Two comments in the past few days have raised my eye-brows and got me thinking a bit when you think about the current UK F1 television landscape in relation to the current situation we find ourselves in. The first is a comment from Ben Anderson on the AUTOSPORT website:
“It also doesn’t seem fair to try to squeeze more money out of TV companies and race promoters at a time of falling audiences and race attendance.”
The second is a comment from David Emmett, a MotoGP journalist, in a conversation I was having with him and a few others on Twitter last night:
“Not sure there’s as much room for Bernie to try to push TV revenue.”
The UK rights were negotiated in Summer 2011 as BBC renegotiated their existing deal, to bring Sky Sports into the picture to what we have now. As discussed earlier this year, the F1 rights currently are in the region of £55 million per year. Since 2011, BT Sport have entered the picture, and the cost of some rights has frankly entered the ‘silly’ territory. BT Sport paid £299 million per season to screen the Champions League from 2015-16. That’s absolute insanity. On a smaller level, MotoGP’s value multiplied several times over when it went from the BBC to BT Sport.
My point being that, with Formula 1 rights on lockdown until at least the 2019 season, FOM are losing a ton of money at the moment. If you renegotiated the rights today, or sent them to the market, in my opinion the rights value would easily head skyward of £100 million per year, probably near £200 million. And when you consider that it costs £75 million a year (based on current conversion rates) to run an F1 team, the £100 million difference between the current rights fee and what it could be in a hypothetical situation, FOM is missing out on a huge amount of money.
Of course, with any such increase, you can kiss goodbye to any terrestrial television coverage. What we have now is the best of both worlds, even if FOM are being short-changed…