Liberty Media buy F1
- Thread starter Bill Boddy
- Start date
TR
Points Scorer
To play devil's advocate: By owning shares, teams would have a vested interest in the overall (commericial) success of the sport (beyond just the success of their own team). In theory, this should make it easier for the teams, FIA and FOM to come on one line when decisions are made. Note that owning minority stakes in F1 probably would not increase the actual influence the teams have on the sport. (The governance structures would be unaffected, by this particular change)
It would make it harder for teams to join the sport and is only a step away from franchising F1.
The tail wags the dog far too much in F1 as it is.
There is also the issue of what happens to a teams share holding if they pull out. Take Renault as a classic example. They have been in and out more times than you could shake a stick at. What would happen to their shares if/when they revert to being an engine supplier?
The tail wags the dog far too much in F1 as it is.
There is also the issue of what happens to a teams share holding if they pull out. Take Renault as a classic example. They have been in and out more times than you could shake a stick at. What would happen to their shares if/when they revert to being an engine supplier?
The governance structure is the bit that's broken. The commercial rights holder should have no input into the rules of the sport and neither should the teams. If they break the bond between the governing body and the commercial element of the sport the teams can have as many shares as they like. All the time FOM calls the shots on anything to do with the rules the teams should not be allowed to have a single share in the company.
TR
Points Scorer
I do not think they are suggesting that own shares would be mandatory to run in formula 1. They are simply suggesting giving the teams the option to buy into the shares. (Note that they have been given this opportunity before and most teams passed on the occassion because they didn't think they were getting value for money.
In short: nothing. Renault will still own the shares which they can then try to sell. or not. I think the main thing liberty media would hope to accomplish is the bind the "legacy" teams more strongly to F1. If they own shares, threatening the nuclear option of leaving for teams like Ferrari and McLaren would mean they would take a significant loss on the devaluation of their shares. In principle that could improve the decision making process.
I don't think its as straight forward as that. The whole reason people own shares is to make money and have a controlling influence on the way things are run.
As FB points out, while the teams are able to influence rule changes the addition of shares would see them wish to exert further influence on all areas. They will want an increased return on all that investment.
New teams will have to buy shares or miss out on potential revenue. Teams who leave the sport should be made to sell their shares otherwise they could exert undue influence.
Premiership Rugby operates a team shareholder model and for a few years there was the ridiculous situation of Bristol Rugby club holding shares in premier rugby, reaping the rewards and voting on premiership issues and yet not being in the league. Clubs like Leeds on the other hand were unable to buy shares and had no influence on the Premier Rugby board even though for a while, they were in the league.
As FB points out, while the teams are able to influence rule changes the addition of shares would see them wish to exert further influence on all areas. They will want an increased return on all that investment.
New teams will have to buy shares or miss out on potential revenue. Teams who leave the sport should be made to sell their shares otherwise they could exert undue influence.
Premiership Rugby operates a team shareholder model and for a few years there was the ridiculous situation of Bristol Rugby club holding shares in premier rugby, reaping the rewards and voting on premiership issues and yet not being in the league. Clubs like Leeds on the other hand were unable to buy shares and had no influence on the Premier Rugby board even though for a while, they were in the league.
F1Brits_90
World Champion
i like the franchise system because it hope should mean equality on entrance money + prize money ie NFL & should stop the emptying grids or the new team struggles where manors taken 6yrs to be competitive
thinking earlier, if chase carey wants to take f1 to next level, what is 1 thing would i do & i think we need to change this pay tv model to try an comprise. as i would let pay tv have every practice & qualification exclusively live, even let them have more race build up, but make sure every GP is free to air so we can inspire the next generation, as we dont want to have same regrets as ECB did during ashes last year
thinking earlier, if chase carey wants to take f1 to next level, what is 1 thing would i do & i think we need to change this pay tv model to try an comprise. as i would let pay tv have every practice & qualification exclusively live, even let them have more race build up, but make sure every GP is free to air so we can inspire the next generation, as we dont want to have same regrets as ECB did during ashes last year
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The big problem with the franchise model is that it may benefit those in the club but to get in becomes next to impossible for most.
You could for example, end up with a situation where the franchise holders veto a new applicant. Mercedes biggest domestic rival is the VW group. Imagine if they finally make the leap and put an entry together. How much easier under a franchise system would it be to block.
I have and will always believe that F1 should be completely open in so much that the only constraints on entering are the technical regulations. Anybody who can build a car that meets all of the technical and safety regulations, should be able to compete.
