March 2008: The Malaysian Grand Prix Weekend

Britain wakes up to news that ITV, the current Formula One broadcaster for over a decade, has lost in the latest round of TV rights auctions to the BBC - with the latter securing a deal with Bernie Ecclestone to cover the series for around £40 million a year.

At the time many fans are delighted to see the sport move to the channel which first popularised it and the return of interrupted coverage. Others are concerned at the amount of money the Corporation was willing to pay to in comparison to ITV and whether it would have issues in the long term.

June 1, 2011: The Penny Drops

The Sunday Times publishes an article which reveals that the BBC is weighing up its options in regards to the future of its Formula One Coverage – with many within the operation looking to see it let go to save its other entities, including BBC Four. Understandably, the reasons behind this point towards the freeze in license Fee by the current UK-government, however it is no lie that the corporation had overindulged in many shapes and form and is resigned to cutting costs in some form or other.

July 29, 2011: The Hungarian Grand Prix Weekend

As British fans awoke excitedly for the opening Friday practice session they were greeted with breaking news that this would likely be the last Hungarian Grand Prix to be shown on free-to-air television for quite some time. After much speculation regarding the future of Formula One on the BBC, the Corporation has dropped a bombshell and announced that it has decided to forfeit its final year as exclusive broadcaster in the UK. Even more compelling, the deal will see Auntie lose the rights to cover every Formula One race live, with SkySports filling the void.

Under the joint agreement the BBC will continue to show a limited number of events – ten, including the British and Monaco races and the season finale – but will show the majority in highlights form with Sky offering multi-platform coverage of every practice session, qualifying and race.

As expected the news was met with much anger from British fans over social media, with many feeling cheated as they either do not have the means to access Sky or would want to pay for a subscription-based service. This is understandable as those with cable or satellite will know that access to SkySports does not come without signing up to an additional TV package in the first place. Even BT Vision requires you to take its phone and broadband options, plus a basic TV charge before paying an extra fee for access to SkySports 1 & 2.

So it is quite likely that Formula One fans will be forced to sign up if they wish to continue viewing the sport in its entirety. Obviously this will not suit everybody and the number of viewers will probably drop in the short term at least.

Only last week a number of sources had quoted F1-Supremo Bernie Ecclestone as saying that he wished for the sport to remain free-to-air. The reaction of many within FOTA (The Formula One Teams’ Association) also suggests shock at the deal. However it could be that there was no other option for Ecclestone to turn to – faced with the real possibility of the BBC pulling the plug altogether at the end of the season.

Although it has begun to turn profit, it is doubtful that ITV would have ever been able to afford a deal which matched the current fee paid. The same could be said for Channel 4 and Channel 5 who would appear to have even less access to monetary resources.

While it is not entirely the reason, the BBC’s decision to bid so generously back in 2008 would always come back to haunt them. As mentioned last month on GPFocus, the deal meant that free-to-air F1 coverage had reached the glass ceiling and would never be able to be the same. Subsequently this website speculated that either Ecclestone would have to agree to a smaller fee or that coverage would have to be broken up and shared, similar to the situation in other countries.

Sadly the latter was always going to be the option; as much as it pains the common fan, Formula One is primarily a business and projected revenues lie at the heart of this. With its initial bid, the BBC raised the bar to mean that a similar or higher fee would now always be expected by the commercial rights holder. Quite frankly, it was at this stage that the UK’s terrestrial commercial channels became priced out; none of them would see it as good business sense to bid that much on a sporting event – even F1.

Regrettably,  the recent austerity measures could not escape the BBC and it has to make the painful choice to give up one of its “Crown-Jewels”. As expected, the Corporation has attempted to window dress the deal and talk up its continued commitment to the sport, but this will not wash with many fans who will likely feel betrayed.

Ultimately the BBC is a body funded by the public tax payer. Although Formula One has brought them great success in its timeslot, it has an obligation to pander to the tastes of the majority and the minority –which makes it likely that its BBC Four channel will be saved.

This will not go down well with Formula One fans, but without the protection status of some sporting events, the BBC could choose to take this route if it wished.

But while the BBC is looking to save costs – according to The Guardian it will save around £16.5m a year from the new deal – Sky has warmly embraced the acquisition of the sport and cannot be blamed for doing so.

Regardless of the continuing scandals surrounding News Corporation, SkySports did nothing wrong in trying to wrestle Formula One over to its pay-tv format (to let your opinion on the former issue bear influence on the latter would be wrong at this time). The door was clearly opened for the satellite giant, and it duly took its chance. While Sky will likely receive a bombardment of cynicism the company has already committed itself to showing the races advert-free and have more than enough financial strength to ensure that the show is produced to the highest quality and that the best talent available is brought over.

On a side note it will be interesting to see if the BBC will use Sky’s commentary team for its highlights and limited live races and whether this changes the coverage for fans outside of the UK whose broadcasters use the British team on its own coverage. JamesAllenOnF1 has revealed that Martin Brundle is not under contract with the BBC and given the ex-driver’s reaction to the news on his Twitter, it would not be surprising if he is poached along with David Coulthard – with Sky surely seeing the duo as credible to selling its initial coverage.  Jake Humphrey is well and truly a BBC-man, primed to be the face of next year’s Olympic coverage and football down the line, therefore it would be hugely unlikely that he would jump ship and may actually be able to cover more events from next year onwards with the limited F1 schedule.

