A significant milestone

The date: Friday 29th July 2011.
The location: Budapest.
The time: 07:00 UK.

The press release went out. The paddock left to clean up the mess, as the fans looked on in shock and disbelief. “BBC TV and Sky Sports have been awarded the live rights to Formula 1™ between 2012 and 2018”, were the words at the top of the press release.

It was something that the majority of Formula 1 fans in the UK feared would happen. The move was a result of the licence fee settlement the previous Autumn, which meant that the BBC had to tighten budgets in all departments. It was either Six Nations, Wimbledon or Formula 1 that was going to be chopped. Axing Wimbledon or the Six Nations, both of which have been BBC staples for decades, would have been extremely controversial, especially when you consider the number of people that play tennis and rugby at grass roots levels.

The axe swung towards Formula 1, as the BBC entered a deal with Sky Sports. The move was controversial, more so considering that the sport in the UK was at its peak in popularity. Despite Sebastian Vettel’s dominance, the majority of races in 2011 peaked with over six million viewers. Since then, numbers have dropped. When Formula 1 bosses wonder why some fans are more vocal than previously in relation to the current on-track product this season, I’d give the same answer that I gave to BBC’s chief F1 writer Andrew Benson on Twitter: “People are more likely to complain about something that they have to pay for rather than something that is free to air…”

So, why did the BBC go into allegiance with Sky and not another free-to-air broadcaster? Unfortunately for BBC, ITV had already allocated budgets for 2012 to cover the European Championships, and therefore could not be considered. Channel 4 were also not considered, despite their interest in securing the rights. I mention this in light of yesterday’s news that the Six Nations rights will be shared between BBC and ITV from 2016 to 2021. There are some similarities between the two, but also some interesting differences. The main similarity in both cases is that the original BBC contract ended early. For Formula 1, the BBC contract was originally 2009 to 2013. BBC renegotiated the contract in the middle of 2011. BBC’s current Six Nations contract was scheduled to last until 2017, except the shared offering with ITV means that the new contract will begin with immediate effect. The reasoning though is different. BBC were always going to get into discussions with the Six Nations Council at this stage it appears. However, Sky Sports also tabled a bid, which led BBC to go to ITV, tabling a joint bid to knock Sky off to stage left.

The key difference between the F1 situation and the Six Nations situation is that the BBC were able to bring ITV as partner on board for the rugby, which they couldn’t do for the F1 due to the point made above. The benefit of any joint BBC and ITV bid is that it is far more compelling for a rights holder to accept a joint bid from free-to-air broadcasters than a single one from a pay-TV broadcaster given the extra exposure that it would bring to the championship. However, BBC were left with no other choice. Had they not gone into partnership with ITV, then they risked either losing the Six Nations completely or needing to go into partnership with Sky Sports. The reaction to the last partnership would be a lot more volatile than the former option…

We’re half-way through the current Formula 1 contract. What happens next? For the next six to nine months, nothing. As mentioned earlier, the current contract between BBC, Sky and FOM runs out at the end of 2018. With the recent licence fee settlement that played out earlier this week. At the moment, no one knows what BBC Sport’s budget will or will not be in the years to come, but one thing is for sure, it will be lower, hence why BBC could not justify outbidding Sky for the Six Nations. The situation is complicated, and there are a lot of different factors that come into play. Do BBC and Sky want to continue their existing relationship? Or would BBC prefer to be in partnership with another free-to-air channel? And where does BT Sport fit into this, if anywhere?

My gut instinct tells me that the deal will be renegotiated before the end of the contract. By renegotiation, I do not mean BBC pulling out the contract. What I mean is BBC and Sky renegotiating their existing contract, in order to extend it to around 2021 or 2022. This assumes that the BBC are happy with the current product, the current viewing figures, what they are currently paying compared with what they are getting and whether they can afford to pay that much. If BBC cannot pay that much, could we realistically see a situation where the BBC only broadcasts only the British, first and last races live? I don’t know. But I definitely think the current deal will be renegotiated early, from the BBC’s longer term perspective that probably is the best option rather than letting the contract run until its end. It would also be to Sky’s benefit as well, as it would mean that BT Sport do not get a look in. Running the contract to the end risks BT Sport and Sky Sports fighting over the live contract alone, should they wish to. However, it also depends whether FOM wishes to take the money or the viewers. As motorcycling fans will know, we’ve been in this position before.

