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.
Hat Tip: Fortune and Joe Saward
I read the same thing and all I could think was this… pressure is building on Apple to repatriate all their foreign profits and pay taxes (pay back the US taxpayer for creating all the chips, plastic and screen technology in the first place). On the other hand, if they invested those funds instead of loosing them in US Tax…. and, yes, all the other advantages you cite. In the end, it’ll all come down to money, not sponsorship and certainly probably not innovation. After all, what has MS done to F1 or with F1? Ever seen any commercials or… Read more »
And Google and FB and Twitter and all of these social media and big tech companies.
Microsoft is an associate sponsor for the Renault team and past sponsor for Lotus.
Well, I believe it when I see it. :-) I don’t see the connection of Apple as car builder and owning the sport. Own a team, maybe, but then why F1? Formula E would be a more logical choice then. What is known: for years Apple is unsuccessfully trying to make TV content deals with cable providers. But not in order to sell their Apple TV (it is way to cheap to make a proper margin like with the iPhone or a Mac), but to get a cut from selling the content and lock users into their platform. But the… Read more »
Your last paragraph, I totally agree. The WEC feed is awesome and for a nominal fee I ran the 24 Hueres stream nonstop for 24 hours, with RLM commentary and a couple IRC chats. Just outstanding. The rest of GT racing is a headache: some YouTube feeds (e.g., Hankook24, Blancpain, GT Asia) and some VPN workarounds to Euro streams (DTM), and some direct from the series sites. It’s all very fragmented, and I’d pay handsomely for a single motorsport site that produces WEC-quality livestreams of GT and single-seater racing, including IMSA and V8 Supercars please. F1 is ironically the most… Read more »
Could Apple buy the sport? Sure, it’s sitting on $230billion in cash and it’s burning a hole in their corporate pocket. Between acquiring Tidal and building their iconic Spaceship headquarters in Mountain View, it could purchase F1 but why? No doubt the company wants exclusive content for its AppleTV platform but it could negotiate exclusive USA streaming rights when NBCSN’s contract expires this season’s end. Why buy the whole sport? All 3 major US sports leagues have some type of exclusive streaming deal. Tying this into the whole Apple car project is a huge stretch. After all, I don’t see… Read more »
The idea sounds far fetched but if we’re running with it, then here it goes; My fear in Apple ownership of F1 is Apple imposing its vision of what cars should be through F1. Granted, we don’t know what that is, I just don’t want something even approaching the Google car. But if F1 influenced its new overlords in the design of the Apple car, well that sounds exciting. Jony Ive and Adrian Newey working together = What Aston Martin supercar?
One thing’s for sure, If they buy F1 it would probably mean another 2 years before they get around to updating the Pro line of Macs.
and thank God for that
The three simple steps to a successful Apple F1 series.
Step 1. Purchase F1
Step 2. Put Steve Matchett in charge.
Step 3. Soak it all in.
And you think Bernie is too expensive now?
Investing in any sporting event without any interest in that sport seems like a disaster. It’s one thing to slap your name on a car or stadium, but actually running a series to the benifit of all concerned and make money. You better enjoy it because it’s going to be a lot of work.
Most Valuable Company on Earth – They probably understand.
On the face of it, I’d agree. That’s generally true. But CVC. As an enormously cash-rich company with multiple non-USA subsidiaries (taxes) and a demonstrable foothold in streaming media, Apple would be plausible. If there’s any truth to this story, Apple has already unleashed a horde of its financial analysts to dig into every possible financial and marketing scenario and to come up with one or more plans and to unveil the multiple risks. Any company that takes it on – and there aren’t many able to do so – will have to have streaming in its vision and willingness… Read more »
This is surprising. Netflix and Amazon streaming make sense, but the tech tie-in to F1 would make additional sense for Apple. Not that I think that would be a great thing, because it would mean a more defined trajectory to hybrid, electric, and autonomy (although it might take a decade), which is not something I’m pleased about with F1.
The last 4 paragraphs are the key. If Apple really wants to change the world of User Experience for sports, they NEED a showcase that they have total control over. Team ownership definitely wouldn’t do it, even “broadcast rights” wouldn’t necessarily do it. F1 is one of the few major sports left with what appears to be total control over their content, making it an easy choice for them IF they have that rabbit up their sleeve. Given their penchant for attempting game changing technology and experience, it’s not such a big stretch. Once the tech is demonstrated in F1,… Read more »
The idea of selling Formula
One to one of the the tech companies came to be after Alex Hint had published
the book, ‘Will Google Buy Formula 1?’ http://www.amazon.com/dp/B00JKGR3ZA
Hint also got in touch with
Bernie’s assistant and all of the team leaders. You can read some of the related articles at Paddock
Magazine http://www.thepaddockmagazine.com/?s=alex+hint