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Big News: AGS merging with GIA

DRSAMURAI said:
Paul of JannPaul offers his most recent insights and opinions on the merger:

just an update cause i see alot of speculation on pricescope and this open to be quoted by me, finished my meeting with both labs.

1.) GIA will not be changing their cut grading system, if anyone was wishing for a new lab report that combines the 2, like incorporating the aset into the gia cert/ creating a premium gia cert that's not ever happening and confirmed.
2.) all recertifications, or resubmissions will be fresh as a whole to GIA. if there's any discrepancies found(this opens a huge pandora box) between the 2 labs now, there will be no support given, it'll be up to the retailer to explain to their clients. (sorry my personal opinion is that GIA threw all ex ags clients just under a bus. The team in ags fought to push through as much as possible of their outstanding services over the years, but alot of it was denied
3) past submissions, recertifications, will have to go through the 3 exc. if you were a previous agsl vendor, and need to recertify for your client or your own past diamonds, everything will rerun through the whole new gia system brand new, no subsidy, full charge as a brand new submission no support is given, should you have any discrepancies that's all on you.
4.) all AGSL vendors of the past, knows the lengths AGSL goes for their vendors, cut scans will be sent first to evaluated and studied for the possibility of ideal 0 light performance, agsl will then provide a comprehensive zenith and guide for them if or not and how to make the ags 0 ideal cut grade. this service is entirely terminated.
5.) if you choose to go for the ags ideal light performance report + GIA, and you're speculating that new vendors would jump on this bandwagon, there's is no support given. If say you choose to submit 2000 stones with gia + the new ags submission report, first you'd need to make the gia 3exc grade. there will be no support given from gia nor ags on what will meet the ideal 0 mark anymore. if 1000 stones do not meet the criteria for agsl 0 light performance, you will be reimbursed half of the price of the you paid for the 25$ usd of that 1000 stones(lol). we're talking about just round brilliants alone, forget even fancies. so if you're unfamiliar with the ags ideal 0 metric of the past. you're pretty much gambling.
6) the new ags light report digital really just looks... vendors might as well just take their own aset scope at this point.

this is as much as i'm allowed to say.

read between the lines: that im extremely unhappy with what's going on and all the marketing fluff. the team in AGSL especially their RnD team are fabulous fantastic hard working people, they've had tons of really innovative rnd works they were working on last year that i know of, that could help immensely in transparency and cut innovation for both products and consumer protection, that was all cancelled. Those who has had the honor to work with the rnd team before know that they're extremely passionate people at their work who go far and beyond with the passion of shipley's TRUE vision.
One cannot support a broken system if the broken system is confirmed in place to stay. that's all I can say.

Paul Hung
Ceo of JANNPAUL
Click to expand...
Paul and me have had some offline comms about this.
Sure the AGS team are going to be hard done by.
So are all the ex GIA color graders replaced by colorimeters and the clarity graders replaced by IBM & AI. And the AGS lab grading team.
That is life.

If anyone ever submitted 2,000 stones to AGS they would be a going concern.

The lab seems to have been unpopular with many (most?) of the AGS members. How many wholesale members used it?
How many retailer members sold lots of AGS 0 diamonds?

On the positive side, GIA may just be able to develop a fancy cut grading system using AGS research. If they do, maybe they will keep some of the R&D team? Hope so.

Good on IGI for starting a fancy shape grade, even if it is not perfect because clearly that prompted GIA to make the move.
 
DRSAMURAI said:
Paul of JannPaul offers his most recent insights and opinions on the merger:

just an update cause i see alot of speculation on pricescope and this open to be quoted by me, finished my meeting with both labs.

