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Chase Carey responds to Bernie Ecclestone jibe about “overcharging” F1 promoters
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Chase Carey
Posted By: James Allen  |  17 Apr 2017   |  8:21 pm GMT  |  140 comments

F1’s new CEO Chase Carey has responded to comments by his predecessor Bernie Ecclestone at the weekend in Bahrain that F1 race promoters had been overcharged and will now want a discount or to withdraw from their contracts, as well as his assertion that Liberty is not focussed on profits, where he had to be to satisfy his shareholders, CVC Capital Partners.

The American told the Financial Times on Monday that Ecclestone “managed for short-term profits, we are managing for long term value”, while he said that race promoters “were not tricked” on price, but the problem was “has F1 invested in the right way to support the events?”

Ecclestone was deposed by Liberty Media once they completed the takeover of the sport in January. He was made chairman emeritus. They installed Carey and his management team and they have since renewed circuit deals with Russia and Canada, while the Singapore promoters were in Melbourne to discuss a contract extension. However Malaysia has announced that this year’s race will be the last.

Bernie Ecclestone

What Ecclestone said

Ecclestone was in Bahrain as a guest of the Bahraini Crown Prince and went on the grid on Sunday. On Friday he met with reporters at the track and said,

“The only thing that would be good for everyone would be if we could charge the promoters a lot less money. I charged them too much for what we provide.

“I did some good deals commercially. They are paying a lot of money, and most of them, if not all of them, are not making any money. Quite the opposite.

“Sooner or later I’m frightened that the governments behind them will say enough is enough, and bye-bye.

“If we could reduce the fee they pay they could then charge less for tickets and sell more tickets.

Bernie Ecclestone

He also suggested that Liberty Media and the new management were not worried about managing the F1 business for profit, as they are spending money he did not on new areas like commercial research, marketing and digital media.

“I was running the company to try and make money for the shareholders. It doesn’t seem that’s the thing that’s driving them. He (Carey) wants to get more happy spectators I think,” said Ecclestone.

“It’s not for a few years when people start thinking you haven’t done what you thought you would have. I wouldn’t want to be having to deliver to a public company today. I feel sorry for Chase having to do that.”


What Carey said

Carey was reluctant to get into a tit-for-tat with Ecclestone, however on these points he responded to the Financial Times on Monday,

“These were agreements negotiated between two capable parties and if there is a definition of fair value it’s a deal that two capable parties agree on,” he said “These were agreements between two parties that valued the franchise how it was valued. Nobody was tricked.

“If there is a point to it; has F1 invested in the right way to support the events? It’s not that the deal is overpriced, it’s more did we deliver where we should deliver?

Lewis Hamilton

“So when Bernie says we are not managing for profits, what he is meaning is: we are investing in marketing, investing in digital.

“He managed for short-term profits, we are managing for long term value.

“Many times to build value you will invest money at an early stage to increase value at a later stage.

“If you look at sports that have had incredible growth, like the English Premier League or the NFL, they have made investments to grow their franchise. We are committed to growing value, but we do believe it’s important to invest in the sport. We do care about the profits, but realistically the long-term value is what it’s all about,

“Therefore some of the things that should have been done to support the events; marketing the sport better, creating access to digital platforms to bring in new fans, to provide research to understand how do you make it better, those sorts of tools didn’t exist.

“The (Ecclestone) comment on profits is very telling; is it about short term profits? No. We’ve been very clear; we think it’s about building long term value.

“Investing money does not mean we don’t care about profits”

What do you think of this development? Leave your comment in the section below

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140 comments

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1

Mr E's Obama esque "pivot to Asia" was a disaster, hopefully Ross the Boss and Co will steer the circus back to the likes of Imola, Estoril, Nuburgring and even Brands Hatch in the not too distant future. Who knows, maybe even Kyalami, Buenos Aires and Long Beach may return Lazarus style within half a decade, and nobody would complain if they did!

2

The fun today in F1 comes from the the Asian and other global circuits. Many of the European circuits (with possible exceptions of Monte Carlo, Spa and Monza) are just cathedrals, including pipe organs and all. Great if you love that sort of traditional stuff, but hardly exciting.

3

Europe is simply too poor to host F1.

4

Gaz boy are you living in 20th century? Wake up man, its the 21st century that the real cash stay in Asian, not the US or europe or anywhere else. F1 hasnt done enough in east asian yet. There should be a minimum of 3 chinese GPs (shanghai, beijing/guangzhou and Macau) with additional GPs in mid east.

5
Ricciardo Aficionado

How was putting the sport in front of new markets a disaster?
What, if anything has been disastrous for F1?
Declining TV audiences is about the nearest thing to disaster that F1 has experienced. And that can be put down to various periods of domination and the associated poor racing rather than moving races into Asia.
But even so it didn't prevent Bernie selling the sport for multiple billions of dollars.
I think you have a strange notion of disaster...

6

Define disaster! It certainly was not a disaster for Bernie or his shareholders, far from it. But it was a disaster for TV audiences as you have mentioned, it was a disaster for many circuits as they had to pay too much for the package that they go (virtually an empty bag), and it was a disaster for the general public who can no longer afford to go to a F1 race as a family (most circuit grandstands are almost empty for the race weekend). Long term value against short term profits every time.

7

A disaster for whom? Certainly not the shareholders - it brought an awful lot of money into F1.

8

There's a case in point here. For many Asian fans (like me) the initial allure of F1 was how it used places and settings that were "exotic" to us like... well... Imola, Estoril, and the Nurburgring. It kinda felt more "localized" once the races came to Malaysia et al.

9

Valencia would be nice, too.

10

Valencia? seriously.

