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29 Jul 2011

F1: Bernie Ecclestone's great betrayal?

“Sky have been trying to buy the TV rights from us for a long time, but we won’t because they are not free-to-air broadcasters. With their viewing figures it would be almost impossible for teams to find sponsors. That would be suicidal.” - Bernie Ecclestone, May 2011.

Fast forward two months. 90% of Formula One fans are going to be forced to either pay to watch every race, or miss half of them. Bernie Ecclestone told us this wouldn't happen. He said it wouldn't make sense, the teams wouldn't like it, the fans wouldn't like it, he wouldn't like it. But here we are, faced with a choice between paying up or giving up.

Sky, the BBC and Ecclestone have agreed on a seven-year deal (2012-18) that will see Sky Sports broadcast every practice session, qualifying and race live and uninterrupted. The BBC will air just 10, including the Monaco and British Grand Prix, and the final race of each season.

Today, a customer new to Sky has to pay at least £40 a month for Sky and Sky Sports subscriptions, both of which are needed to watch every race live. Considering that on average there are two races per month, and as half are on the BBC, one of those will be free-to-air, you pay £40 for that one race each month. Such a great deal, according to Ecclestone.

Formula One is entering a dark time, it's popularity has grown and grown since the end of the Schumacher era, with the Championship battles in 2007, 2008 and 2010 going down to the final race, and 2009 being decided in the second-to-last race. 6.6 million tuned into the British Grand Prix, and over 8 million watched the rain-delayed Canadian Grand Prix. Both figures are 10-year highs. The German Grand Prix this year drew it's highest audience in 15 years, and the BBC have given that up to save money.

The BBC have done this in the name of 'cost-cutting'. This is the same BBC who sent over 400 reporters and technicians to Glastonbury Festival, the same BBC who sent 250 employees to cover a 1-day event marking one year to the 2012 Olympics. Sky, with a hundred times the budget, sent 11 people in total. The corporation pays Chris Moyles and Jeremy Clarkson £6million a year. All of this is funded by the license fee, which is used to "fund" the BBC. Most expect that to mean "paying for bringing us programs." Obviously not.

This letter appeared in a major UK Newspaper not to long ago, and sums up precisely why Formula 1 should appear on the BBC:

"What other international sport has two recent British World Champions competing in a British team? What other sport has a hi-tech support industry centred on Britain? What other sport has two thirds of the international teams choosing to base themselves in Britain?
 What other sport is the pinnacle of an industry estimated to be worth £5 billion a year to the British economy? What other sport has as many Brits in key positions in foreign-based teams? What other sports is associated with cutting-edge engineering, and is a stimulus to youngsters to enter engineering? The BBC should feel a patriotic duty to broadcast Formula One."

Fan reaction so far has been overwhelmingly negative:

"Not impressed."- Martin Brundle

"F1 on Sky is a joke! So much for the sport's own rules. If the money is there then the rules go out of the window"

"F1 has won many new fans because of the BBC F1 coverage the last few years, the new deal will loose those not prepared to pay" - Sir Stirling Moss

"I can't afford Sky TV let alone a sports package on top, unfair, I feel cheated."

"I can assure you that I won't be paying for Sky. This is awful."

"I can't afford Sky, so that will be the end of 12 years of watching Formula One."

There are rays of hope for people opposed to this deal. Some fans have raised the legality of the deal, and teams are confused over what the benefits actually are. The teams, FIA and Bernie Ecclestone have all signed the Concorde Agreement, a contract that determines the rules of the sport and how it is run. It states that Formula One should be on free-to-air TV until 2013, which was when the original BBC contract was due to expire. The deal could be in breach of that aspect of the agreement. Several people have pointed out that teams must be consulted before any new broadcasting deal is agreed. The surprised reaction from many teams suggests that this has not happened. A couple of teams have questioned the benefits of the deal. Sponsors pay for the right to advertise on the cars. They are much happier paying for sponsorship of a team in a free-to-air sport. The sport going to pay-TV means that sponsors must pay even more. Along with this hit, less people will be watching on pay-TV as not everyone can afford it, this results in sponsors paying more for less exposure. Many would simply walk away from the sport, leaving huge holes in some budgets and causing other teams to fold altogether. Teams such as Virgin, HRT and Williams rely heavily on sponsorship deals to balance their books.


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