Quick Quiz: Name the US circuit in the picture above
In 2014 Bernie Ecclestone managed to pay $100m to a German court and in return the charges of bribery against him were dropped. This gave Ecclestone a new found confidence who was backl to making pronouncements,’the Bernie way soon after’. One of the more amusing was when Ecclestone stated he had no interest in attracting young fans to Formula One because they could not afford to buy a Rolex. “I don’t know why people want to get to the so-called ‘young generation’. Why do they want to do that? Is it to sell them something? Most of these kids haven’t got any money. I’d rather get to the 70-year-old guy who’s got plenty of cash”.
And to some extent Bernie has a point because most revenues raised by sport globally are done so on the platform of selling something to the spectators/viewers. In its purist form, the fans themselves pay to watch the sport – whether by attending an event or by paying for subscription TV.
Free to air TV has historically delivered sport to fans at no cost, because sponsors and advertisers pay the broadcaster who in turn pays the sporting organisation the fees they require. And despite the veneration paid to F1’s genius architect – ‘the honourable Lord Bernie’, it was this simple model he first employed to increase revenue into Formula One – charge the TV companies. Whilst hardly a strategy requiring rocket science type thinking, Bernie has been revered for years because of this turnaround in F1 funding during the 1980’s.
At that time the track owners contributed little or nothing to F1’s coffers, but took the risk of promoting an event and as reward received ticket and merchandising sales together with track side advertising. The profit incentive meant there was even competition amongst promoters to hold certain national F1 grand prix.
Having stepped in at the last minute to save the 1974 Belgium GP, Ecclestone was aware of the cash available to race promoters, so as the easy TV money became ‘maximised’ he turned his attention towards the promoters for more and more revenue. Hosting fees were hiked ever higher and the track side advertising revenue was snatched from the local venues too.
Given some of the deals done recently in Canada and Australia, it would appear Ecclestone has probably maximised the monies he can extract now from most race promoters – particularly because few are self-sustaining events and most rely on local governmental funding. However, with the number of fans falling at many F1 events, the current levels of race hosting fees may soon come under pressure – particularly for the likes of Silverstone who’s fee to FOM is set to double in less than 10 years.
More races per season has been part of Bernie’s recent solution – and racing more in the East where officials in less democratic countries find it simpler to procure eye watering amounts from the public purse to deposit in FOM’s bank account.
However, the TV revenues and numbers of fans attending races in ‘F1’s new world’ in the East, are no match for those in F1’s heartland – Europe. Even TV audiences in the USA have been on the up and on occasions this year have exceeded SKY UK’s live race viewership – even when they have exclusive live UK coverage.
Other than adding ever more races, Ecclestone looks as though he has run out of ideas on how to build F1’s revenues, yet the biggest opportunity and smartest approach is staring Bernie in the face.
At the 2015 Russian GP, Ecclestone gave an interview to a local broadcaster claiming Putin was a “super-guy” and “democracy is over rated”. Ecclestone also said of the USA, “the biggest problem with them is that they believe [that they are the] greatest sort of power in the world”. Also that “they are a big island, so they are a bit isolated; they are slowly starting to learn what other people in the world do”.
This is code for Bernie so far failing to hoodwink anyone else in the USA into promoting the New Jersey GP and coughing up $40m plus to FOM. Ecclestone concluded his Russian interview saying, he was “not very enthusiastic about America”.
And herein lies the key to Bernie’s ultimate failure to take Formula One to the next level. US race promoters can do maths and know they cannot sell enough hot dogs to put on a race AND pay Bernie around $40m. Yet were more races to be scheduled in the Americas, the US TV audience would continue to build – along with TV revenues.
U.S. Grand Prix organiser Jason Dial hit back at Ecclestone following his comments in Russia. “Obviously, he’s entitled to his opinion,” said the president of the Circuit of the Americas. “The team principals that we talk to unabashedly state how important the U.S. market is to them and their sponsors,” he added.
Then there’s the importance of the USA to sponsors, eloquently expressed by Pirelli’s Paul Hembery who began his US GP weekend preview by stating, “The United States always offers us a very warm welcome and a fantastic race weekend. Like all the other stakeholders in Formula One, America is a crucial market for us so it’s very important for us to have a race there”.
Following his love in with Putin, Bernie Ecclestone appeared to suggest he was working on another race for the USA in southern California. Yet US GP race promoter Bobby Epstein suggests Ecclestone’s amitions are not sufficient to embed Formula One within US sport’s culture. “Two races wouldn’t help much,” he told the Guardian. “But six could. I’m talking about building an audience. You have to get up very early in the morning to watch F1 in America. So if you had six races in this time zone, it would make a big difference.”