11

One can only hope that F1 never ever returns to valencia!!!! What i first thought was that it would be really great! It wasn't.

12

Please no. That, along with Korea, India, and Russia have to be some of the most mind numbingly dull circuits on the calendar in years gone by.

13

Valencia would be nice if there was an actual track, there will never be another race through the container port again.

14

@Gaz Boy - I agree.

Bernies view was to gain the largest income from the bidders and obviously there were some countries that had unlimited funds and personal interests in securing an event like this.

This was always going to 'kill off' the old circuits that apart from spending money to improve the circuit to todays safety requirements, then had to add onto that cost the 'Bernoe fee'.
Imagine what any circuit could do with the $50mil (reported however happy to be corrected) to improve their track to FIA standard or pay for the later environmental standards?

Maybe we wouldn't have lost the old Hockenheimring if an offset for the 'tree loss' could have been produced..Just saying

15

How was it a disaster...will you not have a race in China Singapore, Middle East or even Malaysia.
They have all been successful events. He did the right thing in moving with the times. You can't just bask in the old and say that way was better just because you have some elitist idea of f1 only being run in Europe.
Do you think the new owners will close shop and move back all races to the old circuits. I think you're deluded then. F1 created new fans in Asia. The big brands such as Mercedes et al got more value for their participation. No one would venture back to 12-15 race a season in europe. It's a world championship for a reason.
Do you think if these old circuits can afford to manage races nowadays. I don't see anything wrong with opening in new markets. It was a forward thinking move and has helped the sport grow.

16

Turkey? Korea? India? What happened to them?

Notice I wrote about Kyalami, BA and LA (Long Beach) coming back, because in South Africa and the New World there is a heritage and appreciation of motor sport that runs deep - something that the "Pivot to Asia" failed to address.

17

A lack of understanding of business brought you to such conclusion, at a point interlagos and Silversyone were struggling to pay the fees to host the race!

18

No ways Gaz, South Africa has serios poblems paying for other stuff and maintaining our elected government officials. the SA govmnt. doesn't need an annual invoice of R350m going out to FOM when we don't even have a driver or motosport association in there...

19

Exactly right, and lets face facts, the Singapore GP is a processional event at best, dressed up with bright lights - hardly a race at all. Then the middle East (Asia is east right?) where there are two events with almost no national or regional interest. Two events who pay massive fees, which replaced other well attended races who could not pay crazy rates...

20

Could this simply be a way by FOM of generating easy headlines.....maybe.

Could it be Bernie crudely attempting to lower the rate before bidding on the Brazilian track.....maybe.

Or could it be the last time we ever see Mr E at a race again.......it's hard to say either way but do we really need to read about the new and old owner (or their representatives) squabbling at such a great new interesting time in F1 history.......no.

21

Same thought here - Bernie is just starting negotiations for his circuits by talking down the current fees.
Which circuits does he have a financial interest in? Brazil, Nurnbergring? any others?

22

@ Axel....I have always thought that this business model is all wrong. The fact is that FOM didn't do hardly any promotion. Combined with the massive fees charged to the track owners meant that ticket prices became ridiculously expensive. In the real world FOM should've been paying the circuit owners to use their venues. Then FOM should've cut a deal with the circuit owners for a ticketing revenue split and shared marketing costs. TV revenues could be a direct income stream to FOM as well. Then we would see a more equitable split and better attendances with a positive cash flow.

23

He's expected in Sochi, Monaco, Singapore, Mexico, Brazil

So no...

24

James, I wonder if you could give us an idea of the mood in the paddock when Bernie is around? Are people pleased to see him, or is it a bit awkward?

25

But of both depending who it is!

26

I should be shocked that Bernie is throwing bombs now, but it's entirely in his character, isn't it? It's admirable of Liberty to take a high road in responding, but the changes in the fan experience and the drivers' and teams' ability to interact speak for themselves.

27

Bernie might be suffering from RDS - Relevance Deprivation Syndrome. He's gone from rooster to feather duster and that's gotta hurt.

28

"I was running the company to try and make money for the shareholders. "

Yes. We know.

29

He also forgot to add, "I was happy to destroy the sport for profit in the process, particularly over the past 10 years."

30

LOL Yes, as a fan we all knew that very well

Bernie - "once a car salesman, always a car salesman"

31

"once a car salesman, always a car salesman"

No truer statement...

32

Everything Bernie says has hidden meaning and is said for effect. He's really talking to the shareholders and telling them what a wonderful job he did for the past lot and what a poor job the new management is doing for the new lot. In effect he is saying "Get rid of me would you, well watch it all fall apart. It's your loss Liberty Media, up yours".

33

roborbob thats funny,,, The next concorde negotiations should be interesting, who here thinks Ferrari will lose their showing up money, any equitable ditribution of funds agreed by the top 3 will be more like a concession of 5% and no more. Like Mr E said, it's impossible to get this lot to see beyond their personal good.

34

@pepe - Well, the next Concorde agreement will show what Chase, Ross etc are made of. Money just has to be more equitably distributed. Ok perhaps there should be some advantage for being part of F1 for a long period (particularly Ferrari being the longest serving of all) I wouldn't begrudge them that, but it can't be the ludicrous percentage the top few teams (again, particularly the red lot) get now. Actually I trust that Ross understands this and he will ensure the "Bernie Bonus's" are a thing of the past.

35

James,

I would just like to say I love having you back here doing all the writing yourself. It's probably too much work for you and you will probably soon have some help, but I enjoy reading YOU. I can tell which article is written by you without reading the authors name. I'm sure I'm not the only one.

36

100% agree, the sole reason I come to this site. James' style, depth and insight makes his articles far beyond mere reporting.

37

100% agree.

