Carey’s 4-prong TV attack plan for F1

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Photo by: www.kymillman.com/F1

I’ll be interested to see what revenue streams Formula 1 can create given the recent comments—since acquiring the series—that Liberty Media’s boss, Chase Carey, has offered on long-term growth versus immediate gains.

Since buying F1, Carey has said they are in it for the long term and says they are energizing and growing the sport and getting smart about social media and they even created a fan zone where you can change tires on a car—you know, like they’ve been doing in NASCAR for years. Carey said that European races are the main focus and with France and Germany returning, he seems to be on target.

Now Carey has spoken of the challenge—we’ve mentioned many times before—over television broadcast rights. National broadcast packages are important to F1’s revenue and as we’ve argued, you can’t ignore them or simply suggest that F1 go digital streaming only. Carey discusses the four concepts he sees:

“In terms of the television arena that we deal with, I guess the way to describe it is that there are three or even four potential arenas that we are engaged with,” said Carey.

“Traditional free, pay, digital, and then our own probably more direct ‘over the top’ product.

“To some degree what you have is conflicting goals across them.

“Probably the economic premium paid gets higher as you go up the ladder, but the reach gets less.”

The challenge is the retain broadcast rights packages for free and paid TV but to introduce digital packages for cord-cutters and apparently and over-the-top package but I’m not sure about the details of such a package.

There are sponsors and teams to consider as well as advertising and the fans. It’s a complicated mix but the former owners of F1 knew where the revenue was and did the best broadcast deals they could.

“We’re trying to balance what is the right mix of reach and direct economic value,” he said.

“Clearly there are impacts on other partners we have – for sponsors the fan engagement is obviously very important.

“For us the goal is to maximise long-term growth, not to find a short term pop.

“If you’re energising the sport we want to make sure we continue to position it for long-term growth that finds a balance between that reach [and money] as opposed to just where you can get the biggest buck?”

Once again, there seems to be a dig at former F1 boss Bernie Ecclestone in the Autosport article and Carey’s commentary. It is those biggest bucks that have kept the revenue stream flowing and the teams paid the prize money for which they have become very reliant sans sponsorship. I understand his point, I’m not digging at Chase on this but I’m curious in that European race (lower sanctioning fees), cheaper tickets, more digital TV models and other “long-term” concepts while spending more on marketing F1 through London Live and the Fanzone stuff, how will all this play out in total revenue split with teams?

It’s an interesting series of objects he’ll have to juggle but one that I will be very curious to see done. Here’s hoping he has a great plan and everyone benefits.

Hat Tip: Autosport

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Tom Firth

So F1’s broadcast strategy is now being talked about, the same way as other major US & global sports. Good.

Negative Camber

In some ways, I think the US model is all about reach whether that be through current NBC broadcasts as well a digital etc. It seems to be fine with NBC but it is through their platform (NBC Live Extra). Wonder how they’d feel about an independent F1 streaming option along with their investment, though.

Tom Firth

I think what would likely happen regarding the streaming option direct from F1, would be probably have blackout restrictions, perhaps for the home nation grand prix or if it is on the OTA network or something, in line with what happens with other Direct-over-the-top packages from the likes of NHL, MLB etc in the USA, which would protect their investment for the events they prioritise during the season. The NHL model is very, very close in fact to what Carey is proposing as it shares the same network to F1. Select Games on NBC – Traditional network Games on NBC… Read more »

Tom Firth

Sorry, I wrote way too much on this.

Salvu Borg

no you did not, at least not for me, ready you was interesting.

Gordon Mann

I just hope they don’t screw the fans the same way as Indy Car does by limiting the extras to a specific carrier. I would love to buy the full coverage offered to the 25% of the country through Verizon but there is no way I would switch from ATT.

Please make any extras available to all the people.

Schumi Toronto

I would probably be interested in the “over the top” package, assuming it would be an F1 dedicated channel, showing the races commercial-free, maybe even being able to pick any car’s in-car footage etc. as well as showing old races during non-race times. However I can imagine the price tag being $500 plus! I’d love to have it, but not at that price!

Jimmy

That’s exactly how I feel about the NFL’s redzone/gameday package (or whatever it’s called now). When I had a year free after signing up wtth Directv, it was great. But the next year it would have cost over $600. At least with that I had all of the games, every week to watch. It still wasn’t worth it to me. While a similar service providing F1 coverage would be great, for a price tag like you mentioned, and with much less content over the course of the season (ie 20 races vs 10gamesx16wks), it just doesn’t make sense. Plus if… Read more »

charlie white

I read this story on a few other sites. UK fans, in particular, were concerned about the potential end of free over the air F1 broadcasts as Sky may take it completely inside their walled garden in the future with a exorbitant access fee. For US fans, we only get 3 races(USGP, Canada & Mexico) free over the air per season and that’s not guaranteed in some markets as some NBC stations either pre-empted the race for local church/public affair/infomercial programming. And I won’t go into CNBC/NBCSN issues variables on some cable operators. I’m curious to see what the “over… Read more »

Tom Firth

Sky are talking it inside their walled garden. It isn’t potential, it is happening, the deal is done for 2019. A highlights package may continue on digital terrestrial or one of the Sky more mainstream channels that has a larger reach than Sky F1 but the ‘live’ portion of F1 broadcasting in the UK will be exclusively Sky from 2019, ending the current 50/50 split with Channel 4 or whoever to show half the races live on a digital terrestrial channel ends at that point. The only exception to that is likely to be the British GP which will likely… Read more »

Barry

Considering the oncoming reality of climate change, the move to FE by major manufacturers, and lack of competitiveness in F1…I personally think F1 has put itself where it’s trying to climb a greased pole.

CARLOS PALOMO PUENTE

Bullshit! Merde! Mierda! When will they stop talking about how to make big bucks? Just give us some good racing, for Christ’s sake!

jakobusvdl

I’m sure that Liberty Media will come up with a hybrid solution that will suit progressive fans, and a lower tech n.a (normal access) solution for more traditional fans ;-)