ITV’s F1 contract was meant to last until 2010. They exited in 2008.
BBC’s F1 contract was meant to last until 2013. They renegotiated in 2011.
BBC’s and Sky’s current F1 agreement is meant to last until 2018. I suspect 2016 will be a very interesting year in F1 broadcasting…

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11 thoughts on “A significant milestone

  1. Agreed it’s likely, The BBC have cost considerations and Sky (since BT appeared on the scene) have been keen to renew contracts early e.g. football league and the SuperLeague, although the latter wasn’t met with universal approval,

    http://www.theguardian.com/sport/2014/feb/04/marwan-koukash-salford-rfl-sky

    I do wonder though if the BBC will have the clout still they’ve already committed to MoTD and Wimbledon is due for renewal from 2018. There’s also the Olympics post 2020 to consider longer term. I guess savings from the Open Golf and 6 Nations and the Diamond League deals (although the latter must be relatively small) can be put towards keeping F1.

    That said everything depends on what exactly Tony Hall’s backroom deal with Osborne and Whittingdale will actually do to their budget.

  2. I’m beginning to get to the point where my F1 viewing is irrevocably ruined, never to return.

    If I had to score the Jake Humphrey’s era BBC coverage as a fan, and as someone who works in television, I’d probably give it a 6-8/10.

    Sky’s coverage has averaged a consistent 3-4/10 as it has fundamental, core problems that they have clearly decided don’t need addressing.

    The current BBC product bounces between 4-6/10 so although slightly better than Sky is still poor compared to the Humphrey’s era.

    I think the future plight of UK coverage is becoming a moot point as we are no longer talking about getting watchable, quality coverage but rather where can we see the basic world feed with interruptions.

  3. I would like the see the BBC go it alone if I’m honest, But the chances of that happening are very slim. Jake Humphrey’s era was by far the best F1 product form a broadcast perspective mainly because of the chemistry between DC Eddie and Jake. Also due to the fact that all 20 races were live and that Jenson Button won the would championship during that era. The BBC as a origination has far to many layers of management that stops the true creative people from rising to the top.

    I realised this a few months back when I went for a job interview at the BBC, Management had clearly ran out of ideas so were using people in their early 20s to generate them. If it was down to me sport as a product would have a permanent home on the BBC. Now BBC 3 is getting axed they should really take a look at what sport’s right they have a make a home for it. I have long said the BBC is fantastic value for money TV radio video streaming and now apps, People are paying Sky upwards of £75 per month and rising. The BBC should be allowed to charge as much as £200 per year for the licence fee, If it helps the corporation stay competitive and fend of the likes of Sky and BT then that’s what needs to happen.

    As for Sky the empire is solely starting to fall apart BT are growing at a incredible pace BT Sport is now in 5 million homes after 2 years since launch. It really wouldn’t surprise me if BT and BBC team up for the new F1 contract, similar to what they did with the FA Cup recently. Jake was spotted at Silverstone with some of his BT sport colleagues and fellow executives things are going to get interesting.

    Never liked Sky F1 and never will as long as Martin Brundle and Ted Kravitz are involved they sold the fan’s out when the left BBC F1. But also due to the fact that Sky still have adverts during the build up and post race, Sky must be making a loss on the channel because even with adverts they are lucky if 500,000 are watching.

    Whatever happens with the F1 contract I’m shore Bernie will get a good deal for FOM. I do wish Bernie would look at the global viewing figures for F1 before he let’s anymore Pay TV providers have rights to the sport because clearly it’s having the wrong effect.

  4. my interest in f1 is hanging by a thread. If it goes pay tv only for live race then my interest will be gone for sure. If we have the half race live again. I may carry on watching but my unoffical ban on buying off sponsor of f1 will continue.

    I use to watch motogband now i dont.

    I do find my self more and more interested in sports car and FIA wec now than f1. And this as increased now they are on free to air motors tv.