1.) GIA will not be changing their cut grading system, if anyone was wishing for a new lab report that combines the 2, like incorporating the aset into the gia cert/ creating a premium gia cert that's not ever happening and confirmed.
2.) all recertifications, or resubmissions will be fresh as a whole to GIA. if there's any discrepancies found(this opens a huge pandora box) between the 2 labs now, there will be no support given, it'll be up to the retailer to explain to their clients. (sorry my personal opinion is that GIA threw all ex ags clients just under a bus. The team in ags fought to push through as much as possible of their outstanding services over the years, but alot of it was denied
3) past submissions, recertifications, will have to go through the 3 exc. if you were a previous agsl vendor, and need to recertify for your client or your own past diamonds, everything will rerun through the whole new gia system brand new, no subsidy, full charge as a brand new submission no support is given, should you have any discrepancies that's all on you.
4.) all AGSL vendors of the past, knows the lengths AGSL goes for their vendors, cut scans will be sent first to evaluated and studied for the possibility of ideal 0 light performance, agsl will then provide a comprehensive zenith and guide for them if or not and how to make the ags 0 ideal cut grade. this service is entirely terminated.
5.) if you choose to go for the ags ideal light performance report + GIA, and you're speculating that new vendors would jump on this bandwagon, there's is no support given. If say you choose to submit 2000 stones with gia + the new ags submission report, first you'd need to make the gia 3exc grade. there will be no support given from gia nor ags on what will meet the ideal 0 mark anymore. if 1000 stones do not meet the criteria for agsl 0 light performance, you will be reimbursed half of the price of the you paid for the 25$ usd of that 1000 stones(lol). we're talking about just round brilliants alone, forget even fancies. so if you're unfamiliar with the ags ideal 0 metric of the past. you're pretty much gambling.
6) the new ags light report digital really just looks... vendors might as well just take their own aset scope at this point.

this is as much as i'm allowed to say.

read between the lines: that im extremely unhappy with what's going on and all the marketing fluff. the team in AGSL especially their RnD team are fabulous fantastic hard working people, they've had tons of really innovative rnd works they were working on last year that i know of, that could help immensely in transparency and cut innovation for both products and consumer protection, that was all cancelled. Those who has had the honor to work with the rnd team before know that they're extremely passionate people at their work who go far and beyond with the passion of shipley's TRUE vision.
One cannot support a broken system if the broken system is confirmed in place to stay. that's all I can say.

Paul Hung
Ceo of JANNPAUL
Click to expand...

I'm sorry. Am I reading this right that basically GIA will have 2 bites at the same apple? Full charge to run the same stones through and no support or info given on what will constitute the new 3 excellent or ideal light performance?
 
Sorry to be a Debbie Downer....but this really sucks.
Of course for the specifics: from my perspective, AGSL was an opportunity for consumers. Gone.
Again- my perspective is colored by my experiences in this business- but having one company with so much market share/power is horrible for consumers.
The billionaires who can spend hundreds of thousands a month on Google ad placements.....or in this case, GIA...they want to destroy the competition.
It really seems like years ago, the competition was far more honorable.
Sure, each merchant would have liked to earn every sale- but we realized how valuable the competition was.
Competitors actually assisted each other. And everyone won.
As opposed to the world today, where a few people win HUGE- and the rest of us....can eat cake.
So sad.
 
If anyone was submitting 2000 stones to AGS, AGS would still be here as its own entity.

all AGSL vendors of the past, knows the lengths AGSL goes for their vendors, cut scans will be sent first to evaluated and studied for the possibility of ideal 0 light performance, agsl will then provide a comprehensive zenith and guide for them if or not and how to make the ags 0 ideal cut grade. this service is entirely terminated.
If they'd simply publicised these details this sort of back-door hand-holding - what a time suck it must have been!! - wouldn't have been necessary. This model, whilst laudable in intent, is unscalable and wholly unsustainable.

I urge consumers to read vendors' statements on this critically: Every single person with money in this industry has a personal agenda. PS as a forum has a tendency to put certain philosophies, concepts, ideologies, and authorities on pedestals that aren't necessarily deserved.
 
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Look I may be being overly optimistic, but I’ve overseen a couple of merger integrations in my time. The main aim (not always realised) was to try to take the best of both entities and combine to create something superior to what went before.

