I hadn’t read the musings and thoughts on the rumored Apple-to-buy-F1 deal but thanks to reader Gjermund, I was sent a link to a Fortune story by Don Reisinger quoting Joe Saward. It was a circuitous route to the story but I did read it.
Don brings up very thoughtful points and so does Joe per Don’s paraphrasing. All of that is covered territory by both gentlemen so I won’t regurgitate it rather leave you a link to read for yourself.
What I did want to discuss is the notion that Apply buying F1 would make sense on two fronts according to both Don and Joe. Coupling their current move toward making a car (which Elon Musk said is happening) and also selling more Apple TV units to fit in their comprehensive programming package they are working on.
Joe and Don are spot on from an Apple TV perspective and while they are right about selling more Apple TV units, that’s not the real key here—it’s the recurring revenue from a monthly programming package that is the big rock.
If you were Apple and you wanted to create a new Apple network of programming content, imagine how difficult it would be to get NFL, MLB, NASCAR or other prime sports. They’ve got the money to buy those broadcast rights packages but would they be able to given that NBC, FOX and other broadcasters would be very much against it. Apple could negotiate it, for sure, just like they have with their music and they have the cash to pay a very high rate. BUT…
What if you could acquire F1 which has an outlandishly higher viewership than other sporting events hovering around 400 million per year? What if you just bought the entire series with all its broadcast rights for the next 90 years? It would be like Apple buying the NFL, BPL or the Olympics. The total viewership of F1 is a major factor and could be very compelling for Apple to buy as a keystone to their global programming package. It’s huge is scope but is it possible?
The tie-in for their future car that Don and Joe refer to is more difficult for me to find compelling reason for. It would make more sense to acquire a team like Sauber and use that as a way to get their feet wet in F1 prior to going all in. As Don says in the article, they would buy F1 for their car program but wouldn’t it make more sense to buy a team for their car innovation and not the entire series? Perhaps they could be thinking of both buying the series and running a team which would make more sense to me if they truly wanted to use F1 as a proving ground for rapid prototyping and innovation.
Apple would also find some engineering innovation in the realms of design, electrical, mechanical and even exotic raw materials. This would play well with their design department in pushing the limits of materials, design, packaging and innovative technology evolutions.
One of the things about Apple is their approach to controlling the software and hardware. A well-documented and main difference between Microsoft and other. Some hate it and feel that Apple has a very Byzantine approach to their users but you also have to take the user experience in to account prior to rushing to judgment.
By owning and controlling the software and hardware, they can design a complete user experience and ensure it remains as positive as possible. Something like adding a USB jack to an iPad would open the unit up to driver issues, firmware and corruption issues and offers a chance for a breakdown in the user experience.
Apple could take their F1 programming and deliver what I have been asking for yesterday in this article about Virtual Reality and F1. Forget VR and create a more robust programming experience with content including multiple camera angles, streaming data that the teams see, FIA communications, radio communications and more to resemble race control via a single or two-screen experience. Apple could deliver this through all of their products.
I’ve bemoaned the lack of technology and Silicon Valley investment in F1 sans tobacco money for the last 10 years but perhaps one of the biggest players in Silicon Valley could be set to even surpass my simple idea of sponsoring F1…by actually buying it. Who knows? We’ll see.