38

I think Bernie should keep his head down and put his retirement into practice; it's hot talk to say promoters were charged too much after he's been nailing them down for years... I think most fans are pleased Liberty are getting in and have real intent to improve the sport and fan experience. Maybe BE did need to make a gross profit but he chose CVC so its pretty cheap to turn up now and ytalk like this.
Bye Bernie, hello Brave New World...

39

So true. Beanie has no class. You made your money. Leave gracefully. Find a new hobby, but don't throw new management under the bus just because you wanted to run F1 even from your grave if you could.

40

any "improvements" will show their effects in the next 5 years or longer. It takes a long time to build something from nothing and a very short time to destroy it.

Oh and by the way its the same old world .... still.

41

And another thing, I see the other Former manager in F1 is sitting with him in his buggy. Good riddance to both of you might be a suitable reposte to any of this pairs utterances. They deserve each other.

42

Bernie has to get used to the new landscape. His comments say more about him than F1. He did build an incredible sport with great vision and drive, but the wheels have been falling off the way he worked for a long time now. It would have been better for F1/fans if he hadn't sold out to CVC and if he'd listened to the many voices in F1 calling for marketing, investment, fairer pricing and value.
Thanks Bernie you were great, enjoy the new journey and shut up.

43

What? Bernie did excellent to commercialise F1 for TV, but everything else has been Scrudge McDuck gone wild...

44

Bravo, Chase Carey. Take the long view; so refreshing to hear.

45

Not sure if Bernie will be around to see the new management's success. Great to see finally someone gives a damn about the fans. If the show is good, money will come, fans will be happy to pay.

46

Bernie throwing the cat (the lynx maybe?) amongst the pigeons! He's doing this to remove bargaining chips from Liberty's side of the table when it comes to the race promoters. What a wily codger! If Liberty (and Chase) wants this to be their show, they better find a more effective way to remove him from the table, or he's going to continue to dance around the circus and drop "pipe bombs" while saying, "Glad I don't have to take care of this business now!"

47
Clarks4WheelDrift

Ecclestone and CVC greed combined with the lack of racing for victories was killing F1 for future generations.

Most casual fans I know of have gone, those that enjoyed watching the championship before it went behind a paywall and before the Mercedes PU waltzed to so many poles and wins, predictable before the cars rolled out of the trucks.

Very very few kids of friends are even interested in F1 at an age that I and previous generations were into it. My son usually exits after lap 2 in the past three years and I show him the action, usually involving Alonso or Verstappen or Sainz or Dan Ric or Seb on the radio in the post race Paul Di Resta sky pad highlights.

The F1 app is a prime example of the greed, take away the freely available info from the live timing F1 site that fans could use to monitor gaps and pre/post pit lap time races between drivers, then make it poorer and put it behind a paywall. Chase is right to research and invest in digital platforms for F1.

It's good CVC are gone, it would be good if F1 could manage its way out from behind the paywalls as well to bring back the audience.

I bet the difference in UK viewing figures for say Canada 2011 to Canada 2016 are massive.

Ecclestone milking F1 in recent years is like Kodak's long term view when Digital Cameras came along.

48

Good post, Clarky. As a student of business, there can be some equity in a brand when marketing a product as exclusive, which I feel that F1 has done for many years: Paddock Club; restricted use of images; the reduced value in the free F1 App and website; reduced ability for promoters to attract their own sponsors for trackside signage (while courting high-end specialist brands such as Rolex and UBS). Even effectively using the sport as a siphon for CVCs various business interests.

Problem is, this only works when the product is in demand (i.e. everyone wants a Ferrari, but only a few of us can afford it).

Thing is, how do they re-dress this balance? How do they retain the revenue stream from the people willing to pay, and the people that aren't?

I was looking at some images from 1995 over the weekend, and the sponsors involved then were much more prominent brands than those that are in play now. This was at a time when there was a zenith in global viewing figures and there was likely to be more tangible reward for being part of the show. It was a game of high-speed billboards being beemed to millions of eyeballs around the world - and I would wager that the racing may not have been as exciting as we currently romanticise about. The season was shorter, but we were left wanting more.

Chase needs to be sure not to get in too many arguments with Ecclestone, who is now essentially F1's ex-wife. Any criticism Bernie levels on the current F1 predicament is an indictment of how he ran the show, as Liberty in essence has been in charge for 5min.

Me? I'd just like to be able to watch the [self-mod] show that I have for the last 20 years without having to give a pound of flesh to do so.

Even if it was a basic lights-to-flag world feed coverage with no extras, as opposed to the current 24-hour-delayed, 1-hour-with-25min-of-ads that is limply offered to the FTA viewing public in Australia at the present moment.

49

Actually CVC are not gone. They are key shareholders in Liberty to the tune of about $1.35 Billion. When Liberty "bought" F1 holdings it paid very little in cash.

To that end, CVC has made upwards of 350% return on its investment (thank you Mr. Ecclestone , indeed ) and if you think spending a few million developing a better app is going to make our kids watch F1, your truly mistaken.

They could have done it. Just like the FIA could have done it. In fact its the FIA that we have to pose the question why our kids are not into F1 as much as we were...... not some dude named Chase who knows little if nothing about racing.

50

Oh why oh why does the media give BE the oxygen of publicity he craves....let him shout in the wilderness......

51

Bernie needs to keep his trap shut and disappear with dignity from anything to do with F1. He is clearly still smarting from his removal, and wants to cause trouble to punish Liberty for their decision to carry on without him. The problem with Bernie's "I was only following orders" spiel when it comes to over charging promoters under the CVC regime, is he did exactly the same thing when he was doing it for himself!

