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Commentary

Liberty from Bernie Ecclestone is good for Formula One

So what ramifications does American giant Liberty Media Corporation's purchase of CVC's shares have for Formula One as a business entity?

Chase Carey, the executive vice-chairman of 21st Century Fox, is the new chairman of parent company Delta Topco, but indefatigable ringmaster Bernie Ecclestone will remain as chief executive officer. That makes great sense, for starters.

Liberty has wide-ranging interests in media, communications and entertainment, and thus the polished skills to market the sport, a growth area long neglected.

One of owner John Malone's motivations is to acquire access to content for his myriad global TV networks, and a properly marketed F1 has great potential to attract new viewers.

It is also inevitable that the United States will play a much bigger role in F1, and not before time. It's the biggest consumer market in the world, and has huge potential among its millions of customers to grow the sport significantly.

Traditionally F1 has outpriced itself there, so it will be interesting to see how Liberty addresses that. Will the philosophy of elitism give way to more populist pricing structures along MotoGP lines?


Bernie Ecclestone can probably finalise negotiations with his eyes closed - after running Formula One for nearly 40 years. After the Liberty Media takeover, he will remain the F1 chief executive. PHOTO: REUTERS

The US could easily support three races, one on the east coast, one on the west and one in the middle. Should that happen, they are likely to be additions rather than at the expense of European, Asian or South American events. Ecclestone is known to have the figure of 25 races a year in his mind.

Carey has said he admires F1 as a unique global sports entertainment franchise, adding: "I see great opportunity to help it continue to develop and prosper for the benefit of the sport, fans, teams and investors alike."

That sounds promising, but let's be clear: Liberty Media isn't a fairy godmother about to wave a magic wand and make all of F1's ills better.

Liberty's different approach is already clear from their intention to offer shares to the competing teams. That would be a clever means of ensuring that major manufacturers have a long-term commitment.

Ecclestone has said that, like CVC, they aren't hobbyists, but a major global player out to make money. But as a media company they will be far more outward-looking than CVC, whose sole existence was maximise profits for their shareholders.

Liberty's different approach is already clear from their intention to offer shares to the competing teams. That would be a clever means of ensuring that major manufacturers have a long-term commitment.

I'd also hope to see them negotiating a better share of the business to help smaller teams to survive, reduce the cost of staging races and lower ticket prices to attract bigger audiences as the real means of enhancing the sport's growth. We'll see.

In the long term, Malone is obviously going to have his own way of running things, but it makes sense to keep Ecclestone during the transition. Nobody knows better how the sport works, and he will be key to renegotiating future revenue shares with the teams and doing deals for future races.

Greg Maffei, president and CEO of Liberty Media, spoke of their long-term perspective and expertise with media and sports assets, and of wanting to be good stewards of F1 to benefit fans, the teams and the shareholder as it moves towards the next growth phase.

There is unlimited potential in areas such as social media, merchandising and fan satisfaction yet to be exploited, for example.

If this means saying goodbye to Ecclestone and the likes of Red Bull's Dietrich Mateschitz denigrating the sport, and everybody moving forwards in a positive manner, right now I'm all for it.

A version of this article appeared in the print edition of The Straits Times on September 09, 2016, with the headline 'Liberty from Ecclestone in long run is good for F1'. Print Edition | Subscribe