Made Liberty Media Formula 1 sustainable

Investors part of Liberty Media’s plan to restart sports

financial times, Page 2, by Samuel Ageni.

Not long ago, Liberty Media – The company controlled by the American billionaire John Malone – Patience asked to try to activate them Formula OneGlobal Auto Series. Now, however, the F1 Witnessing a moment of great success, after last year’s exciting championship duel between Lewis Hamilton subordinate mercedes And the Max Verstappen subordinate Red BullAnd after the grand prix opening in Miami this month. It has also attracted millions of new fans thanks to campaign to surviveDocumentary Netflix.

Liberty Media He took a risk when he acquired Formula 1 for $8 billion, including debt, in 2017. The sport has been driven for decades. Bernie Ecclestonethe former car dealer who made a change in F1 in a global phenomenon. “There were a lot of things we didn’t understand,” he says. Greg Maffey Financial TimesDirector general Liberty Media. “But we were right about the things that mattered to us.” The sport was in danger of becoming obsolete when Liberty Media Intervened. On the road, Hamilton And his team was probably too controlling, while Eccleston Neglect social media and younger fans in favor of an older, wealthier male audience. there F1 It needed to be more competitive and digitally advanced, while increasing its appeal in the United States.

Covid-19 survivor

“There was an opportunity to create a better product on track and experience online, to make it more attractive to both fans, because it was more competitive, and to the investors in the teams,” he says. there is no. “All of this will create momentum that will be in our interest as well.” But negotiations to change the sports economy stumbled at first due to disagreements with it FerrariAnd the mercedes And the Red Bullthe most dominant teams, and plans to expand into the United States have been drawn out.

Then, in March 2020, pandemic From the plan to re-launch sports Liberty Media. The opening race in Australia was canceled and the teams feared for their financial lives. yields F1 It fell 43% to $1.1 billion. there is no Develop a recovery plan. Liberty Media Activities shifted to strengthen the budget F1 With $1.4 billion in cash, he offered a guarantee to special revenue teams and reworked the schedule to stage 17 races despite travel restrictions. campaign to surviveMeanwhile, it has attracted more female viewers and young fans.

Reboot

Revenue jumped to $2.1 billion last year. The response to the pandemic has helped underscore the urgent need for change. The teams above the grid agreed to the proposal Liberty Media To divide revenue more equitably. Although opposed to FerrariAnd the mercedes And the Red BullAll teams agreed to limit individual expenses to $145 million, excluding marketing costs and pilot salaries. The aim is to ensure that bids are won with the judicious use of funds rather than unlimited outlays.

The new cars introduced this season make overtaking easier and should make racing more exciting. Criticism was drawn to the fact that previous cars caused “air pollution”: turbulence that made it difficult for drivers to get close to their opponents. Investors accept the view there is no. The new sports economy allows teams to generate profits rather than losses. In the past twenty months, Dorelton Capital Paid 152 million euros for Williams; IneosPetrochemical Company acquired a third of the team mercedes F1; investment companies MSP sports capital And the Ares Management they bought McLaren. Even big tech companies like The Google And the inspiration They sponsored the teams.

new teams

In 2026, Porsche And the Audibrands owned by the German car manufacturer VolkswagenYou intend to participate in the competition. “Right now, the core team is probably worth at least $500 million,” he says. there is no. “Maybe more than that, they’re probably rejecting higher numbers.” expansion in F1 In the United States with the Miami Grand Prix, it was added to a program that already included the United States Grand Prix in Texas. Additionally, the sport has reached an agreement to operate in Las Vegas starting in November of next year. With events in Brazil, Canada and Mexico already on the calendar, Liberty Media The number of races increased in an important time period.

“Don’t say no, but we don’t have any plans for any other events in the US other than the three already in place,” he says there is no. “Our main audience is in Europe… We recognize our heritage.” The benchmark for the sport’s success in America will be the new broadcast contract. current contract with ESPNthe American channel owned by Disney, has a single digit value and will expire soon. The value of the next deal with the United States could be between $50 million and $100 million, according to a person familiar with the broadcasting contracts. F1.

TV rights

“I think the next deal will be much higher,” he says. there is no. “Our growth in the United States is not over yet.” there F1However, it has drawn criticism for its expansion into jurisdictions that do not have a good reputation for human rights, according to activists. The pilots discussed whether they should go ahead with the Jeddah Grand Prix in Saudi Arabia following the missile attack on an oil depot near the track in March.
(complete in financial times)

(Pictured the Grand Prix of Formula 1)

Facebook
Twitter
LinkedIn