A report by AutoBlog claims Bernie Ecclestone revealed over the weekend that the sale price for sport’s commercial rights has been approved. He did not say who the prospective buyer is, however. At present, a consortium known as CVC Partners owns 35% of the commercial rights package. It has been rumored for more than a year that CVC Partners is thinking about selling its interest.
Formula 1 Rights Owner Bernie Ecclestone
Some people may be confused about what a “commercial rights holder” is, exactly. Look at it this way. Imagine the National Football League decided that someone else could do a better job of marketing the league than it could. They would select some individual or business to take over the marketing of the game. That person or business would get to collect all advertising revenue, proceeds from the sale of merchandise, and make some of the rules for the game.
Some 30 year ago, Bernie Ecclestone actually convinced the major teams in Formula 1 to do exactly that. Just sign over the commercial rights to the sport and I will do all the hard work of building race tracks, collecting exorbitant fees for promoters and creating the rules for the sport, he told them. All you have to do is show up with your race cars and go racing. You’re gonna love it. Trust me.
Some of the smartest people the world has ever known bought Ecclestone’s load of bollocks and signed all their rights away, which made Bernie one of the richest men on the face of the earth. Why all the money the sport makes should flow into his pockets rather than team coffers is one of the world’s great unsolved mysteries.
Now that the sale price has been agreed upon, all that CVC Partners need to do is decide whether or not they wish to sell. “I think CVC will make a decision on the sale sooner or later,” Ecclestone said. “There are people who want to buy. Actually, two of the people have agreed the price. It’s just a question of whether CVC wants to sell or not.” What an extraordinary business this Formula 1 is!
Formula 1 has been in turmoil ever since the new hybrid powertrain rules package went into effect at the start of the 2014 season. Four time World Champion Sebastien Vettel has gone on record as saying driving the new cars is like “driving a vacuum cleaner.” Attendance at races is down all across the world and viewership on TV has gone over a cliff in many countries.
Adding insult to injury, the sport has adopted a completely idiotic new qualifying scheme that proved disastrous during the first race weekend in Melbourne, Australia. But now it appears the sport is unable to undo the damage and so must live with it, even though everyone agrees it is awful.
Rumors have been floating around for a while about various wealthy individuals who are champing at the bit to buy CVC Partners’ interest, although why anyone would want to invest in a sport that seems to be circling the drain is a question no one seems able to answer. Would new owners help pull the sport out of its tailspin?
“You don’t know what’s going to happen until somebody buys and you see what they are like. How do you know if you will get on with them?” Ecclestone asks? One of the rumors is that Ecclestone himself may be the buyer in waiting. He became phenomenally wealthy when he sold off pieces of the commercial rights package years ago. Now he could regain his position as sole owner and make yet another fortune by selling if off again.
People who don’t care much for Bernie suggest he may have orchestrated the sport’s recent troubles in order to drive down the selling price. When it comes to Formula 1, the most ridiculous, illogical scenario is usually the one that turns out to be correct.