Motorsport: Goodwood bows to Hollywood
Bob McMurray ponders the impact of Formula 1 ownership changes
Once again Formula 1 is in the world news and all because of forces outside the on-track “sport”.
The latest news has the potential to affect everyone from owners to drivers to fans.
For 10 years, the F1 teams and most observers have been critical of the way CVC Capital Partners, the sport’s majority and controlling shareholders, have allegedly stripped money from the sport with no reinvestment, nor seemingly with any care, as to the wellbeing and future of this, for them, cash cow.
Estimates vary about just how much that company has sucked from the sport over that time but it is somewhere in the NZ$5.5b range and, despite all the criticism, it has to be remembered that CVC does exist to make money and return profit to its investors.
In the past week or so all of that changed with a new “owner” of the sport having done a deal to acquire the majority shareholding.
Rejoicing has been heard from up and down the paddock and observers see this acquisition as the harbinger of a brave new dawn.
The widely acknowledged “boss” of the sport, Bernie Ecclestone, has also made billions from the sport but it has to be remembered that he was the one who started the business in the first place to enable all that money to come rolling in.
Bernie Ecclestone staying on. Picture/Bloomberg.
By making his own empire, he is the man who made it all possible for those other F1 millionaires to make their fortunes.
Sensibly, it seems that the new “owner”, Liberty Media Group, has kept Bernie on for another three years — as nobody knows the business as he does.
The details of the deal are complex and are, quite frankly, beyond the total understanding of a mere mortal such as I.
Many expect this new management to push the sport in a new direction by being more active in the promotion and marketing areas.
I guess that can be only a good thing as Liberty Media, owned by billionaire John C. Malone, is essentially a mass-media specialist, also owning or having major interest in such diverse businesses as the Atlanta Braves baseball club, pay TV channels, the Discovery channel, Time Warner and much more.
The sport is destined to expand into all forms of social media and viewing platforms and the result may not please the “purist”, as whatever remains of the air of tradition and heritage will almost certainly take a backseat as the show becomes more Hollywood than Goodwood.
Liberty Media, under one of its many company banners, also owns a controlling stake in the rapidly rising, all electric, Formula E series and will therefore have a controlling interest in both of the FIA topline open-wheel series.
One of Ecclestone’s admitted failures has been to secure the sport a proper foothold in the US, and Liberty is ideal to overcome that obstacle.
The man who will take on the job of F1 chairman, Chase Carey, has a formidable record in the entertainment business as vice-chairman of 21st Century Fox Media and the acknowledged successor to Rupert Murdoch of News Corp fame.
This will be no “hands off” operation for Carey and Liberty and, although Ecclestone has reportedly been asked to stay on for a further three years, I think it will not be long before we see yet another graceful “retirement” from the driver’s seat of the business.
So the wedding has happened and the honeymoon will begin but what will the marriage be like?
There must be some concerns.
Perhaps franchising of the teams in the sport will come along and that will make it even more difficult for any new teams to enter an even more exclusive club.
Will there be more events added to the already-crowded calendar that will put even more pressure on the teams?
Will the “heritage” of the sport turn into a made-for-TV special each week?
Perhaps the ticket prices will come down, the show will improve and F1 will prosper with a new and bigger audience?
Only time will tell.