Formula One Set for Major Changes After $8 Billion Takeover
File photofrom an F1 race. (Getty Images)
Paris: It may not require an overnight emergency operation, but Formula One will surely undergo some serious life-affirming surgery in the years ahead following this week’s multibillion-dollar takeover.
A revised and probably expanded calendar that may include more races in Asia and the Americas could see this year’s record 21-race schedule enlarged to a bumper 25 grands prix.
The teams and fans are expected to be much more involved and micro-targeted in a restructured business that is likely also to re-evaluate the points structure and the racing to ensure a massive overhaul of the sport’s entertainment value, experts say.
Formula One's current limited activity in social and digital media is also expected to be ramped up to make the sport more appealing to the next generation of fans, amid fears it is failing to get younger viewers on side.
US billionaire John Malone's Liberty Media, which says it has struck an agreement to buy out Formula One's parent company, wants to do all this without eroding the sport's exclusive brand value.
"Formula One is a key player in the high-growth market for live, premium sports rights. There is an increasing demand from broadcasters, advertisers and sponsors who want access to F1’s mass global live audiences and attractive demographics,” said Chase Carey, named as the sport’s new chairman.
This is unlikely to become a new area of expertise for the sport’s long-serving ringmaster Bernie Ecclestone, who will be 86 next month, and his authority and out-sized influence will wane as the business becomes more corporate under Carey, the 21st Century Fox vice-chairman.
Ecclestone was retained as chief executive and the main office remains in London.
The takeover that values the sport at $8 billion has -- crucially -- been welcomed by the teams, with heavyweights McLaren on Thursday describing Liberty’s move as "a positive step".
The FIA, motorsport's governing body, also hailed the move.
FIA president Jean Todt said: "While it remains to be seen how this acquisition will influence the promotion of the FIA Formula One championship, we welcome this long-term investment in Formula One by a company that has such a broad portfolio of sports, media and entertainment businesses."
Liberty has said it will work closely with teams to ensure their income increases with the sport’s growth in popularity.
Paddock gossip at last weekend’s Italian Grand Prix made it clear that Liberty had already sold their vision of the future successfully before completing the deal and Carey on Thursday endorsed that impression in a media conference call.
By itself, that simple action -– a normal part of American media relations -– confirmed how much change was taking place. Ecclestone, who ruled with much secrecy for four decades, was rarely inclined towards any kind of management in that way.
"We're all partners in the business. Simply, Formula One and the teams should basically grow the business going forward," said Carey, signalling another change in tack from Ecclestone.
In specific terms, Liberty hopes to develop F1 for the benefit of all of the stakeholders and will focus on five key areas: increased promotion and marketing; enhanced distribution of digital content; a broader range of partners and sponsors; a revamped race calendar; use of more complementary live events to boost digital income.
Carey said he and Liberty were excited by the prospects in "developing markets" in places like the Americas and Asia. "But," he stressed, "I want to be clear that, certainly, the established markets –- the home and foundation of Formula One in Europe –- are of critical importance."
And he made clear that development of the Asian and American markets was a long-term goal to be achieved "using digital platforms and some of the tools that haven’t been exploited aggressively".
Carey, eased out of power by a change of succession at Rupert Murdoch’s News Corp, has a proven record in expansive sport-media growth and respected expertise in the value and exploitation of sports rights, notably in the US market.
That, added to Liberty’s success with the Atlanta Braves Major League Baseball (MLB) team, demonstrates where they are heading.