One Man, All the Power: F1’s Broadcasting Battles

A historical view at the trends of consolidation in money and power in the context of Formula One racing’s broadcasting and television rights.

Formula One’s relationship with television broadcasting has always been complicated. But this is F1, so of course it’s complicated.

The work of a single man, Bernie Ecclestone, completely changed the ball game, skyrocketing both him and F1 into the stratosphere of sports money.

F1 had long been limited to British television since its inception in 1950, and its coverage was nothing near as comprehensive as what we are offered today. Not every practice session, every qualifying, every race. Often times the British and Monaco Grand Prix and possibly the season opener and finisher were the only races shown. But not much else. Not until the 70’s did fully-aired races become the norm, with the 1973 Dutch GP acting as the pioneer for live F1 races. It was broadcast by the BBC, but its running was very much marred by the death of racer Roger Williamson. The intermingling of danger, death, and speed was shoved in the faces of viewers, and many were turned off by witnessing it live on their televisions. Numbers would jump with the exciting rivalry of Brit James Hunt and Niki Lauda, and it ushered in an era of more consistent and higher quality commentary for watchers.

The BBC would retain sole contract of airing until the end of 1996, before ITV stepped in, taking over the broadcast rights in a strong way. It would return to the BBC in 2008 with a deal lasting 5 years, and it introduced faces we are still familiar with today: Martin Brundle (and his infamous grid-walk) and Ted Kravitz, to name a few. They would air not only just the race, but the other sessions. Channel 4 would enter the ring in 2015 to replace the BBC, further partnering with Sky Sports.

Intermixed with all of this was the large presence of a single man. Bernie Ecclestone’s impact on the sport cannot be overstated, especially in the realm of the broadcasting and television development for the sport of Formula One. His career as a racer himself was short-lived, and he was deeply impacted by the deaths of friends and drivers so much so that he stepped away for a time before returning.

Beginning as a driver manager, he forged relationships with teams and professionals, buying the Brabham F1 team in 1971 where he employed famous drivers in the likes of Graham Hill (the only winner of the Triple Crown in motorsport history), John Watson, Niki Lauda, and Nelson Piquet. Piquet would go on to win 2 out of his three championships with Brabham.

Ecclestone’s connection with former driver Max Mosely placed him a position to interact with the Grand Prix Constructors Association. He brokered various deals, working between multiple groups including the FIA to restructure financial apportionments and representation. He headed the Constructors Association over the issue of the sport’s commercial rights and the income brought in through airing races live on television.

The deal he managed to secure benefitted him tremendously. He made the decision to head the company to manage F1’s broadcasting rights, creating what is now known as the FOM, or Formula One Management. The revenue was split among three parties.

47% to be split between the teams. 30% to the FIA. The remaining 23% was paid to the FOM, which was 100% owned by Bernie. Naturally, most of the cash landed on his doorstep. It gave him complete control over F1’s rights for the first time in the sport’s history.

Equally as important was the settling of the Concorde Agreement (the first of many) in 1981, a consensus reached where teams were obligated to race, and this was taken to TV companies who could guarantee coverage to F1. Bernie’s strength of building these agreements filled his pockets and directed Formula One into a world where its commercial success was unparalleled. He dealt with TV channels directly, and even introduced on-board cameras through skillful investments and insights.

Even with his deft hand and timely decisions, it has not been smooth sailing across the track. The sport has had its fair share of debt, fallouts, and loan refinancing, and as a result, it was taken over by CVC in 2006, a private equity firm. They bought out the F1 group for $2 billion. In 2017, Liberty Media took the wheel, buying F1’s parent company through part of a $4.6 Billion acquisition. They paid $301 million of their own cash alongside incorporation of total debt and market capitalization.

Liberty was determined to change big chunks about F1, hoping to expand its fanbase and increase global interest. They have not been entirely successful in their efforts, burning up nearly $105 million already of combined operating losses that are due to increased costs across the board. Certainly COVID-19 has been no help, forcing the sport to delay prominent regulation changes and to forgo fan attendance at the majority of faces. Furthermore, dollars are raked in from the revenue of race hosting fees — in F1, the tracks pay the sport owners, not the other way around. That income only was increased about 1.4%, bringing the total to $616.7 million, despite the fact that the number of hosting tracks increased by one. This was because the Malaysia GP, one of highest payers with an annual feel of around $46 million, dropped out, and was replaced by France and Germany, who don’t have that big of price tag.

To close, it’s even been seen that F1’s global television audience has declined dramatically since 2008, where it had around 600 million viewers. In 2016, it was noted to be around 390 million. That’s a crazy drop, and it largely caused by two issues: 1) big pay-TV providers dropped F1 in 2013, and 2) fans are becoming less and less interested in tracking the lack of competition that many seasons have been characterized by. The F1 group has since launched their own streaming service with various package options, but it has gone through several iterations to get to its current state, which isn’t all that fabulous.

I have high hopes for the future of F1, much of which I place on the incoming regulation changes for the 2022 season. Fan engagement and interest is deeply engrained in many of the revenue issues the sport is grappling with at the current moment, so I am optimistic (or at least attempting to be) about what is to come.