In the battle for F1’s soul, Liberty Media have taken the money

Saudi GP

In the battle for F1’s soul, Liberty Media have taken the money

Morals don't matter on the bottom line.

Paul Macdonald

Sunday 11 August 2019 08:30

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It's a rare thing. Liberty Media own Formula 1. But do they even know that much about the sport in which they invested?

Their controlling stake, taking over from the plutocratic reign of Bernie Ecclestone, came with much fanfare and many promises.

But so far most fans of the sport would call their supposed innovations a monumental let-down; despite a recent revival, things are as predictable as ever.

And the rumours circulating that a Saudi Arabia race may be added to the calendar in 2021 strikes of utter desperation. It represents the bravado of a company that thought they were investing in a licence to print money, but ultimately their own abject failures have led to contemplating a relationship that should be unpalatable to pretty much every decent sports fan - or person.

A few months ago, we compared F1 to the WWE in a number of ways. We weren’t kidding, and the Saudi news is simply another direct comparison.

WWE owner Vince McMahon spent time and effort in developing women’s wrestling, only to sell it all out for a massive payday in Riyadh. Not only were the women prohibited from competing, they weren’t there at all. A gargantuan PR disaster, offset by unimaginable money, meaning they don’t have to care all that much. Football is no better, either, with Spain's La Liga relocating their Supercopa tournament there from next year, as well as the disastrous upcoming World Cup in the equally dubious Qatar. Rather than learn some moral lessons, F1 seems intent on treading the same path.

Let’s start at the beginning, and Liberty’s takeover. Chase Carey, the week the keys were handed over, is on record as saying it would be ‘straightforward’ to secure better sponsorship deals for F1 than Ecclestone had managed. It was brash, and it was flawed. Fast forward a year:

"The perception was just there are sponsors waiting. They were lined up out there and as soon as we had somebody to go call on them, they were just going to sign up. The world’s not that simple," he said.

And it’s not just branding he has found difficult to handle, but the circuits themselves.

Liberty’s desire to add another US-based race to the calendar surfaced when a deal was almost struck with Miami, only for local residents to protest vehemently and postpone the idea for now. But within that negotiation it was made clear that Liberty were willing to waive any race fee owed by the hosting city in order to secure the deal - a fee that a number of other venues pay in the tens of millions.

And with a number of key international agreements having been up for renewal this year - Britain, Germany, Spain and Italy among them, contributing on average £22.5m each per annum to F1’s revenue, their negotiating position was instantly compromised. Put simply, F1 is likely to earn less in the future from the same collection of races as Bernie earned in 2016.

A revenue gap needs to be filled and whenever that happens, a brutal dictatorship looking to launder its image inevitably appears on the horizon. F1 is already in Abu Dhabi and Bahrain, with serious reservations about the latter regime raised again when resident Najah Yusuf made an embattled plea for Liberty to understand the kudos their presence gives those in control.

A spokesperson was notably non-committal: “Formula One is committed to respecting internationally recognised human rights in its operations globally. As part of our commitment we expect that commentators who may wish to use the occasion of a Formula One grand prix event to express opinions peacefully will be able to do so without punitive action, before, during or after the event.”

Funny, that, because F1 have allegedly sought ‘reassurances on issues including human rights, gender equality and media freedom’ from Saudi Arabia before a deal will be done. Again, it’s just lip service. It has no real foundation in anything and it merely represents a response of some kind, a pyrrhic victory at the expense of the sport’s soul.

Sky's F1 coverage making Liberty's Ecclestone curse worseRead more

Liberty Media's huge losses - what does it mean for future of F1?Read more

Times are changing, and F1 is trying to change along with it, but in none of the right ways. Liberty tries to launch a broken OTT product online to allow more users into the sport, but while domestic TV rights are decimated at the expense of archaic pay-TV models. They show progressive thinking by removing grid girls, then sign huge betting sponsorships in the next breath. And they propose to be open and inclusive for all, and yet will head to a country where women were prohibited from driving at all until last year.

It is a company at odds with itself, trying to do what it deems to be the right thing, to show corporate responsibility, but that commitment only stretches as far as the bottom line. There’s another investor call coming. $FWONK stock needs to be rising. And in the end, we shouldn’t really be surprised.

Just disappointed.