandez, New Mexico, 1941” by Ansel Adams. Adams only got the chance to take a single haunting photograph of the moon rising over a graveyard, but he continued to make reproductions from the negative throughout his career, until his death in 1984. Dealers, auction houses and collectors have got around the lack of scarcity of “Moonrise” and other prints by ascribing far higher values to what are called “vintage prints” – those reproductions made at the time, or shortly after, the photograph was taken. Standard prints of “Moonrise” sell for about $50,000 while one vintage print, dated to the 1950s or 1960s, sold at Sotheby’s last June for $518,500.

Photographers who are alive present a bigger challenge in terms of scarcity. At 61, Leibovitz has plenty of her career left and she is known as a prodigiously hard worker, constantly adding to her portfolio. Prices for work of photographers such as Ritts and Mapplethorpe increased in the years following their deaths because that placed an unambiguous limit on supply.

Galleries have tried to solve this through editioning – limiting the number of reproductions of a negative to 10 or 15 high-quality signed prints, preferably made just after the photograph was taken. The dealers who represent photographers and have exclusive rights to sell their prints have become experts in curbing the market’s tendency towards over-supply.

“There were huge editions in the 1960s but the market has gone in a totally different direction,” says Alex Novak, a dealer in Pennsylvania. “The vast majority of prints are now made in very limited editions, and that has helped the contemporary market to remain fairly stable. It crashed and burned in past recessions because there were too many prints. ”

Calculating the optimal supply is a fine art in itself, since galleries want there to be enough liquidity for prints of any photo to change hands fairly frequently – which would be impossible if there were only one. Galleries often base their prices on the last recorded auction price and, especially in a rising market, want a recent reference point.

All of this planning over decades to raise the profile of photography and place limits on supply seems to be working. Photography accounts for a tiny proportion of the auction market – 2 per cent of sales in 2009, according to ArtTactic – but it has attracted growing investor interest. There are now several dedicated art funds, including the Tosca Photography Fund and the Art Photography Fund.

Not only did the total value of the contemporary photography market rise by 285 per cent between 1993 and 2008, according to Art Market Research, but it has been more resilient than contemporary art in the post-2008 downturn. “There has been a surprisingly strong comeback this year,” says Novak. “Photography has always been undervalued but it is less undervalued now.”

Yet Leibovitz, who changed galleries several times in recent years, including a spell at Phillips de Pury, has neglected these disciplines. “She is terribly nice but she is her own worst enemy,” says Zelda Cheatle, curator of the Tosca Photography Fund. “If there is a proper collectors’ print, it goes for a lot of money but no-one is sure if others that float around are the real thing or not.”

“We dropped her because it would take six months just to get a print signed,” says Hoppen. “I’ve got one of her prints of Steve Martin sitting here that I hope to get signed soon instead of waiting for months. You have to set aside half a day a month to sign if you are serious about it – that is paid time.”

Cardinale, who has worked with the Robert Mapplethorpe Foundation and other photographers’ estates, denies that there is a problem with past editioning of Leibovitz’s work. “Disorder is not a problem. Her archive is very organised and it is an impressive body of work. It is quite exciting to be in a position to review it and to see the breadth of what she has accomplished.” But, she says, Leibovitz has to buckle down. “The active participation of the artist is of immeasurable importance in the development of a market. She is meeting dealers, discussing possible courses of action and becoming an engaged participant and that in itself is a big step. She is still an artist who loves to take pictures but this will be a priority in her life.”

Although most people in the art world express both admiration and affection for Leibovitz, there is an undercurrent of schadenfreude at the fact that a celebrity who defied the system has been brought low. “She is such a difficult person to work with and it’s always been her way or the highway,” says one photography specialist.

Peter MacGill, whose gallery Pace MacGill in New York represents Avedon, Penn and Robert Frank, says that her work deserves to stand alongside such names. “Annie is one of the important chroniclers of our time and if you execute that craft well, it has sustainable value in people’s hearts and minds and they want to collect it,” he says.

The fact that MacGill is on her side despite all her difficulties is a hopeful sign, for her troubles mirror those of the celebrities she photographs. Like a star who has mistreated and undervalued agents, directors and studios, she neglected the auction houses, dealers and collectors who worked for decades to turn photographs into works of art. Now that she needs them, will they rescue her?

John Gapper is the FT’s chief business commentator

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