52

So, at last Bernie is free to tell the world how he screwed all those Far East governments and oil tycoons out of their money and does so with no disguising of the fact. And then he goes further and tries to put the blame on Chase and co. The guy is a total eejit.

53

But he's a very wealthy 'eejit'. The fact is that, as another poster has said, Liberty have only been around for 5 mins. and we really don't know what they have in mind. Given the sheer size of the acquisition they aren't about to become 'philanthropic' overnight so until we see the proposals we can only hope that the access is improved and at a more reasonable cost, but i won't be holding my breath until that happens.

54

The old man cant leave it, can he? Any sport which wants to stick around, needs to expand its reach to younger and a lot more audiences. Some times its that simple. "making money for shareholders" instead of "selling more tickets", what an irrelevant thought of doing business in 21st century.

55

Well Bernie has said it himself - he (and CVC) was all about "short term profits". #GoodRiddance

56

“I did some good deals commercially. They are paying a lot of money, and most of them, if not all of them, are not making any money. Quite the opposite.

Says it all about Berne.
But I'm confused, is ne now criticising the deals that he put in place?

57

Yes, he is. Trying to shift the blame onto Liberty, so that the circuits will ask for better deals on pricing, thereby hurting Liberty.

58

When I hear Bernie accusing others of charging promoters too much I feel physically sick.

59

He's not

He's saying he charged too much!

60

You mean he has grown a conscience after he is no longer in charge?

61

"I charged them too much" is the quote of the season so far.

62

Does this have anything to do with Bernie's reported bids for interlagos, or was it just a strategic shot.

63

He said he was not buying Interlagos

64

I was literally shaking my head in disbelief as I read this article.

You know him better than any of us James, so maybe you can tell us what it is that he actually hopes to gain from this.

Is he trying to stay relevant to F1? Is he even trying to get his old job back?

Or (as some have suggested) is he simply playing a card before negotiating terms for the Interlagos circuit?

I'd really genuinely like to know, because as far as I can tell all he's achieved with this is to make Carey sound like an absolute champion while making himself sound like the world's biggest hypocrite.

65

After reading both biographies on Bernie (I'm No Angel by Tom Bower and Bernie by Susan Watkins) I found a new appreciation and/or perspective for the man.
He's definitely not the devil that people like to portrait him.
It always felt that not even Bernie knew why was he doing what he was doing. It couldn't be just for the money, as anyone that read the books know that if there's someone that never knew how to enjoy the money he had, was him (you can not say the same about Slavica or their children). It always came across (well at least to me) that what he really enjoyed the most was the power/leverage he had over others, and always looking for the better "deal", even if just to say "He thought he was screwing me over, but I got the better deal out of it".
He also comes across as a very lonely person even though he spent the last 60 y surrounded by so many important people. I think Bernie is lost now. And I feel for him. He used to walk around the paddock and everyone wanted a piece of the prize, and now he probably feels "emasculated". He doesn't matter anymore. To someone that has always mattered, this is as close to dying as you get. I have mixed feelings about Bernie, as nothing is black and white, and just different shades of grey. I just wanted to say all of us have the same evil and the same good Bernie has, maybe we haven't been tested in the same that he has.

66

Well said Fredy.

67

He likes being at the centre of things and can't really deal with the idea of not being.

If you look at the F1 landscape, he has little leverage now with the big teams, run by OEM megastars like Zetche (Merc), Marchionne (Ferrari), Ghosn (Renault) etc, although he does have great leverage with Red Bull's boss.

But F1 doesn't work without circuits - and the Liberty business model requires a very high ongoing yield from them - so as we've observed several times in the last year, his main leverage is with the promoters and that's where he's focussing his energies.

68

Then james all i can say is, that they were fools to do so. In reality they should've simply said no. Sooner or later his bluff would've been called and he'd of had to negotiate.The circuit owners had the levers but did n't

69

Cheers James 🙂

As I pretty much said before, although he did a lot for the sport he really needs to accept the fact that he's out and move on.

70

But he isn't going to refund them.
If I were a promoter, and Bernie showed up, I would kick him out faster than a Honda F1 PU can fail :p

71

Now that Bernie is reportedly trying to own the rights to the Interlagos circuit, he doesn't want to be on the receiving end of his own extortion. Truly poacher turned gamekeeper.

72

CVC business model is to buy a business, extract as much money as possible during a short to medium term (even incurring in debts to pay dividends) and then reselling as expensively as possible. So Ecclestone is saying that he was working for CVC, not for Formula 1.

I do not see any controversy here. It is more like Ecclestone is explaining why he did not develop the business: because it was not the interest of the shareholders. Of course, all of us that come here are more interested in the sport developing further than on the financial sheets but at the end of the day, CVC were CVCing, and Liberty Capital seems to be interested in making yet more money over the long term, therefore they are willing to invest in the business to make a bigger deal in the future.

Two

73

There's only one bernie Ecclestone; the man who after being deposed readily admits his deals were far from sustainable for the sport.

And we are going to sit here and accept it?

Ok.

74

Surely there must be many naive people who seem to think that Liberty will be the saviour and that there will be better presentations for less! I would think that costs are the biggest challenge for both the promoters, the teams and the consumers/followers and fans. Liberty hav a massive investment and they need to justify a high level of ROI. Don't expect to see any return to a lower economic participation than what we've been forced to accept in the past.

75

He's saying he made profits for the shareholders and that Liberty will have a harder time because they don't have him on board. There is nothing wrong with making profits for the shareholders. Its the way the game is played.

Chase knows that enterprise Value = Market Capitalization + Total Debt - Cash. Well perhaps he does not so Bernie just made it clear.

