The Roar
The Roar

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Testing times ahead for F1's new owners

Roar Rookie
15th January, 2018
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Sebastian Vettel. (GEPA Pictures/Red Bull Content Pool).
Roar Rookie
15th January, 2018
2

Liberty Media begin their second year as Formula One’s owners with a massive challenge ahead of them. They have invested $8 billion and upon completing their rookie year there were signs we should look forward to 2018.

Gone are those ridiculous grid penalties, shark fins and T-wings. We still have those funny coloured tyre sidewalls though.

Mandatory for 2018 is the halo cockpit-protection structure. The French and German Grands Prix are back and 2018 will equal the 2016 season as the longest season in history – oh, and we have a new logo.

Regardless that they ran a loss in 2017, Liberty’s first-year report card seems above average. Their confidence boosted with an eight per cent increase on 2016 attendance figures – an extra 4 million fans attending the 20 races in 2017.

However, Liberty’s confidence took a hit as it got a firsthand lesson in figures clouded with controversy. It was found some promoters submitted inflated attendances to represent huge increases at their race – Azerbaijan, for instance, enjoyed a 138 per cent increase in numbers compared to 2016, but once all the figures were adjusted, this dropped dramatically to 58 per cent.

Again, in typical style, the explanations for this and many other discrepancies were dark and confusing, beginning with the formula used to measure the 2016 data becoming obsolete at that season’s end. The new method for measuring 2017 data interpreted the data using a different formula favouring positive results for the promoters.

Liberty are acutely aware of races, like Azerbaijan, being held in countries where motor racing is scarce, simply buying their way onto the calendar by paying a big fee.

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With collective hosting fees contributing to over 30 per cent of Liberty Media’s revenue, you could argue it would be in their best interest to retain these, and seek more, races for these big fees. Well, refreshingly, Liberty has the fans’ interests and the sport’s image at heart and find this practice contradictive to their plans to excite.

Their ideology is finding countries that have a history in the sport, which should prove easy, and will allow them to host races at discounted fees. This, Liberty feels, will rebuild the sport’s image while benefiting all three parties: Liberty, promoters and the fans. It may take some time and we may need to be patient, but Liberty is in it for the long haul.

Within the establishment, Liberty haven’t been afraid to put teams on notice, with cost capping and equality seemingly inevitable. As these measures will compromise team payments, it appears not everyone wants to play.

Ferrari’s Marco Mattiacci, echoed by Mercedes’ Toto Wolff, has said if Liberty choose to go down these roads then maybe F1 is not in their plans. Both teams stated they don’t need F1, leading to rumblings of a breakaway series.

Red Bull’s Christian Horner’s comments relating to the cost capping refers to the inability to police such a measure. These comments are born from the legacy of Liberty’s predecessors, where favouring established teams had been a priority.

It’s not surprising these three teams topped the payment list for 2017. If you were to study the extraordinary complex system used to decide team payments in this distribution – totalling $986 million – the imbalance is outrageous.

In any other performance-based reward system, you are permitted to think it inconceivable for a competitor preforming lower in the final standings to earn more than a higher performing team. But not in F1.

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Ferrari finished second in 2017, yet topped the list, earning $180 million. Mercedes, champions for the past four years, received $9 million less, with Red Bull rounding out the teams to receive over $100 million, with a payment of $161 million.

Spare a thought for Force India, they finished fourth in the Constructors’ Championship and received $72 million – $25 million less than McLaren, who finished ninth, good for second last. What’s more, Ferrari’s bonus payments were more than Force India’s $72 million performance-based total payment.

Four teams – Ferrari, Mercedes, Red Bull and McLaren – all received a Constructors’ Championship bonus, a guise for separate agreements with F1, averaging $35 million. Haas received $19 million in total. Ferrari received an extra $70 million for, well, just being Ferrari.

With such a system it is clear, and has been for a long time, why smaller teams fall off the back of the grid while the larger teams maintain a solid foothold.

The problem for F1 is this has rendered the sport boring, with Liberty now chartered to rectify this conundrum.

The next three to four years are a pivotal period. The existing contracts conclude at the end of 2020 and Liberty Media, we hope, will have a blueprint for the next chapter, creating a greater spectacle.

Liberty appear to have a different view of the sport than their predecessors – something F1 is not used to – with a can-do attitude, being unmoved by Ferrari’s threat to quit.

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To bring what is needed to have the premier open-wheel series in the world, Liberty will hold all concerned as equal and won’t bother who stays or who goes.

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