Six races in the USA appears a lifetime away, given F1’s history with that part of the world. However, a mini season of 6 races in the America’s as a whole could be a way of building momentum with US TV viewers. Currently there are four races in the America’s – Montreal, Austin, Mexico City and Sau Paulo. If another one or two races were added in the USA, these 6 events could be scheduled one after the other changing the TV habits of motor sports fans across ‘the pond’.
Given that SKY UK pay around $100m a year for the privileged of broadcasting F1 each week to a UK audience of mostly under 1 million, what kind audience could be built in the USA if Formula One was regularly broadcast live at civilised times – and what kind of broadcasting revenues could then be charged?
Given Bernie coughed up $100m to the social fund of Bavaria last year, maybe a $100m spent on establishing 2 more F1 races in the USA (whilst cancelling the ridiculed events held in Baku and Sochi), would pay a handsome dividend to F1’s owners in medium term.
So TJ13 jury, where could F1 race in the USA? Are there any venues where the cost of bringing a circuit up to the FIA category 1 standard would not be too great?
RE picture
2007 Indianapolis, home Lewis’ 2nd win in his F1 career.
Close – but no cigar
It’s Watkins Glen in upstate NY. I was there, cold and rained all day. Professional eater Tony Stewart won the opportunity to drive Lewis’ 2008 championship winning car, and Lewis drove some guy’s nascar.
Here’s a gallery from the day: https://picasaweb.google.com/106428857467928696457/F1DriverSwap?authuser=0&feat=directlink
You need to target the states/cities where there are the most European-based ethnicities. Texas was a good choice, next should be California and New York.
What about Florida, for the ‘Rolex’ generation? Maybe some Latino fans as well?
I would imagine that more US GPs would mean more evening races for European viewers so I’d be well into that.
and less early morning races for Europe TV viewerss
I like the 7 & 8am starts we get In the Americas when the circus is on the European leg, it doesn’t screw up the afternoons. Summer in Canada is to short (and spectacular) to spend weekend afternoons on the sofa.
Surely the answer to this – and a lot of other problems – is to have a serious ‘second tier’ which, rather than following F1 around, creates a circus of its own?
Maybe year-old F1 cars with slightly de-tuned engines to get running costs right down. Teams could run their own outfit in this series, or sell the cars to independents.
All those drivers who nearly get to F1 but get cast aside would have somewhere to race and show their talent. There would be a clear pecking order for drivers to move up to F1 itself.
And they could race at the classic tracks as well as expanding markets.
I don’t know if they still do, but the WRC always insisted a new event had to prove itself first. Generally a lower formula rallied there first (IRC or a local top level series) and it was monitored to ensure everything worked.
This series could be used to ‘bed in’ new tracks, keep the classics alive and spread F1 wider.
Where are the down-sides?
If you have a premier F1 division and an F1 division, that’s not good, the premier division will be dominated by 4 teams with 3 cars each. If we’re talking about a two-tier system within F1, then in a way it’s like going back to the late 80s/early 90s when you had both turbos and aspirated engines. Problem is, as an industry you’ve introduced hybrids because you want to go greener, if you introduce now a cheap V8, it’s like going back on your promise.
I’m talking two completely independent series which go to different venues. A bit like the WRC and IRC going back a few years before the IRC became more popular with the fans and had to be emasculated.
Both had great drivers, both went to classic rallies and between them covered far more of the globe than a single series could. Some WRC drivers that had lost their seat when teams closed found a seat in the IRC to keep their career alive. Similarly, young drivers got a start in the IRC and are now in the WRC.
It would also offer an easy ‘in’ for new teams – you’ve got to run say 3 seasons in the lower series learning how to run an F1 car before you can set up.
Watkins Glen
car swap with Tony Stewart
Didn’t that happen in 2011? This car in the picture looks like the ’07-’08 Macca
I was totally guessing. It looks like Watkins Glen . And I didn’t remember them being there any other time.
But, just a guess.
I think its the The Glen too – and you are right about the car swap as well
I always thought road America is a brilliant track.
Don’t Bruznic, just don’t. If F1 goes to Road America the 1st thing they will do is rape (pardon my language) that magnificent track with massive run-off area’s. Same with Laguna Seca and that track is way to tight for F1. If you can race at Laguna you can race at Imola.
They have a formula of, speed and degree of turn, equals x amount of runoff.
Making it almost impossible, to use a currently operating track.
Plus, their paddock and team accommodations , are pretty costly and hard to fit in, at some tracks.
But it is a brilliant track.
it is, you’re right. If Indycars can run it, why can’t F1?
Yes, it is absolutely great. I attended a CART race there – it was better than F1.
