F1 shouldn't be a niche sport
OCTOBER 27, 2016
BY LUIS VASCONCELOS
Malaysia has now decided it's not worth it hosting a Formula One Grand Prix in Sepang, but will still remain in the calendar for another two years, as the financial penalty associated with breaking the contract would FOM would be higher than the losses the circuit and the promoter are expecting to suffer in the next couple of years. Considering Sepang International Circuit has just spent quite a bit of money resurfacing the entire track and building new hospitality facilities for the teams, if the Malaysian government is ready to pull the plug on the Grand Prix, it's because the race generates major losses and they've decided it's better to soldier on with other forms of racing, particularly Moto GP rather than keeping on losing money to host a Formula One Grand Prix.
It would be difficult to argue that the Malaysian Grand Prix is a Formula One classic, but the truth is that in 2018 we'll be going there for the 20th time and that means Sepang has its place in the history of the World Championship. From Michael Schumacher's sensational comeback from injury in the inaugural Malaysian Grand Prix, to Red Bull's "Multi 21" controversy, in 2013, Sepang has seen many exciting Formula One races, especially when the weather becomes a factor, as it has so often been the case.
Unlike many other modern tracks, Sepang tends to offer great races, with at least three obvious overtaking spots, so I won't be happy to see it go from the calendar. It is true the Malaysians never really filled the circuit, but how could expect anything but that if a three-day ticket for the Grand Prix costs, on average, $200 USD and average salary in the country barely reaches $1000 USD?
One may argue that the Singapore Grand Prix does a very good job keeping Southeast Asia on the calendar and it's not a secret Heineken, which is investing heavily in Formula One, would love to see a race in Vietnam, but what we all heard in Singapore was that the local government was considering dropping the event at the end of the current contract - that runs out at the end of next year - because the costs involved, including building and bringing down the track every year, were too high and the number of foreigners flying in to watch the Grand Prix had dropped by more than ten per cent per year in the last two years.
It's been clear for quite a while that only state-funded Grand Prix have the means to stay in the calendar for the long term - state or local government foot the bill in Australia, China, Bahrain, Russia, Canada, Azerbaijan, Hungary, Singapore, Malaysia and Abu Dhabi and give vast subsidies in Spain, Germany, Belgium, Italy, United States, Mexico and Brazil. This means that only four races, including Monaco, that gets the event nearly for free, are funded by private investors - the others being Austria (paid by Red Bull), Great Britain and Japan.
Government have their own agendas and when an event has served their purpose they'll drop it, and now, on top of Malaysia clearly opting out of Formula One, we have not only Singapore, but also Canada and Brazil considering the possibility of taking the same route. According to some sources in the paddock, Russia will also pull out at the end of 2017, one year before the end of its contract, as the country will gear up for the Football World Cup the following year, and Azerbaijan won't renew after its three-year contract, with 2018 being the last Grand Prix held in the streets of Baku.
What this state of affairs indicates is that the path that has been followed for the last 15 years is a dangerous one for the sport. As I've stated before, Formula One dropped out of places where the audiences were great and the sport had great following - Portugal, France, the second race in Italy and Germany - to pursue new markets that were never conquered, China being the only exception. The sport never picked up in Turkey, Malaysia, South Korea, India and they all dropped out, but attendances are always very poor in Bahrain, Russia, Azerbaijan and Abu Dhabi, remaining in the calendar for political reasons, for as long as they serve a purpose.
The new owners of the Formula One Commercial Rights seem to be having a tough time getting past Bernie Ecclestone to gain full control of the sport, but given the money they are investing they'd do well to take a couple of simple but immediate measures: lower the promoters' fee to make it accessible for private investors and cut the dependency from governments and their political motivations, impose a ceiling on ticket prices to get more spectators into the grandstands, have other events in the circuits - the Taylor Swift concert in Austin is thought to have brought more than 20.000 people to the Grand Prix, as the price for the two events together was an attractive one - and, crucially, offer a basic coverage package to be shown on free TV in all the countries, to allow people to at least see qualifying and the races without having to pay for it. The hardcore fans would still use Pay TV to listen to the interviews, radio communications, press conferences, paddock-based programs and so on, but the TV audiences would grow back to what they used to be, and everyone would be able to watch qualifying and the races for free.
Without these simple measures, and others that Liberty Media could easily come up with, Formula One will go back to being a niche sport, as it was in the Sixties and the Seventies and that's not something we all want. It took so much time and effort to turn Grand Prix racing into a global sport, that it would be a sad waste of everyone's time and money to go back to the days where the TV viewing numbers were low. But at least, back then, the circuits were packed with spectators as everyone could afford a ticket and access to the paddock was almost unrestricted, giving the paying fans a experience they would never forget.