76

So he finally admits to what everyone on this site has been saying for years. I wonder when he came to realise that?
He built the sandcastle, then kicked it over adis now using the Nuremberg defence: "I was just following orders"

77

Is Bernie missing the limelight, or is he just trying to airbrush some of his past decisions in an attempt to leave a more positive legacy. Maybe he is just perturbed that the general consensus is, all be it early days. That the new guys seem to be more popular with the fans and at the outset, having a much better grasp of whats needed to take the business and sport forward than he. His baby. How that must sting. Once talked up as irreplaceable, he's been replaced. And i for one like it. You've had your time Bernie, made your money. Now please just go.

78

Bernie also said that the new owners might sell the business very soon.
...
I guess since Bernie wants to be the GP Brazil promoter, maybe hs strategy is making a GP promoters alliance to takeover F1 again.
So compaining about the promoters fee is a way to benefit himself and his new alliance - by lowering it.

79

Why would Carey talk about investing to build long term value if Liberty intended to sell soon?

80

Well, this is clearly a strategic move by BE, for whatever reason. He is trying to devalue Liberty's stake & negotiating position with circuit owners.

On the face of it, Liberty may be in a tad bit of trouble. Expanding F1's global reach while having pressures to lower fees it's extremely difficult.

Carey has to talk long term. No investor in their right mind would talk otherwise. If the intend to sell soon or later, long term strategic growth is always going to be at the core of any sales proposal.

82

Never thrust, I repeat, NEVER thrust anything the Daily Mail reports. Garbage mascarated as news.

83

Bernie is showing his true colours and is clearly trying to damage the sport that he did so much to develop. It was always quite clear that Bernie was driven by money and its fair to say that he did very well out of motorsport. If he thinks that the deals he did were not 'value for money' (for promoters) then maybe he might think about refunding them from his own pocket.

Bernie is yesterday's man and he should withdraw gracefully, leaving Liberty to get on with managing the sport in the manner they see fit.

84

If anything, Liberty just came along and used a public offering to overpay for something of value, created in part by the business savvy of Bernie Ecclestone.

I suppose Liberty's idea of marketing is to bring in a few celebrities to attract "fans" ?
The bottom line is profit and they know it. The rest of it is all fluff in the wind.

Get the best drivers in the world into this sport and let it happen. We need more MAX.

85

From what we have seen so far it's a bit more sophisticated than that!!

86

I think this social media myth will burst like a bubble soon.

No one is paying for SM content its free so how they are going to generate more income from it yet to be seen. Other than people who own the platforms were the adverts will be placed!

87

you just identified the red herring in all of this.

James has a point, its much more sophisticated if you want it to be, in fact it should be to those with intellect. I just fear its really not.

88

Just when I was enjoying E-free F1...

89

Well I'm sure the race promoters are thrilled to hear that they've been robbed the past few years! Lol!

Only Bernie!

I'm sure part of his comments are driven by the fact that F1 is doing better than ever in such a short time without him.

Whatever undertones his comments have the reality is without power he just seems like a bitter old man.

90

They will be happy indeed because he has just strengthened their negotiation position with Liberty

91

For the best part of 50 years, Bernie has been at the centre of F1 and his whole life involved him in controlling the sport. Very little happened without his say so. He had his hands on the purse strings and decided who received what. In his own words, he was the dictator of F1. Power was everything to Bernie.

Every last bit of that power went out of the window a few short weeks ago. He doesn't know what LM are planning, he doesn't have a say in what they're planning, because they probably won't tell him. He was booted out without warning. They've moved the FOM offices out of his home. The long term colleagues at FOM have also gone. The poor man is lost, nobody really cares what he says or thinks. Bernie must be climbing the walls in fustration.

Sad innit!!

92

This is a very interesting article James and thanks again for you bringing it to us.

At the end of the day Bernie charged a fee and the promotors (rightly or wrongly) accepted that. The cost of this was obviously passed onto to someone (the customers). He was consumed by profits for the shareholders and adding value to the company.

It is refreshing to hear Bernie say that 'they charged too much' however that is now far to late and no consolation for the paying customers in the past.

It is also no good for the circuits that 'went to the wall' over the reportedly $50mil??? fee (was it that amount or similar - only the contract people know this???).

But moving forward, if Liberty reduce the promotors fees for the GP, will that flow onto the paying public? I can't see a reduction in entrance fees however we may see that in other connections via internet or relaxation in the 'exclusiveness' of F1...But at the end of the day we will probably pay the same for the yearly experience. As Chase outlines (same with Bernie) will may get more for our money...we can only hope.

nowadays you get nothing for free - but we can hope

93

Liberty will not reduce the fees. As Carey says here, they plan to make the ticket far better value for money by improving what's on offer around the racing, and making the promoters more sustainable by bringing bigger audiences. The model is there in other sports, especially NFL, which they know very well.

They seem to have a plan, but so does BE and that is to try to agitate the promoters. It's fascinating to watch

94

I am just curious James. If Bernie were to start a new series and could persuade Ferrari Mercedes & Redbull to join him with the lure of a loyalty bonus once the concorde agreement expires. It it necessary to get the sanction of the FIA. If I am not mistaken he owns the right to GP1 and could rival F1 with his new series

95

'Adding Value' might work in the USA but I am not convinced it will be as viable a strategy in countries where consumers are more cynical eg around Europe. If the promoters ever do put their heads together Liberty could be in a difficult situation and that is what I think Bernie is playing for. In the 1970s Peter Grant and Jimmy Page (Led Zeppelin) turned the music promotion model upside down and did what Bernie did subsequently. Nowadays the music promotors are back in a stronger position with big players owning most venues. Bernie is trying to put the clock back maybe just to make mischief but things could get interesting.

