Regular readers of my column will note that my last two articles were on the subject of third party grading and its impact on the collectibles market. In my first article, titled “Third Party Grading Part I: The Need Arises,” I discussed how the need for third party grading transformed not only the coin collecting field, but branched out into other collecting markets and brought immediate change. In my second article on the topic, titled “Third Party Grading Part II: Exploring the Myths,” I ventured into controversial territory and worked to dispel some of the top myths surrounding third party grading.
In this final article in my series I provide an actual account of third party grading from the perspective of the comic book collecting field and discuss some of the positive and negative aspects of its presence. While it should be known that I firmly support the need for third party grading in most collectibles markets there are opposing opinions just as strong. It is my sincere hope that some of those who oppose its practice will gain useful insight from this series and others new to its discovery will be better informed. With that being noted we begin our journey sometime at the start of this century.
Sometime in the year 2000 a unique concept was being launched with surprisingly little fanfare that would change the comic book collecting market forever. It was at this time that the Certified Collectibles Group (a major third party grading company) was beginning to certify and grade comic books. Literally within months of the company's launch, comic books graded by the Comics Guaranty Corporation (or CGC as it is commonly known) would start to show up for sale on eBay and other online auction sites. With little advertising and a unique concept, CGC was instrumental in proving that the concept of third party grading could be applied to other kinds of collectibles beyond simple objects like coins and sports cards, but the company was also owned by the same company who operated the coin grading firm NGC (Numismatics Guaranty Corporation), ensuring the company had instant credibility directly from day one. Ironically, CGC would have somewhat humble beginnings, and it would take several years for the concept to permeate through the full collecting community, but by 2003 it was an inevitable juggernaut in the comic book grading field. It was also around this time that collectors started paying what could best be described as insane amounts of money for certain comic books in a high grade that were believed to be scarce. Much like most other third party grading companies, CGC uses a census that shows how many copies were graded and encapsulated within each grade. Since comic books are graded on a ten point scale with the higher number meaning the higher the condition, collectors could see just how many copies of each comic book were graded and recorded. This meant that a speculator market was beginning to appear for any kind of key issue comic book believed to be in a high grade and possibly scarce.
The more and more collectors discovered graded comic books, the more they either loved or disliked them. Speculators were drawn to graded comic books because there now was a way to buy comic books without having to worry if the book in question was restored. While not completely foolproof, CGC employed some of the industry's most respected experts at the time and the restoration check was one of the best services the company had to offer. If a restored comic book was noted it would be placed in a separate color coded holder with all restoration clearly noted on the label. This gave collectors confidence that the comic book they were buying was in fact genuine.
Unfortunately, comic book grading has its fair share of critics. Unlike a coin, a stamp, or a sports card, a comic book is a three dimensional item meant for reading. Opponents of comic book grading assert that once the comic book is encased in any form of tamper evident holder, which is needed to retain certification, it loses all functionality as a comic book and becomes a commodity whose sole purpose is to be bought and sold. Proponents of comic book grading state that anyone can easily open the tamper evident case without damaging the item inside should they so desire. To this day this debate rages on. With well over two and a half million comic books already certified by CGC at present time, it should be obvious that third party grading is here to stay. Unfortunately, getting to this point was not without some controversy.
By the year 2003 some members of the collecting community became skeptical of comic book grading in general because of the rising number of collectors attempting to profit off the system. It was by this time that “pressing” became a very controversial subject within the collecting community. Collectors of other paper based collectibles will note that pressing involves the use of extreme heat and moisture to “press” out any defects a collectible may exhibit in order to obtain a higher grade and thus be valued at a higher dollar amount. Since a third party grading company cannot ascertain if a comic book had been pressed or not, it is not noted on the grading label and the item is not listed as restored even in instances where it may be obvious that pressing had occurred.
Flash forward to the present day - CGC's parent company now operates a subsidy that conserves paper collectibles through the use of pressing, along with other services. The overall collecting market has since moved on from this controversial topic, in some ways due to the fact that CGC continues to dominate the marketplace and collector confidence ensues. Still, this topic does still exist in some context and is still seen as controversial in nature by some collectors and enthusiasts.
With pressing in full swing, it became common for speculators to look for comic books already graded that had the potential to be pressed and resubmitted for grading in hopes of achieving a higher grade. On certain key issue comic books a bump of just one grade level can mean the difference in price of thousands to tens of thousands of dollars in profit. At the same time there is no guarantee that the comic book will be regraded even at the same grade it originally was let alone a higher grade. This has caused naysayers to point out that grading is much more an art than it is a science. Even with the potential for loss there are a growing number of speculators who attempt this feat, and no one can account for any damage that may occur between the original buyers before the item gets to the intended grading company for review.
Today, the CGC serves as a prime example as to how an excellent business plan, along with a leap of faith, can lead to a success. Since the time of its adoption other companies have entered the third party grading market and started to grade collectibles once thought to be too unconventional for certification. Action figures, toys, and video games are all items that can now be certified and graded by various third party grading companies. These companies owe a high level of gratitude to CGC for breaking through the conventional wisdom that only simple objects like coins, stamps, and sports cards can be graded.
In conclusion, whether you are for or against third party grading, one cannot deny the impact it has had on the market. Certified collectibles from across all aspects of the collecting world are setting new records each and every day. Whether it be a rare high grade copy of Detective Comics #27 or a scarce Star Wars prototype, third party grading is here to stay!