If I were managing or consulting on this merger I would be encouraging the teams to take the best of both entities - taking into account a broad reference of stakeholders and client feedback.

Now I know in real terms it’s usually the guy who (thinks he) has the biggest dick… er I mean the dominant shareholder representative within the organisation, who disproportionately influences which platforms, processes and policies take centre stage. But I still hold out hope that brains rather than egos will prevail in this circumstance.
 
Ionysis said:
Look I may be being overly optimistic, but I’ve overseen a couple of merger integrations in my time. The main aim (not always realised) was to try to take the best of both entities and combine to create something superior to what went before.

If I were managing or consulting on this merger I would be encouraging the teams to take the best of both entities - taking into account a broad reference of stakeholders and client feedback.

Now I know in real terms it’s usually the guy who (thinks he) has the biggest dick… er I mean the dominant shareholder representative within the organisation, who disproportionately influences which platforms, processes and policies take centre stage. But I still hold out hope that brains rather than egos will prevail in this circumstance.
Click to expand...
Naughty but right!
 
Well, this has certainly created some drama! At least for the vendors.

Whiteflash can relate to the angst in some of the commentary as this is an unexpected earthquake for those of us who are serious clients of AGSL. And there are countless repercussions involved in adapting to the new reality that will consume time, money and resources. It also comes on top of a lot of other challenges, and at the worst possible time of the year. There, I vented. o_O

But I see no reason for consumers to be up-in-arms. Just the opposite. The synergy of this merger has the potential to be a gold mine for the consumer market in the long run. And thus, for the industry as a whole. And good for individual companies that can adapt and seize the opportunities that will arise, including other labs like GCAL to gain market share, which is also a good thing giving consumers more choice.

Fancy cut grading is the next frontier and represents a HUGE opportunity for GIA to reinvigorate the market by encouraging improved cut quality and innovative diamond design. This is one of the few specific mentions in the initial GIA press release regarding their long term plans, so it is reasonable to assume they are going to support AGSL technology in a very big way. They are also keeping the AGSL cut research team intact and they are going to be building out the existing lab facility into the new GIA cut research center. So, the new GIA cut research center will continue to share a campus with the AGS (American Gem Society). This is more like a family reunion than a murder. :)

Only time will tell how everything shakes out, but from what I have learned over the past few days and just my own gut instincts, I think this is a brilliant move for GIA who have been struggling to develop a fancy cut grade system of their own, and a perfect avenue for the legacy of what the team at AGSL accomplished to be able to live on and prosper. They could never have attained the reach or had the resources to penetrate the market to the extent their world-class light performance system deserved. Now they will.

I could be wrong in my rosy outlook. So bookmark this post in case you want to hit me up with "I told you so" in a couple of years. Or to greet me with candy and flowers if I'm right. :twisted2:
 
I love your optimism Bryan!
I don’t share it - but I love it.
I don’t perceive GIA as struggling with anything other than what to do with all that money. Of course, from my perspective, Fancy shape Cut grading isn’t a desirable goal anyway. It would inhibit creativity. And the overall cut quality of fancy shapes has increased dramatically over the past 10 years. Without GIA cut grading.
That is a different topic- fancy cut grading- but I don’t think it’s all that important to GIA.
I can really relate to the issues this causes for the sellers who based their brands on AGSL. Suckage.
 
Rockdiamond said:
I can really relate to the issues this causes for the sellers who based their brands on AGSL.
Click to expand...

I know of one brand that is currently planning to sell its existing AGSL reports to clients, and I suspect there will be many who wish to buy them. As we replace them, we will go with the GIA with the AGS frosting so long as the requirements to getting the AGS triple 0 cut grade are not watered down. If they are we will look towards the tight light grading alternatives that are going to be available.

Life is interesting right now, anybody up for another couple years of cut grading wars?
 
Texas Leaguer said:
Well, this has certainly created some drama! At least for the vendors.