96

James, I don't understand Bernie's angle here. He's stirring things up because he wants a role in helping promoters negotiate for better deals? That would make some sense since he knows his way around all their contracts but does he really have the energy and longevity for that? Also, wouldn't Liberty have made him sign some kind of non-compete contract when exiting?

97

HaHaHa, Joff, if BE was immortal then he'd recapture the shares again and make another few billion.
" James, I don't understand Bernie's angle here. He's stirring things up because he wants a role in helping promoters negotiate for better deals? "

98

He owns Paul Ricard as well. Of course he is taking this angle now. So would you. It's in his best interest. Not bad, surprising or unusual.

99

Bernie Echolstone is the Judas ....

100

Bernie needs to be made Persona Non Grata in the paddock.

His time is passed and he holds no relevance, nor will any of his statements be designed to have a benefit to F1.

The sooner the motorsport press stop reporting on him, the better.

101

The press like Bernie as he can give then headlines. Yes rubbish headlines sometimes but the press and their readership are not that fussy! We've heard little of 'headline' interest from Chase Carey so if Bernie wants to liven things up with a bit of mischief that is OK with me. Bernie knows where a lot of bodies are buried and still has some influence that is not to be underestimated.

102

Funny how he starts to admit he's overcharged NOW.... Didn't mention a thing about it whilst his snout was six feet deep in the trough. Good riddance [mod]

103

So you don't think that Bernie has has a 'road to Dmascus' moment and decided to repent his sins for the greater good 🙂

104

I was running the company to try and make money for the shareholders. It doesn’t seem that’s the thing that’s driving them. He (Carey) wants to get more happy spectators I think,” said Ecclestone.

Therein lies the problem of what has driven the sports viewing figures into a seemingly endless abyss.
That short sighted approach is why Bernie had to go and why Liberty with Carey at the helm is the tonic the sport needs so it can lay a far more solid foundation to regenerate and reinvigorate the Formula back to where it belongs, as the premier motorsport series in the world.

105

Ecclestone sees Formula 1 as a product to be sold to rich financers, ideally autocratic states with a lot of money drained from their own people and made available for a global elite. Fans, spectators, whatever - just dross for other people to worry about. Ecclestone has no qualms in making that opinion clear. Equally I have no qualms in saying Formula 1 - as a sport millions of people enjoy - is well rid of him and his hideous worldview.

106

Bernie only looked out Bernie...

107

Who else would look out for Bernie...?

108
Craig in Manila

Since Liberty came on the scene, I have commenced wondering if, one day in the not too distant future, we may see :
- a season with two conferences (F1 East and F1 West) and, as a result, races every weekend for most of the year culminating in a final series where both conferences come together
- regulations/payments being changed for the betterment of the overall sport (not just for particular entrants/manufacturers)
- an entry grid with new multinational sponsors and new Asian manufacturers from Korea, India or China
- Events and entertainment that make it worth my while to pay the entrance fees
- Great (unused) tracks getting back into the roster
- Governments not being required to subsidise races
Etc etc etc

Bye bye Bernie.
Thanks for your efforts in the past.
Shut the door on the way out please.

109

Could this be Bernie being a bit disgruntled? I think the new stance is the way forward and how much I'd hoped Bernie employed someone to get on top of the digital market a decade ago. Imagine how the sport would be in now (in the digital landscape)...a lot better.

110

oooooh shut up you old..... go there and enjoy the race.

111

Sounds like someone should have locked the door after it closed behind BE.

112

He's just trying to destabilise things. If he's now suggests he was overcharging (which he clearly was), he hopes this will make things more difficult for Liberty, when they come to the next round of negotiations. Petty, but not unexpected...

113

Says it all about the man Bernie become.
Built our beloved sport up, got filthy rich. Sold to CVC, then carried on screwing the sport over. Now he's wailing [mod]!.
Does he really think we're all stupid? He's just confirming what we already knew. As many other posters have written, shut up and good riddance Bernie! Enjoy your retirement with all your hard earned cash👏

114

James k .... "Enjoy your retirement with all your hard earned cash"

Er, earned?

115

Bernie and Alonso should spend their evenings together. They would get in a good moaning session then get on with their lives.

Bernie should have done this talking and had his "come to Jesus" moment when he was running things. Formula One is now another person's bride. Alonso is ruining what's left of his image with the nonstop moaning. Everyone knows the MCL-whatever is a dog. Yes - you will get passed by a cloud at Spa.

A former CEO disparaging the product he just unloaded... I guess moaners gotta moan...

116

I would just like to say how refreshing it is to hear Carey saying they are taking a "long term benefit" view of things, that just doesn't happen now a days in any walk of life from government to business and, as we know too well, sport. Everyone is after a quick buck, to hell with the consequences.

I have argued and I think pretty much everyone agrees that the venues being ripped off benefits no one other than the F1 shareholders. Cheaper venues = cheaper tickets = more fans through the gates = more investment in facilities = benefit to all levels of Motorsport = good for Motorsport, etc. For F1 itself then if the prices are less then circuits don't need the ridiculous long term contracts they are after at the moment, thereby we can have more variety in the calendar from year to year.

As much as I would love to see a return to classic tracks I think it would be easy and damaging to get too carried away. If we think back to the 80s, 90s and even early 00s it was basically a European championship with a few token "away days". For all its faults, it is most certainly a World championship at the moment. A few less races for Bernie's Oligarch pals and at tracks that are officially rubbish, and a few more in the heartlands and I think it would be a perfect balance. If they can make it work financially I see no reason why a region can't have say 5 tracks with any 3 getting a Grand Prix on a given year.