To answer the Judge’s final question: where? COTA was built at a estimated cost of $500millionUS and did it with some tax incentives from the State of Texas(BTW: COTA has paid only $5million of a $35million property tax bill and in a legal dispute over that figure). No one will build a brand new track in California or anywhere on the East Coast between Maine to Virginia. In California, Laguna Seca will never pass FIA scrutiny with the famed corkscrew turn and it is narrow. Sonoma is probably a better choice since it’s closer to San Francisco but raising it to FIA standards probably equal the full cost of COTA alone. Before the return of Indianapolis, there were serious talk about street course in downtown Las Vegas and that could happen again. Long Beach is out of the question. There’s Miller Motorsports Park in Utah, Barber Motorsport Park in Alabama and Virginia International Raceway near Richmond-all capable of holding a F1 race but 2 are on the Indycars schedule. Florida may be the best option with a race at famed Sebring or street course in Miami.
Las Vegas makes sense; it was interesting to see @virtualstatman Sean Kelly provide a redacted document on twitter, about a bid for a 2014 San Diego GP using the convention centre as the pits. From 2011, this was to follow COTA 2012 and NJ 2013, as a 3-race return to the US.
In reality, I’d go for a return to Indy, even as a 300 mile oval race (would need sturdy tyres) in Monza spec. Sebring or something in the Florida region would be next, if California is a no-go. That would be 6 races in the American time zones.
And if not Sebring, Daytona? 2 Rovals might not be great, but 2 ovals would be left field!
I’m with Ward Merrell on this. Watkins Glen car swap 2011 in the Macca MP4-23
What a load of! The problems of F1 are profound. Merely having lots of crap races in the USA instead of an equivalent number of crap races elsewhere is just to relocate crap.
There was once a time when there was an opportunity to integrate CART and F1 and the opportunity was missed. Now both series (or CART’s equivalent) are dead in the water.
Given that F1 is, and always has been, a sport appreciated most by Europeans, it would make sense to optimise performance the market that already exists. But there are too many competing vested interests to admit logical analysis.
Would be interesting to hear about that, when was it? How would it work? Would it be like a return to the Grand Prix era, but with CART on Ovals and F1 on the tracks?
Bring back the Detroit street circuit race! The Loads of fun back in the 80’s , it could be a a great boost to the city’s revival. (And, a quick trip across the border for me…!)
I think Indycar has the race, not sure if on the same course though.
OK. Do it then, Bernie…I dare ya. Watkins, Monticello, Road Atlanta, Laguna, Elkhart Lake, Mid-Ohio.
Hamilton-Stewart seat swap at Watkin Glen 2011 with his 2008 title winning MP 4-23
Bingo!
A west coast race would be nice. Unfortunately indycar only brought 5000 fans to Fontana which is less then an hour away from the great Los Angleles area, so yeah probably not gonna happen anytime soon. I think spending the money on the tv side of things for the next couple years would be more well spent. Educate the fan base then “if you build it they will come.”
A lot of friends watched the last Grand Prix because they knew I went there last year. Most don’t understand the racing. Until f1 starts popping up on ESPN here in USA no one will give it the time of day. A designated F1 Show like NASCAR America or NASCAR 120 or NASCAR motorsports hour could be the difference.
If Indycar are struggling to hold Boston, I wonder if they could renegotiate with Fontana or try and get Mexico early. Is the region fully served with Sonoma and Long Beach? Just a shame they can’t do a race at Laguna Seca, who lost MotoGP in 2014.
San Diego might make a lot of sense actually for Indycar come to think of it!
Downtown LA or on the beach streets of Venice would be nice, there are elevation changes on the coast between Santa Monica and Venice that could provide for some dramatic heli over the ocean filming back towards the shore shots.
Downtown San Francisco or Manhattan would also feel bizarrely exotic.
Street courses will be fine in the interim before new tracks are built or old ones brought up to code as many have already pointed out.
The US needs a quick short term effort to raise the sports profile, the real tracks can follow the interest.
San Francisco… suddenly I have visions of F1 cars racing down Lombard Street… 🙂
I am all in for Mosport – P2 ‘Vettes were running race laps over 125MPH a few months ago. not safe enough?? man up and grow a pair, Buttercup!!. same goes for the ‘Glen”. not been there, but Barber looks great. I prefer Mt Tremblant to Montreal any day. Mid Ohio and Road America are also pretty iconic with Trans Am/Can Am/F5000/Cart and a shitload of former International super star heros competing and winning in the past (Manufacturers too but who gives a flying shit about them!)… Lime Rock and VIR are kewl. not a fan of Road Atlanta, Sebring, Daytona, or Indy. not of Laguna either (its only claim to fame was “The Pass” by Zanardi on Herta in the Corkscrew)
BTW, I would NOT attend nor recommend any of the above if they had to be bastardized and Tilkerized as already mentioned above!!
but here is one last incredible facility: Burke Lakefront Airport in Cleveland, Ohio. super wide. 3 dozen different lines around most corners. ALWAYS entertaining and competitive and standing room only. held downtown in a resurgent City with the Rock and Roll Hall of Fame and one of the most iconic orchestras and music halls and museums. with many World class restaurants along side great local and regional joints and bars and pubs ranging from current all the way back to the speakeasy days of ‘Murica. in other words, not just a super kewl temporary track, but a true destination location for fans and the pretty ones.
within a 7 hour drive of WELL over 100 million people with a 4+ decades long proof of harboring rabid racing fans!!!