Whiteflash can relate to the angst in some of the commentary as this is an unexpected earthquake for those of us who are serious clients of AGSL. And there are countless repercussions involved in adapting to the new reality that will consume time, money and resources. It also comes on top of a lot of other challenges, and at the worst possible time of the year. There, I vented. o_O

But I see no reason for consumers to be up-in-arms. Just the opposite. The synergy of this merger has the potential to be a gold mine for the consumer market in the long run. And thus, for the industry as a whole. And good for individual companies that can adapt and seize the opportunities that will arise, including other labs like GCAL to gain market share, which is also a good thing giving consumers more choice.

Fancy cut grading is the next frontier and represents a HUGE opportunity for GIA to reinvigorate the market by encouraging improved cut quality and innovative diamond design. This is one of the few specific mentions in the initial GIA press release regarding their long term plans, so it is reasonable to assume they are going to support AGSL technology in a very big way. They are also keeping the AGSL cut research team intact and they are going to be building out the existing lab facility into the new GIA cut research center. So, the new GIA cut research center will continue to share a campus with the AGS (American Gem Society). This is more like a family reunion than a murder. :)

Only time will tell how everything shakes out, but from what I have learned over the past few days and just my own gut instincts, I think this is a brilliant move for GIA who have been struggling to develop a fancy cut grade system of their own, and a perfect avenue for the legacy of what the team at AGSL accomplished to be able to live on and prosper. They could never have attained the reach or had the resources to penetrate the market to the extent their world-class light performance system deserved. Now they will.

I could be wrong in my rosy outlook. So bookmark this post in case you want to hit me up with "I told you so" in a couple of years. Or to greet me with candy and flowers if I'm right. :twisted2:
Click to expand...

Time for Whiteflash to start a grading lab?
Top cut grade: A Cut Above
...the royalties will pour like Niagara Falls!
 
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DejaWiz said:
Time for Whiteflash to start a grading lab?
Top cut grade: A Cut Above
...the royalties will pour like Niagara Falls!
Click to expand...

To do it right will cost many millions of dollars, and require them to stop selling diamonds to avoid conflict of interest concerns.

I suspect the concomitant red ink would be disastrous for our friends at WhiteFlash. I can appreciate your humor Deja, but I suspect your arrow is not on target.

Wink
 
Wink said:
I can appreciate your humor Deja, but I suspect your arrow is not on target.
Click to expand...

I think Deja has a good point. Of course you’re correct in that they couldn’t grade competitors stones…. But I bet a lot of consumers will trust a company like WF more than they trust GIA to grade the cut of stones.
 
Wink said:
To do it right will cost many millions of dollars, and require them to stop selling diamonds to avoid conflict of interest concerns.

I suspect the concomitant red ink would be disastrous for our friends at WhiteFlash. I can appreciate your humor Deja, but I suspect your arrow is not on target.

Wink
Click to expand...

It was purely in jest, Wink. :)
 
Wink said:
I know of one brand that is currently planning to sell its existing AGSL reports to clients, and I suspect there will be many who wish to buy them. As we replace them, we will go with the GIA with the AGS frosting so long as the requirements to getting the AGS triple 0 cut grade are not watered down. If they are we will look towards the tight light grading alternatives that are going to be available.

Life is interesting right now, anybody up for another couple years of cut grading wars?
Click to expand...

Hi @Wink ! Congratulations on Continental! Would you mind elaborating on what you mean by "we will look towards the tight light grading alternatives that are going to be available" What are the alternatives that you see coming ? Would love to hear your thoughts!
 
Rockdiamond said:
I think Deja has a good point. Of course you’re correct in that they couldn’t grade competitors stones…. But I bet a lot of consumers will trust a company like WF more than they trust GIA to grade the cut of stones.
Click to expand...

They also trust a company like WF more than they trust(ed) AGS to evaluate the cut of stones… ::)
 
Mlh said:
Hi @Wink ! Congratulations on Continental! Would you mind elaborating on what you mean by "we will look towards the tight light grading alternatives that are going to be available" What are the alternatives that you see coming ? Would love to hear your thoughts!
Click to expand...