117

come on this is a non-starter
the new owners are running the company for the fans, literally how any sporting franchise should be managed, for the fans, cause without them there is no sport to make profit on

how is this even news, bernie should be smarter than saying he was running the sport for profit, we already know circuit's and their governments couldn't match his demands and having the f1 circus come along stopped being a boon to any economy because fans couldn't match bernie's demands either as far as ticket pricing went

baffled by bernie here, dumb to open his mouth at all cause this will just lead to resentment from anyone that breaks down what he said

118

It seems we are beginning to see just how under developed F1 was as a global brand. Just from Facebook alone, there has been a massive increase in exposure as mini-highlight clips appear in my feed, alongside humorous clips and interesting articles.

Liberty seem absolutely bang on in that there needs to be some short term investment to enable long term gains and F1 is lagging far behind its sporting rivals. I feel there does need to be an adjustment and F1 move closer to it's European homeland. A couple of circuits aside, the middle eastern tracks along with Sochi and Baku are poor optics for the TV viewers and that doesn't bode well in an environment where F1 is fighting tooth and nail for attention. Tracks like Monaco and Belgium simply look more appealing to the viewer (even if in Monaco's case the race is a bit flat).

Sometimes it is very obvious even from this site that the feeling from the circuit is in stark contrast to what the average viewer experiences at home. I attended the 2006 British Grand Prix which was one of the dullest races of the season yet was a fantastic experience at trackside. I can only imagine how it would feel to be within the F1 bubble in terms of the sports media at some of these excellent purpose built venues. But for the folks back home, these new races are completely lacking visually and on the racing front also a little artificial. Add in the lack of any history at these tracks (which builds the viewers emotional connection) and you lose attention.

If you look at the world cup for example, the average fans are much more enthused when the final is held in one of the great historical stadiums be it in Brazil or Europe, than they would be at less historical venues (such as the upcoming Qatar world cup).

119

People on here are praising Liberty but the fact is they are allowing F1 to continue with the pay TV model which I , many other fans and Joe Saward know doesn't work for F1- look at the decline in uk viewership -especially since only 10 races a season have become free to air as well as the free races now being on C4 It's alright doing great stuff at the circuit but what about access for fans who can not get there . From 2019 all races will be on sky and that is when you can expect attendances at Silverstone to start declining and when that happens Liberty will realise their mistake in keeping Bernie's pay TV model. If they do not do that and reduce ticket prices for certain European races - they will have failed F1 and its' fanbase. Lets not praise Liberty too much until/unless those things are done . Also I have noted the top comment of Gaz Boy and all I would say is don't get your hopes up-especially considering Liberty are interested in taking a F1 back to Turkey - where one man and his dog turned up for the last race we had there in 2011 despite a decent circuit. Just because Liberty and not Bernie are in charge doesn't mean F1 won't be happy to deal dictatorial regimes. I still wouldn't be surprised to see a F1 race in Qatar at some point.

120

Very interesting. I read the article, then the comments and then re-read the article. Lots of information in here. I guess it's indeed a difference of doing business, only looking at the shareholders and their short term interests (BE) or taking the long view (CC). I guess a lot of people see that F1 needs a change, the few simple tweaks made before this season (regarding filming in the pitlane for example) already show the sport is modernizing. In the end the f1 shareholders are a select group of people who should be looking at the long game as much as the short one.

121

I saw the C4 interview with him on the weekend. He came across as like being the elderly neighbour who shouts at the kids to turn the music down and stop making so much noise. He's like a Scooby Doo villain now. Passing the buck onto the shareholders was a step too far, he made a lot of money off those deals and I am sure that it was on a percentage basis. Never mind the exclusive TV deals for Sky et al. In less than 2 years a lot of us won't be able to watch a race live, if at all because of this guy. He takes and takes and takes and expects us all to feel sorry for him? Please! Pull the other one, it has bells on.

122

While the politics can be an interesting diversion to the day to day F1. I don't see this has adding any kind of value to F1, now or in the future.

In a similar fashion to how the radio messages are broadcast to enhance the GP and not advertise the mundane of the drivers being told to select this and that mode. We should all choose to filter out Bernie's self centered, outdated drivel.

I for one am really excited by the long term prospect of the sport.

123

I'm pretty sure it is just sour grapes on Bernie's part.

124
Ricciardo Aficionado

So after gouging as much money as possible from the sport yet investing nothing in its future, Bernie now announces he's overvalued the product he's just sold.
We have a word for his kind in my town...
[Mod]

125

what is it what's the word?

126

Good Old Bernie! LMAO! What we call "the pot calling the kettle black", just another way of saying hypocrite. I hope I'm that cheeky when I get to be 80 whatever he is.
On another note, you got to love the picture of Carey, whoever and Ross Brawn. The two rich guys who've got more money than God and "own" F1 and Ross Brawn (who is a millionaire himself) standing with his hand in his pocket looking ever like the supremely confident team principle and your rich uncle who only wants the best for you. Hopefully he's not swayed by these two businessmen and guides F1 to the heights only a racer can.

127

#teamBernie

128

Its impossible to know what Bernie is up to right now. Is it just sour grapes, an attempt to control the circuits or something else.

Similarly, its impossible to know if Liberty will do a better or worse job than Bernie, whether they will sell the company, or keep it for long term value.

Two things are certain, Bernie doesn't mind making some powerful enemies or looking ridiculous.

129

Bernie is just being his usual mischievous and attention seeking self... And, wasn't he one of the shareholders than profited from the deals where he charged too much and ultimate the sale to Liberty?! Liberty's focus on creating long term value for all the various stakeholders, as opposed to short-termism, seems right on to me!