  5. I think many people are in the same position as Paul.

    We only have so much leisure time and disposable income. If you make it too hard work to follow a sport people will just give up.

    It only takes the lose of a few key sponsors and F1 will go the same way as CART.

  6. After the recent news of budget cuts at the Beeb I immediately thought we’ll see the dropping of F1 by them before the current contract is out. At best they will switch to highlights only.

    I don’t want that to happen but it will be interesting to see what happens to the viewing figures if it does, and the wider impact on a sport already seemingly lurching from crisis to crisis.

  7. As controversial as this may be I have to say that I love what sky offer as part of there coverage and am therefore glad they got the contract.

    been able to select from a bunch of different in-car camera shots, listen to the team radio feed on the pits channel and have the timing and driver tracking stuff available for every session on both tv, my ipad and previously my laptop has been awesome and its introduced another level of enjoyment into my f1 viewing.

    i know that the bbc had the main in-car feed and now have the pit lane, timing & driver tracker stuff… but until recently they only had them active for the race (now only qualifying/race) while for sky there there for every session and there are far more in-car camera feeds than what the bbc ever offered and unlike the bbc there also available on the red button tv and not just online so there faster/easier to switch between.

    i recall a few years ago when fom were using that helmet camera (what ever happened to that?) i was able to switch over to the sky red button & spend 10-15 minutes watching from that view during the friday practice, never would have been able to do that on the bbc.

    if sky were to lose/drop f1 and it went back to bbc, itv or whoever and we lost all these extra feeds it would be a big loss, especially if it was moved off the red button tv as its fun switching around the other feeds on there while just sticking the main in-car-mix on my ipad and leaving it to watch alongside the tv.

  8. i am not really sure how sky make money from f1 as they don’t appear to have enough viewers. Maybe they will take view its not worth it? Running channel 24 /7 for 1/2million viewers every 2 weeks in summer must cost. And all these extra fancy view angle must cost to, all the presenters they have at least 8 must cost?. How much do they pay martin brundle? 1M? that’s lot off sky subscriptions needed to cover that?

  9. For me sky coverage is far superior and someone i know who works for sky says sky are very happy with the viewers and their reaction to the coverage
    watched some of the bcc event after the live weekend on iplayer, not impressed, coulthard seemed to be at a loss most of the time, shame as he is the best they have
    bbc sport is looking very old fashioned and stuffy these days
    just watched the golf and its like an old boys 80 -90 year old club compared to sky and the us golf coverage
    do see the bbc exiting f1 soon unless they can open up the papers rumoured sponsorship or pay deal for sport and drama content
    its not as though we do not all pay for some content these days, online sporting website, a sports app, netflix, amazon, sky, now tv, bt sport etc

  10. I have to agree with Paul and Jess but for different reasons.

    Paul, based on an ‘eye’s on screen’ rating I can’t believe Sky are happy, the cost Vs viewership must be appalling.

    Jess, Sky may well be happy as F1 has been another sales blackmail tool to drive uptake and upgrades. I myself would never have upgraded from the basic Sky package had it not been to watch F1.

    The issue is that they’ve now had, and run out of, any new custom generated by F1 and it’s now a commercial millstone.

    Let’s hope they drop F1 and someone else picks it up. Investment is no guarantee of quality.

    If you look at the output on NBC courtesy of the excellent Jason Swales (ex 5Live), for a fraction of the budget Sky waste, it’s easy to see that money does not equal quality or passion.

  11. I don’t think its just the cost now.

    I started watching f1 late 1980s. I loath the qualifying rules . i always liked full hour with super sticky tyres, i hate the fact they have butchered hockenihem and now mexico track , i hate mordern f1 tracks like abu dhabi and others, To many tarmac run of areas, I don’t like the limited engine miles they have to do as avoid practice laps now, Not enough cars , no chance off fixing engine if its badley design because tokens system. , Tyres that fall apart after 15laps. no tyre competition. no car going for race with no stop compared with car who would do 4.

    you cant even buy grand prix pc game by codemaster because microprose grand prix 4 and grand prix legends are better games and they are years old.

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