Perhaps GCAL 8X, much the same as JannPaul has been hinting at?
Dunno...
 
DejaWiz said:
Time for Whiteflash to start a grading lab?
Top cut grade: A Cut Above
...the royalties will pour like Niagara Falls!
Click to expand...

Ha! I know you are kidding @DejaWiz , but I can assure you Whiteflash is not starting a new business. We have our hands plenty full at the moment :roll:

And running a grading lab has to be one of the most difficult jobs in the industry. Besides the complexities and logistical and operational challenges, you are working on a constantly rolling sea with frequent squalls and some hurricanes. Keeping up with rapidly advancing technology, always having to invest in newer more expensive equipment, dealing with the pressures of clients who regularly have a different opinion on grades, maintaining your ethics and reputation, paying the bills. It's really a wonder that any of them can successfully navigate all those obstacles and more.

I have sincere respect for them all. Both AGSL and GIA have a special place in my heart, but I tip my hat to the likes of IGI, GCAL, HRD and others for doing this difficult work and moving the industry forward.
 
Wink said:
I know of one brand that is currently planning to sell its existing AGSL reports to clients, and I suspect there will be many who wish to buy them. As we replace them, we will go with the GIA with the AGS frosting so long as the requirements to getting the AGS triple 0 cut grade are not watered down. If they are we will look towards the tight light grading alternatives that are going to be available.

Life is interesting right now, anybody up for another couple years of cut grading wars?
Click to expand...
Rockdiamond said:
I love your optimism Bryan!
I don’t share it - but I love it.
I don’t perceive GIA as struggling with anything other than what to do with all that money. Of course, from my perspective, Fancy shape Cut grading isn’t a desirable goal anyway. It would inhibit creativity. And the overall cut quality of fancy shapes has increased dramatically over the past 10 years. Without GIA cut grading.
That is a different topic- fancy cut grading- but I don’t think it’s all that important to GIA.
I can really relate to the issues this causes for the sellers who based their brands on AGSL. Suckage.
Click to expand...

@Rockdiamond ,
I will defer to your considerable experience when you say fancy shape cutting has improved significantly in recent years.

And with your experience you can select the nicest performers. But consumers don't have the tools do that independently. Developing a science based standard will help consumers to feel more comfortable buying fancies, especially online.

And when such a standard is established, cutters will have incentive to cut to that standard thereby raising cut quality on a broad scale.

I agree with you that cutters are extremely creative. And some are using that creativity to make the most beautiful diamonds. But on a broader scale they are using their creativity to get the best value out of a given piece of rough, by cutting a sellable stone while maximizing carat weight. The only thing they are rewarded for today with current GIA grading is to get Ex polish and Ex symmetry when possible, to imply high quality. From a consumer standpoint this is a poor substitute for a vetted grading system that can report on overall cut quality and light performance.
 
Texas Leaguer said:
@diamondseeker2006 ,
Normal wear and tear will have negligible effect on a diamond's geometry, even after many years of daily wear. If the stone is actually broken, then that's a separate issue altogether. Assuming the diamond is not in need of a re-cut, the original 3D scan will provide the data to run the AGS ray tracer and get an accurate light performance grade.
Click to expand...

Slightly off topic but still relevant (i think)

Would you be willing to say what percentage of WF diamonds that didn’t have negligible wear and tear when they were inspected for trade in?
 
@Texas Leaguer
This is a great discussion- and informative.
I think there are two separate issues here.
1) does GIA give a $hit about cut grading at all?
2) Is there a need for fancy shape cut grading...and is it even possible to create a workable system?

The answer to number one seems to be.... "meh"
I think it was at least 10 years ago that I was invited to GIA to participate in a study of fancy shaped diamonds- with the goal of fancy shape cut grading.
We can see where that went.
Question number 2 definitely deserves its own discussion and it's likely we've probably already done that:) I'd love to re-invigorate that discussion.
 