130

There is nothing inherently wrong with trying to tap into new markets, but one has to be careful in doing that not alienate your existing market(s). Sure some of the new tracks have been good some not so good but that wasn't that the same with the older circuits. So the question is how many races can teams support? Now perhaps they could support more with a bigger slice of money but even then I don't think we are likely to see much more that 22 or 23 races a season.

131

I expected more from the new management particularly when it comes to FOM coverage.
Camera Angles -
At the start, in particular, you NEED a high shot to see who is moving forward faster than another. Every race now, we get these low shots of the lights going out. It's useless. With regard to the onboard chatter above, FOM seem to prefer these close FOV (Field of View) shots in recent years. The onboards from the 00's were very wide angle and really conveyed speed. It just works so much better on TV.

Director -

Perhaps there is a new person in the job, but China was abysmal. It seems obvious to me that whoever it is isn't a 'racer' at heart because they choose to cut away from things when you (i) can clearly see a situation developing. A prime example was Vettel on Kimi. Kimi got a poor exit of T2 "here we go, this is it" I thought. Director cuts to Kvyat parked up behind a barrier. Cuts back to the Ferrari's and Vettel is past Kimi. Other times, commonly, we'll cut to someone pitting from the midfield at the expense of significant track action. Another example is when there is a pit stop undercut/overcut scenario where you need to the director to switch to the long shot of the S/F straight to see the other guy bearing down on them. Several times in China, this was far too late or just didn't happen at all. Don't get me started on the lingering fan/celeb shots.
Camera sync -

I saw someone else raising this last year. How haven't they sorted it yet? The Onboard shots are about 0.5-1.0s behind the rest of the feed. An instance was Vettel overtaking Ricciardo. Switching between onboard and outboard was perplexing because one second, Vettel was lining him up and immediately he's ahead around the outside. It's just plain confusing.

132

The need to create a new fanX on site ,tv broadcast with different camera (viser cam).Top secret era should be over,did anyone saw the post race show on SKY,he was walking & we couldn't see anything in the garage.Wow brillant coverage... Fan zone is a disaster compared to other motorsport serie

The value ticket price vs experience at the GP doesn't make any sense,They do nothing to get new fan .We pay more to get less every year since 1995. We 've been fan since 1979.

The calendar needs the key Grand Prix,we need more grand prix at the ring,Imola,Estoril,Buenos Aires¯Kyalami & 2 more grand prix in the state one east coast Nyc & a night race in Las Vegas.Long Beach,Detroit & Watkins Glen are now presenting Indycar.They don't have any interest to present the F1 races at their tracks.I also love Brands Hatch even Donington Park better than Silverstone

How many races on the 2017 calendar is relevant to the passionnate fambase? for me these are the one : Monza aussieGP,Interlagos,Mexico City,Spa,GVC,Cota,Monaco,Suzuka,Catalunya

133
Tornillo Amarillo

Carey is right. I think Warren Buffet could agree with him 🙂

134

Bernie is yesterday's man, he knows that and he knows his statements are wrong, but Bernie is Bernie and that won't stop him having some fun. If he's not making money he's making mischief!

135

Interesting that Bernie voluntarily reveals more of this true colors. The comment about running F1 for shareholder profit and about hacing seen social media as a cost to be avoided because of little upside really reveal how out of touch and bad for the sport Bernie was (in some ways. Bernie surely had successes but he is now shining a spotlight on his own glaring failures! The current Formula 1 YouTube channel with tons of interesting videos is reason enough to say good riddance to Bernie and even more so with this extra fuel that he adds to the fire.

welcome to the future folks (-8

136

Would it work to rotate Grand Prix’s over several tracks through the years? A USGP at Indianapolis in 2018, New York 2019, Long Beach in 2020 and then through them again would be great in so many ways (Fresh local crowds every 3 years, no recent data to set up the cars etc), and give the chance for a bigger one off fee every 3 years.

137

Bernie invested in digital broadcasting. He was persuaded to upgrade to higher res and broader bandwidth and got burned to the tune of several $ tens of millions.
I think that made him very gun shy about new technology and changing what worked for him.
He had a lot of countries banging on his door wanting to host an F1 race. The demand far outstripped the supply for a long, long time. He could play the prospects off of one another because if one buyer wouldn't meet the fees, another was waiting in the wings who would.
Unfortunately, the historic tracks in Europe were sacrificed in order to make wads of money in the Middle East and Asia.
Of course CVC Capital Partners pushed him hard to deliver maximum profits, often I believe, to the detriment of F1 and its brand.
The race in the US in Austin had to have Texas state money to make it a viable event. Even with $ billionaire backers and top name entertainers putting on concerts.
Texas will not do this indefinitely. As was evidenced by cutting 20% from the money it was going to provide to support the event.
Times have changed. Few venues are still willing (or able) to pay the exorbitant fees when they get so little in return. Even the races backed by a government are rethinking their involvement.
I believe Liberty Media is approaching this properly. Giving everything a rethink. Looking at every aspect to determine how to get more entertainment for the audience, as well as what should be done to make the events viable for the track owners. As Mr. Carey said, thinking about the long-term health of the sport. Not just maximizing short-term profits.
Kudos to them for doing so.

138

Hi James. I really like your site. Great information and insight. I have only been a TV watcher of F1, but two of us are going to the Canadian GP. So I will let you know if our experience was a good one from a newbie's point of view! Tim

139
Balraj Dhaliwal

Finally Bernie admits that he has been overcharging the venues. We all knew it, they all knew it it's nice to get an admission. This proves that Bernie is not the right person to grow the sport. He should have been replaced about 5 or 6 years ago to set the sport on the right track but better late than never. Well done Chase and Liberty.

140

Bernie seems to have 'short term profits' for an awfully long time.

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