Liberty tells teams "no free lunches" over $43m income drop

Formula 1 chairman Chase Carey says teams must understand that there are "no free lunches" when it comes to making the sport bigger, amid unease about a $43 million fall in their prize money pot.

Liberty tells teams "no free lunches" over $43m income drop
Valtteri Bottas, Mercedes F1 W08, leads Lewis Hamilton, Mercedes F1 W08, Sebastian Vettel, Ferrari SF70H, Kimi Raikkonen, Ferrari SF70H, Daniel Ricciardo, Red Bull Racing RB13, Max Verstappen, Red Bull Racing RB13, and the rest of the field at the start of the race
Chase Carey, Chairman, Formula One
Daniel Ricciardo, Red Bull Racing RB13, Kimi Raikkonen, Ferrari SF70H, Max Verstappen, Red Bull Racing RB13, Nico Hulkenberg, Renault Sport F1 Team RS17 at the start
Valtteri Bottas, Mercedes AMG F1 W08, Lewis Hamilton, Mercedes AMG F1 W08, Sebastian Vettel, Ferrari SF70H, Daniel Ricciardo, Red Bull Racing RB13, Kimi Raikkonen, Ferrari SF70H, Max Verstappen, Red Bull Racing RB13, the rest of the field at the start of the race
Chase Carey, CEO and Chairman of the Formula One Group
Start of the race
Valtteri Bottas, Mercedes AMG F1 W08, Lewis Hamilton, Mercedes AMG F1 W08, Sebastian Vettel, Ferrari SF70H, Daniel Ricciardo, Red Bull Racing RB13, the rest of the field at the start
Chase Carey, Chief Executive Officer and Executive Chairman of the Formula One Group

A number of outfits have expressed concern about an unprecedented drop in the commercial rights income for the most recent quarter.

In recent financial documents, the pool of income to be shared out among teams will be $273 million (USD), which is 13 percent lower than the same period last year, when it came in at $316 million.

Carey is well aware that such a fall is not what teams want in the short term, but he insists that without investing in the sport, there is no way that Liberty could hope to make the prize money pot bigger in the longer term.

"I think the sport has been underserved by a continual short-term focus," said Carey in an official F1 Q&A interview. "I think we've got some fresh momentum back into it.

"A lot of things were not going in the right direction in recent years, but this year attendance is up, viewership is up and I think we've got a much more positive spirit behind it. The sport needed fresh energy and investment.

"To grow things, well, to use an American phrase, there are no free lunches. We didn't have an organisation that was able to properly develop, to build the sport.

"We had no research, we had no marketing, we had no digital organisation and realistically if you don't have capabilities like that, you are going to fall behind.

"When you're building a digital organisation, usually you have costs before you get returns. If you're building research capabilities, normally you have to invest in those before you get to use them. It's the reality of building capabilities that haven't existed.

"To do things like the Trafalgar Square demo, to do things at broader fan fests, requires investment. However, all are investments in the future of the sport.

"From the teams' perspective, sure, everybody would like to have free lunches and get the growth without the investment.

"The world doesn't work that way. I think that there is an understanding of and an appreciation for what we're doing, and in many ways we're very much agreed on what needs to be done for the sport."

Liberty Media plans to sit down with the teams in December to explain more about its vision for the future, and what it hopes to achieve in both the short and long term.

And while there have been some criticisms that Liberty has not changed much in its first 12 months running F1, Carey says that it is only now that it has got the staff in it needed to move things forwards.

"When we started the year, the first three months of the year we had three people," he said. "If you look at things like the marketing and research and digital, our head of digital started three months ago, our head of marketing started four months ago.

"We have been putting the team in place as the year has evolved and in many ways a large part of our operating organisation is new. Before, we really didn't have a large part. We had a financial and legal staff but we didn't have an organisation able to support the business operationally."

 

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