You only have to look at the number of teams on the lower rungs of the single seat ladder who, in the last 20 years or so, have openly spurned the opportunity to step up to F1 because they would be unable to compete. For some of the extremely professional outfits at those levels to say that, you know the system is wrong.
One of the joys of Football is any team has a chance of making it to the top. Wimbledon, Leicester, Bournemouth and Wigan all being good examples. There is no pathway like that anymore in F1 and going down a franchise route would make that even harder.
You could for example, end up with a situation where the franchise holders veto a new applicant. Mercedes biggest domestic rival is the VW group. Imagine if they finally make the leap and put an entry together. How much easier under a franchise system would it be to block.
I have and will always believe that F1 should be completely open in so much that the only constraints on entering are the technical regulations. Anybody who can build a car that meets all of the technical and safety regulations, should be able to compete.
You only have to look at the number of teams on the lower rungs of the single seat ladder who, in the last 20 years or so, have openly spurned the opportunity to step up to F1 because they would be unable to compete. For some of the extremely professional outfits at those levels to say that, you know the system is wrong.
One of the joys of Football is any team has a chance of making it to the top. Wimbledon, Leicester, Bournemouth and Wigan all being good examples. There is no pathway like that anymore in F1 and going down a franchise route would make that even harder.
TR
Points Scorer
As I understand it, Liberty Media (like CVC before them) own a preferential controlling share in the FOG. This means that their vote always outways those of the other shareholders. Consequently, owning shares for the other shareholders (including potentially some of the teams in the future) is a solely financial deal. Worries of increased influence of the teams on the ongoings of F1 if they become shareholders is unwarranted.
As for new teams having to buy into shares or miss out on revenue: They would not be missing out on any revenue that they are not currently missing out on. FOG operational profit is split in two. One half goes to the F1 prize pool (i.e. the teams), the other half goes to the shareholders. This means that if the teams become shareholders a larger pecentage of FOG operating profit goes to the teams. Teams not owning share miss out on this extra piece of the pie, but still get their regular share of the prizepool.
Further if I were Liberty media, I would try to get rid of this "historical payment" bussiness by offering the legacy teams a discount on shares.
As for new teams having to buy into shares or miss out on revenue: They would not be missing out on any revenue that they are not currently missing out on. FOG operational profit is split in two. One half goes to the F1 prize pool (i.e. the teams), the other half goes to the shareholders. This means that if the teams become shareholders a larger pecentage of FOG operating profit goes to the teams. Teams not owning share miss out on this extra piece of the pie, but still get their regular share of the prizepool.
Further if I were Liberty media, I would try to get rid of this "historical payment" bussiness by offering the legacy teams a discount on shares.
Certainly agree with getting rid of the ridiculous legacy / historical payments.
The Liberty Media sale could be blocked by the EU.
EU Must Investigate Formula 1's Competition Rules
EU Must Investigate Formula 1's Competition Rules
F1 should add second USA race by 2019, says Brown
If it comes about, I would hope the venue would be either its historical home at Watkins Glen or, even better, at Laguna Seca, although I have my doubts F1 cars would be compatible with the latter.
I would also LOVE to see F1 return to St Jovite in Canada, perhaps the most beautiful F1 circuit we have ever been to.
If it comes about, I would hope the venue would be either its historical home at Watkins Glen or, even better, at Laguna Seca, although I have my doubts F1 cars would be compatible with the latter.
I would also LOVE to see F1 return to St Jovite in Canada, perhaps the most beautiful F1 circuit we have ever been to.
I have to agree with that, as I am sure the circuits WOULD be butchered, which would be totally unacceptable.
Maybe formula E would be willing to race on them as they are.
Maybe formula E would be willing to race on them as they are.
There was a link on the BBC in F1 Gossip a few days ago that I was going to link to on here but I delayed and it was gone. So here it is, the future of F1 which sounds pretty crap to me, but then I'm not in the game of maximising money for the owners.
Liberty eyeing gambling as future growth area for F1 - Pitpass.com
Liberty eyeing gambling as future growth area for F1 - Pitpass.com
Heh that article is so squarely focussed on making money that it completely ignores the sport itself. It's a shame it didn't even hint or nod towards the fact that to get more sponsors and more revenue, you need more fans, and to get more fans you need to hold their interest. That's the bit we want to hear about.
TR
Points Scorer
Liberty planning F1 budget cap
How long till Ferrari and other big spenders threaten to break off in their own racing series?
How long till Ferrari and other big spenders threaten to break off in their own racing series?
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