F1 technology upgrade contest- Is Google, Apple invited?

It’s time to upgrade Formula 1’s live data screen and why not? It’s been the same for decades. In a new initiative from F1’s technical partner, Tata Communications, the Connectivity Innovation Prize was launched last month and has a $50,000 prize for the winner.

Entrants in the competition can work with the data and also the GUI as well as UX or user experience in the look and feel of the new data screen. They can also consider possible TV graphics incorporated in the system as well.

According to Christian Sylt at Forbes, this contest is the first in three tests to improve the technology the teams rely on to develop their race strategy.

“The live data screen has remained the same since the 1980s and is highly complex, purposeful and powerful in its ability to deliver multiple data requirements in real time. However, there is an incredible potential to gain even deeper insight from the session timing information including proposed race strategy and the current car performance,” said Mehul Kapadia the managing director of F1 business at Tata Communications.

The issue at hand is data and the data sources that harvest this information. Kapadia reckons the way in which users consume this data is a critical reason for improving it:

“Today, over half a billion people watch each season and millions keep up with each race using web-connected devices. Due to the technological advances and explosion of data, the sport is now in an era where there are more data sources available than ever before.”

A key takeaway here is that Formula 1 isn’t driving a conversation on improving their technology and race data interface. It is a sponsor of the sport that is trying to create an innovation block within a sport it is sponsoring. That may, on the surface, seem innocuous enough but if you consider this closely—why does it take a sponsor to lead the innovation and technology evolution of the world’s most advance form of motorsport?

Surely F1 has its desires and plans for technology innovation? Perhaps not if Mercedes boss Toto Wolff’s recent comment to AUTOSPORT shed any light on the situation:

“I had quite a long row with Bernie in a meeting,” said Wolff about Ecclestone’s dislike of social media.

“We were talking each other down again and saying, we have lost 30 per cent of TV audience in Italy and we have lost some of the audience in Germany – although interestingly the UK is growing.

“Then you wonder why the audience is not growing and is diminishing if you sell the rights from free TV to pay TV. That is completely normal.

“But the other thing I mentioned was that we are having such an explosive growth in online activities – before Bernie said, ‘those guys are not paying and half our profit is TV.’

“Sure the [social media] model does not work yet as you cannot monetise it, but I can tell each of my sponsors that the audience seeing his logo is growing even though TV figures are down.

“Even the big players like Twitter have not worked out how to monetise it, but it is just a matter of time before we do that.”

You may feel that F1 should fully embrace social media, offer content for free on YouTube, Facebook and Twitter and produce content that everyone can enjoy without paying for it, the reality is that doesn’t pay the bills and the teams are reliant on TV revenue.

While Wolff can suggest that embracing social media will offset the loss in content monetization—such as the current F1 business model—in new sponsors and increased sponsorship, I find that a huge gamble and risk.

The reality is that TV revenue is more directly tied to the F1 audience than potential sponsors of, say, Marussia or Caterham. Broadcast companies have a keen interest in purchasing the broadcast rights for F1 and the content F1 generates has value. If you give all of that value away for free in the hopes that a new sponsor will support a team because their logo is seen in a Twitter feed, I think that’s narrow minded and falling for the shiny lights of overblown social media propaganda.

The simple fact that fans are digesting sport and entertainment in a different way isn’t a reason to immediately dump your content for free to the world. The fact is, F1 is a for-profit business and if I were Mr. E, I am not so sure I would simply fold like a chaise lounge on the issue of social media just because “everyone’s doing it”.

Color me reactionary but I am still bereft of the monetization model of Twitter or Facebook. The main people making any real money in these social media platforms are the owners of those platforms, not the content generators for those platforms. Until these platforms can show serious revenue models for content producers, I think it is prudent to tread lightly until convinced. Right now, Mr. E isn’t convinced and I am inclined to agree with him.

The backbone of these platforms and their revenue model is really boiled down to ad revenue. That’s it. F1’s broadcast package is content sold to broadcasters who then sell time for ad revenue. How do the two models combine to make a harmonious marriage between social media and F1? I’ll let you decide but I am sure that Mr. E feels that Facebook or Twitter is no different than NBC, Sky Sports or BBC in that if they want the content on their social media broadcast platform, then they can pay for it.

Consider it this way, Sky Sports purchased the F1 broadcast rights and then sells ad revenue time during their broadcasts etc. What Twitter, Facebook or YouTube are doing is positioning themselves as Sky Sports or BBC or NBC but they want the content for free and then they’ll sell ad space and make money. While the world may be fine with generating content for them for free, F1 is not and nor should it be.

Last year I spoke with Ferrari’s head of marketing, Stefano Lai, and he made the simple observation that social media is a new form of communication not unlike TV when it entered the world or radio when it was created. He’s right about that.

Monetization models soon developed for these legacy mediums and if social media wishes to survive, the onus is on them to create a business model that works and isn’t reliant on producers of content to give away their products for free. It’s not a new issue but there are lessons to be learned on both sides of the argument.

In their defense, Ferrari’s Luca di Montezemolo did call for an F1 summit around the Italian Grand Prix and suggested the sport invite Google and Apple to the meeting to try and get on top of the technology question. At least they are trying…sort of.

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