Consequently it would be assumed that Sky would likely parachute its own talent into the presenting hotseat. The most likely candidates would be Keith Huewen, current IndyCar and Goodwood FOS presenter on the sport’s package; Georgie Thompson, who fronted the A1-GP coverage and David Bobin, who often sits in on some of the IndyCar coverage, is a regular on SkySportsNews and has presented Silverstone’s trackside TV coverage for many years. Either way it would not be surprising to see Tony Jardine make a return to cover the sport in some form, given that he has worked for Sky for a number of years now on a number of its motorsport events.

Certainly the cricket and football world was up in arms when they first moved their big events away from terrestrial television, but it is likely that with the money received and growth experienced that they would want to turn the clock back. Formula One of course is a very different animal and it will be interesting to see what the Sky deal has in store for its continued commercial expansion.

While it is unclear if the deal will add any impetus to the mooted Exor/News Corp. takeover deal, it does pose an interesting question as to the regards of Formula One broadcasting around the world, especially in its key markets.

As said before, UK fans have been fortunate in the sense that they received the full package free-to-air. Fans in other countries have simply never had access to this and today’s news probably signals that they never will.

With around 180 countries currently showing F1, it is likely that many TV broadcasters will now find themselves resigned to similar deals in the future.

The only cause for concern is how F1 will now be perceived among viewers, especially in a few years’ time when the new arrangement has been accepted. With the BBC likely to try and take as many important races as possible, will this further increase the gap between the grandeur of each event? Will the world championship continue to be viewed as one entity to the common fans or will the overall series be side tracked by its ‘Major’ events – as has become the case with tennis or golf over the years? (Although it would be foolish to suggest it would ever become as extreme as this)

Another will be whether the deal breaks the free-to-air agreement which is locked into the current Concorde Agreement. It has been suggested that teams will meet with Ecclestone sometime during Friday in Hungary, but it is likely that the Englishman will justify the decision on the fact that coverage of the sport will be free in some respects and will actually be increased in the UK – not just on more channel, but a likely surge in press coverage in Murdoch’s newspapers.

Despite this it is likely that viewing figures will be lower for the Sky-only races and this may be a major cause for concern for the teams, with sponsors not gaining the same level of exposure as they have been used to.

However, once again JamesAllenonF1 paints a very mixed initial reaction from sponsors – on the one hand concerned with the fall in audience numbers, but on the other happy with a stronger commercial platform on Sky to advertise their products.

Sponsors already often receive more from the sport than they put in, but it is no lie that Formula One in the UK has relied heavily on a surge of interest from fair-weather fans, who came to the sport thanks to the success of Hamilton and Button. Undoubtedly, free-to-air coverage has been a big part of it, meaning that the big question will be if these fans stick with the sport and continue to follow it as vividly as before. Although there is a strong and knowledgeable group of fans in Britain the sport, as is the case all around the world, cannot rely purely on them to continue to grow and be successful.

The United Kingdom is at the very heart of the Formula One world and often it sets the example for the rest of the countries covering the sport.

The announcement of the deal could likely change the way the sport is broadcast forever, but it may also raise the political stakes.

Just how far the teams are willing to push their definition of free-to-air broadcasting will be revealed shortly – probably following today’s meeting. Even then it would be foolish to start suggesting that a breakaway series may once again be on the cards; there has already been a lot of water under that bridge and whilst not impossible, it is a debate for a different time.

Whether it will have an effect on the future of Formula One, the announcement suggests that television coverage is still paramount to the sport’s growth.

While it may be painted as a win-win by those involved, it will take time for these words to have any resonance with a fan base that is left shocked and dismayed by the deal.

But time often changes people’s views and it has been clear for some time now that Formula One is a business which will do what it feels is right for itself.

 

Did you like this F1 post? Why not share it:
 

5 Responses to Pondering over the BBC/Sky Deal

  1. James says:

    Very well thought out and logical report.

  2. Pete A says:

    Another thing worth pointing out is the increased coverage on Sky Sports News, which will promote F1 alongside football and cricket to its existing customers and get them interested. For that reason the move to Sky will continue to see new people watch the sport.

    • I agree with that. I definitely feel the quality of exposure and coverage will actually improve. My only concern will be whether people will fork out for the subscription or not.

  3. Jason Lewis says:

    As thorough as ever Mr. Marshall. I have access to Sky TV through some clever Internet magic so it won’t affect me unless Sky decide not to allow streaming online of F1 but that said; I have never much liked coverage of sports on Sky, I always preferred the BBC coverage of sport. Unfortunately I can’t stop the relentless march of progress but being British (exiled in America), I can complain!

  4. Spadowski says:

    The big issue IMO is how important F1 is in the history of sports in England. From a cultural standpoint I firmly think it SHOULD be free to air. All of it. (I’m a Brit, but have lived in Canada for 15 years where I pay $70+ a month to get F1 in HD)

    You can’t compare to the premier league, as there is the exact same sport still available free.

    F1 is it’s own entity. Many people are fans are JUST F1. I don’t know a single person who is JUST a fan of the premier league, so you can’t make that comparison IMO.

    Bernie should have thought of the country that largely is the hub of F1. Most teams are based there and done the decent thing. England is probably the most important country in the world to F1, and Bernie just gave a huge middle finger to pretty much every fan I know who can’t afford Sky Sports, and even if they could can’t justify paying the $600 it costs to set it up for next year just for 8 hours 20 weekends a year.