Rockdiamond said:
I don’t perceive GIA as struggling with anything other than what to do with all that money.
Click to expand...
No struggle here. They pay it out to their executives. That's how they're non-profit.

projects.propublica.org

Nonprofit Explorer - ProPublica

Since 2013, the IRS has released data culled from millions of nonprofit tax filings. Use this database to find organizations and see details like their executive compensation, revenue and expenses, as well as download tax filings going back as far as 2001.
projects.propublica.org
 
Rfisher said:
Slightly off topic but still relevant (i think)

Would you be willing to say what percentage of WF diamonds that didn’t have negligible wear and tear when they were inspected for trade in?
Click to expand...

I can't put a figure on it, but our lifetime trade-up benefit is quite popular and we have been doing upgrades for over twenty years. Many, if not most, of these diamonds have been worn every day in a variety of conditions by folks with a variety of lifestyles. And it is rare that there is ever any issue detected in our inspection or on the new lab report that we always have done. Exceptions do occur, but properly crafted round diamonds are remarkably durable.

I don't recall any higher rate of issues with the princess cuts we sell either (maybe because the sample size is significantly smaller), though they are more susceptible to damage at the points. We are careful to vet out those that have elevated risk due to clarity characteristics at the tips, and the greatest risk is always at the time they are being set. Damage can also occur as they are handled as loose stones if you are not careful. Once set, princess cuts are very durable as the tips tend to be protected by the prongs.
 
gia-acc.JPG
So...I'm not really able to comprehend this.....are cash and assets $127,805 x 1000?
That would equal almost $128 Million bucks on hand.
Wow.
Like they give a hoot about cut grading......
 
Rockdiamond said:
gia-acc.JPG
So...I'm not really able to comprehend this.....are cash and assets $127,805 x 1000?
That would equal almost $128 Million bucks on hand.
Wow.
Like they give a hoot about cut grading......
Click to expand...

Just cash and inventory = $131.5M

Once the acquisition of AGS is complete, there is really no good reason that GIA can't change their 3X grade to be AGS 000 with three dimensional light performance assessment, in my opinion...or just integrate AGS's "triple ideal" into their cut grading and place it above their "triple excellent" while performing the three dimensional light performance assessment on all diamonds that come into their labs, going forward from that point.
 
DejaWiz said:
Just cash and inventory = $131.5M

Once the acquisition of AGS is complete, there is really no good reason that GIA can't change their 3X grade to be AGS 000 with three dimensional light performance assessment, in my opinion...or just integrate AGS's "triple ideal" into their cut grading and place it above their "triple excellent" while performing the three dimensional light performance assessment on all diamonds that come into their labs, going forward from that point.
Click to expand...

I agree with this. If GIA doesn't, I predict GCAL 8X will become more popular, especially among superideal vendors.
 
Rockdiamond said:
gia-acc.JPG
So...I'm not really able to comprehend this.....are cash and assets $127,805 x 1000?
That would equal almost $128 Million bucks on hand.
Wow.
Like they give a hoot about cut grading......
Click to expand...

Yes, that's what that means. Presumably, they just gave a bunch of that to AGS, but the details weren't released.
 
DejaWiz said:
Once the acquisition of AGS is complete, there is really no good reason that GIA can't change their 3X grade to be AGS 000 with three dimensional light performance assessment
Click to expand...
The intellectual property rights to the 0-10 grading scales belong to AGS the society, not the AGS Lab. AGS is not closing and they are not being acquired. They are not surrendering this in the closure of the lab. It's perhaps worth noting that they trademarked their grading scales, including the light performance scales. I suspect this $25/stone business is a license, not a sale.
 
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denverappraiser said:
The intellectual property rights to the 0-10 grading scales belong to AGS the society, not the AGS Lab. AGS is not closing and they are not being acquired. They are not surrendering this in the closure of the lab. It's perhaps worth noting that they trademarked their grading scales, including the light performance scales. I suspect this $25/stone business is a license, not a sale.
Click to expand...

Ah, that's good info...thank you, Neil!
 
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