Subject To Change
Subject to change
TDC
Kevin Cameron
A FEW YEARS BACK, A MAN NAMED Bernie Ecclestone saw something valuable that others were ignoring. It was like seeing a $100 bill on a sidewalk crowded with hurrying people who didn’t look down. No one saw the money, so Mr. Ecclestone picked it up. The bill was Formula One auto racing, which at the time was only moderately popular, and was managed as tradition-rich old sports so often are, by well-meaning gentlemen in blue blazers. Responsible men who, when interviewed, explain that having been racers themselves once, they feel obliged now “to give something back to the sport” by serving as officials.
Ecclestone understood that Formula One, suitably magnified by the lens of television, could be turned into a huge advertising and distribution industry. This is often how business success is achieved: One person with a degree of vision sees value where no one else does.
Later, Ecclestone and others saw Grand Prix motorcycle racing as another undervalued property-a high-denomination bill lying ignored on the sidewalk. In the scuffle of negotiations that followed, the unworldly gents in blue FIM blazers found themselves outmaneuvered and reduced to the role of figureheads. In their place were comprehensive television rights and adsignage agreements, plus the wild card of the new International Race Teams Association, or IRTA. Suddenly, GP motorcycle racing was big business.
This is how revolutions happen. The traditional ruling group fails to notice or to accommodate new sources of power that are emerging around them. By the time the newcomers are ready to assert their claims to power, it’s too late to resist them. The best that fallen royalty can expect is to be allowed to keep their blazers.
Now to our own case. Here in the U.S., AMA Superbike racing is a highly competitive, colorful and thoroughly factory-populated sport. For almost 30 years, the cry has been, “When we get TV, then we’ll have everything.” But even mighty NASCAR had to work hard to get on TV, making sure the sport was presented in such a way that there was something for every member of the family-personalities, pitlane drama, incar cameras, technical tidbits and so on. This, in turn, guaranteed a much larger potential sponsor base. NASCAR did it well and deserves all the success it’s had since. By contrast, delayed broadcast on odd cable channels isn’t the same thing as really making it on TV
The well-publicized 1993 schism (and ongoing legal action) between the AMA and its former race director, Roger Edmondson, can be looked upon as a reaction to what happened to the FIM. In an arm-wrestling contest between a traditional sanctioning body and a wily businessman, whom do you expect to win? The lesson is plain: Stand clear of wily businessmen! In the end, the AMA has worked hard to prove that it doesn’t need Edmondson’s CCS organization to run roadraces.
Is that the end of the story? Not necessarily, because the trend today is toward vertically integrated entertainment organizations, like Octagon, which controls World Superbike. The game is to own as many elements as possible in the chain that extends from the actual sport itself all the way to the home viewer’s television screen. That way, the organization makes money at each step. Imagine a corporation that owns racetracks, negotiates sponsorships, and manages television and signage rights. Would such a corporation prefer to negotiate with men in blue blazers-or to own them? You know the answer.
Just as hospitals are being bought up by health-care corporations, so U.S. racetracks are being absorbed by larger organizations. NASCAR’s France family may have started this, but they are no longer the only players. Today, tracks aren’t just a way to pay the taxes on dusty real estate until it can more profitably become a housing development. They are one element in a growing entertainment business. The existence of multi-track ownership groups makes it seem more likely that some kind of Octagon-like setup will be to someone’s advantage. In modern business, if you don’t grow, you shrink. Vertical integration therefore looks tempting.
What does this mean for a sanctioning body like the AMA, with its Superbike race series, arguably the most competitive in the world? When various forces vie for power, the best way to survive is not to fight, but to form alliances. Fighting eats up vital resources and risks total loss. Forming alliances leverages the power of others. The game, in this case, is to appear so clearly competent and cost-effective at producing the race series that it is cheaper and safer for any hypothetical “vertical integrators” to buy your service, rather than try to reproduce it themselves. It wouldn’t do to have businessmen thinking about running their own races, or making attractive offers directly to race teams or manufacturers.
Of course, motorcycle roadracing in the U.S. could very well continue to plow serenely through calm backwaters. It may enjoy modest television coverage, and remain a manageable, smallscale success for the foreseeable future. The hypothetical shark-like forces of the entertainment business may continue to regard it as too small, too risky, basically too strange ever to be worth a sudden rush and a snap of the jaws. One promising strategy might well prove to be-intentionally or accidentally-keeping things small. Should we expect motorcycle manufacturers to agree? Perhaps out of loyalty?
Small is basically okay with me. I’ve never wanted this sport to be fully professionalized, taken over by strivers in Learjets, desperately seeking cash. By comparison, well-intentioned gentlemen in blue blazers look pretty benign. I have never thought roadracing could be improved by wardrobe superintendents, lighting directors or charm coaches. I like being able to walk up and talk to team managers, riders, mechanics and engineers without having to deal with layers of publicists or handlers. But like so many things, these conditions are subject to change without notice. Cross your fingers.
