Liberty boss says gambling could boost F1's future income
Liberty Media CEO Greg Maffei says that race sanction fees, broadcast rights and sponsorship can all contribute to increased revenues for the F1 Group, and stresses that the biggest source of growth will be from digital exploitation.
Maffei has even earmarked gambling as a potential source of income that has yet to be tapped by the sport.
While new F1 chairman Chase Carey will be working hands-on with Bernie Ecclestone on the day-to-day running of the sport, Maffei will play a key overseeing role and will provide a link between the sport and the company's other business.
On Thursday, he gave the most detailed insight yet into what direction Liberty's management is planning to take.
"Opportunities to grow the business, I think there are a bunch," he said. "Starting with broadcast revenue, the largest source of revenue.
"Chase Carey is pretty experienced, hard to think of a better guy who's had the opportunity to manage sports properties or media properties, and the intersection of the two.
"I think there's an opportunity to grow that broadcast stream. Much of it comes from moving potentially from free-to-air to competitive pay services, that's for example what happened in the UK, when BSkyB recently bought the rights."
Maffei was keen to point out that F1 can do much more to exploit official sponsorship deals, citing the small size of Ecclestone's sponsorship staff.
"I think we have 17 sponsors, and we have three people working in sponsorship in F1. In contrast at Major League Baseball, a business we have some familiarity with through the [Atlanta] Braves, there are 75 sponsors, just in the US.
"So I think there's an opportunity to grow, invest in the sponsorship organisation, and grow sponsors."
Maffei hinted that the current calendar could be expanded beyond 21 events, but also suggested that "more attractive" venues may be chosen in the future to better compliment the needs of broadcasters and sponsors.
"We're sitting on 21 venues, I think there's an opportunity to potentially grow that over time, particularly while we've maximised some of those venue opportunities with relatively high venue fees, I think there's an opportunity to grow in the number of venues and venues that are potentially more attractive to longer term broadcast revenues and sponsorship revenues.
"The obvious optionality case is to some degree Asia in the short term, potentially Latin America, and longer term North America, and particularly the US, where we really are well under-viewed, under-monetised, under-everything.
"I don't think that gets solved in a week, but I think that's an interesting long-term opportunity."
Expanding on the potential for new races in the USA, he said: "You think about places where it would have natural appeal - I would argue Miami, Las Vegas are very interesting places for the long term. But that isn't going to get solved in a week.
"I'd like to hope that being Americans – Chase, Liberty – that we can help with that process. I don't think as I said this is a quick fix, but for the longer term it's a large, untapped market with upsides."
Inevitably Maffei stressed that digital would play a big role in all three main revenue streams.
"Something that intersects all of these is less than 1 percent of the revenues are from digital, they really have no organised digital effort. I think there are lot of things that can be done around gaming, VR [Virtual Reality] and AR [Augmented Reality].
"There's an enormous amount of video feed and data that we have about the races that we are already capturing that we are not in any way processing incrementally for the dedicated fan, or opportunities around things like gambling.
"Outside the United States there is a huge gambling opportunity in the sport, none of which we capitalise on.
"I think there are a bunch of ways in which digital can play through this, from a service to augmenting other things to providing data that are interesting that we are not capitalising on, that I think will be a part of the future growth."
He added: "Part of that is much more direct to consumer, D2C kind of experiences. How that augments, and how we work that in with traditional broadcasters, needs to be worked through. But I think that there's a lot of material to work with there."
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