An airport-based track would work well, but there wouldn’t be any infrastructure, or even enough grandstands, to support it.
in all due respect, just as at the 1.5 mile oval track at Disney in Orlando, FL, the high quality aluminum grandstands are rented/installed/used/tore down/ and moved to another temporary facility – and then moved to another, etc… it worked well enough to create profits back then. it may work well enough today…
But isn’t the Disney track going out of business though? Can enough temporary grandstands, toilets, parking, etc be added to sell the tickets needed to pay the enormous Bernie fee?
I saw my first GP at Mosport in the 70’s. F1, Cart (pre Indy car), W superbike, WEC, NASCAR, Can Am (real beasts) almost every kind of race has been held there, it should be hosting the Canadian F1 race now. Great corners, passing opportunities and elevation changes It is a pretty setting and an amazing track. I’m afraid F1 would just ruin it with parking lot run offs and the cityscape construction, it doesn’t have the flashy look for the cameras. If you look at the criteria used to determine an F1 locations today, it has nothing to do with good racing or great tracks, it’s based on the plushness of the location and the bank accounts of the host. Better than 25% of the F1 stops are paid for by dictators, for races at lousy tracks. Abu Dhabi, Sochi, Monaco, China, Singapore, Bahrain, all sizzle no steak.
Cleveland is definitely a race that Indycar should be aiming to resurrect. They’re currently struggling to get 15 events, but with Mexico and maybe Gateway coming back for 2017.
COTA
Road America
Watkins Glen
Sonoma
Long Beach
Indianapolis
What a sweet schedule this could have been.
imagine five more tilkedromes … yum.
The USA would need a destination race. Some where there is something different to do and see night and day. Sorry but most if the tracks we have now are too far from destination cities to be viable in dollars and cents terms, except places like Las Vegas or Miami. But the good news is tourist towns would be much more willing to spend public funds to bring in more business.
CLEVELAND, LAGUNA SECA And PORTLAND.
GO, 44 !
“Ecclestone also said of the USA, “the biggest problem with them is that they believe [that they are the] greatest sort of power in the world”. Also that “they are a big island, so they are a bit isolated; they are slowly starting to learn what other people in the world do”.”
The biggest problem with Bernie is that he believes that he is the greatest sort of power in the World. Also that he is a big man, so that he is a bit isolated, out of touch with reality; he is slowly starting to learn that other people in the World do understand finance and economics and that 2+2 does not equal 5.
If Bernie wants his show in the US, then he needs to make sanctioning fees, sustainable. Notice that all of the heritage tracks are in trouble. Silverstone is in trouble because they’re a non-profit, and can’t make ends meet, when Bernie wants triple what they can afford to pay and make ends meet. France lost their race long ago. Germany, Germany!, can’t afford a race. Italy is in trouble at half the sanctioning fees that 3rd-world dictators can afford to pay. Canada has had trouble with the sanctioning fees in the past. Australia has had some doubt in the past. Belgium has had trouble in the past. What traditional race hasn’t had trouble affording Bernie’s hold-up fees?
If core viewership, in Europe, has dropped, it’s a long-term knock-on effect of the core audience being priced out of their home races.
People can debate about how to get 6 races in the Americas, but I’m the core audience for Bernie, and yet, I can’t be bothered. I’ve been to the Montreal GP, as it’s relatively close to me. I’ve been to the Chinese GP. I plan to go to the USGP in Austin someday, but if I can avoid putting more money into Bernie’s filthy pockets, I will.
The whole mindset has to change. If the sport wants to be sustainable, Bernie needs to get the smallest cut of the pie. The sport should be owned by its member teams. Bernie should just be getting a salary as sport promoter. Track sanctioning fees should be at at sustainable level so that tracks are clamoring for race dates. Doesn’t it bother people that tracks are sold on the idea that F1 will bring riches, by Bernie, and then when they host their first race, they find out it’s all a lie? It’s an embarrassment that F1 goes around to new places, like S Korea, and India and can’t pull in an audience. Is F1 popular or not? If not, then it should get smaller, a lot smaller, go back to its core roots, built around heritage tracks in Europe. Going global so that Bernie can get rich fleecing insecure despots should not be the goal of any fan of F1.