Here?s how Formula 1 will change, now that Bernie Ecclestone is out the door
http://arstechnica.com/cars/2017/01/...ing-formula-1/
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In September 2016, news emerged that Formula 1 was changing hands, with a proposed sale from CVC Capital Partners to Liberty Media. Despite a couple of hurdles?including the sport's regulator standing to make a hefty profit from the sale?everything looks to have sailed through without a hitch. On Monday we learned that the sale was final and that the new owners have made an immediate change, for Bernie Ecclestone will no longer run the show.
We've known since last year that Chase Carey would be Chairman, with Ecclestone staying on as CEO for the near term. Evidently near-term meant four months, because as of Monday, Carey is the CEO. Ecclestone has been made Chairman Emeritus, and according to a press statement will "be available as a source of advice for the board of F1."
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That advice comes from decades of experience, because Ecclestone is the man behind F1's commercial success. He consolidated the broadcast rights from individual races, negotiating on behalf of the other teams. Bit by bit, he took charge of everything, turning the F1 Grand Prix into the well-oiled machine it is today. The FIA was still the sport's organizing body and would still set the rules, but it gave Ecclestone the commercial rights. Tracks would pay to host a race and could keep any profits from ticket sales. But the rest?all that trackside advertising included?would go through his companies.
Local broadcasters, which it must be said were not all equally good, were gradually replaced with a traveling TV production facility. Luxurious VIP facilities rode in on the same 747 cargo planes, coupled with layers of security that kept the average fan well away from the cars and drivers, giving the sport an air of exclusivity. By 2005 the show was owned by a private equity group called CVC Capital Partners. Intricate?some might say murky?finances prevented CVC from its intended plan of floating F1 on a stock exchange, so instead it just sat there, reaping immense profits while doing little to invest in the business.
That period of chronic underinvestment is why so many have cheered the sale to Liberty. The sport might be in rude financial health, but many of the tracks and some of the teams are far from it. Huge sanctioning fees mean it's impossible to host an F1 race without state support (Monaco being the exception). Petrostates like Azerbaijan and Russia will pay $50 million a year to bring the circus to town. Meanwhile it falters in its traditional heartland of western Europe where the British Grand Prix loses money paying less than half that amount. There is no German race on the calendar for 2017, ludicrous considering the success of Mercedes and the concentration of German drivers in the sport. Are these events to go the way of the French Grand Prix?
