MAY 8, 1995
... and digital dramas ahead?
Formula 1 bosses are beginning to worry that the revenue generated by the Grand Prix circus is going to take a plunge because of the advent in the next couple of years of digital television. This will enable hundreds of different channels to be beamed into households by satellite, as opposed to the handful of channels currently available.
Much of F1's revenue is generated by its television deals with broadcasting companies around the world. These deals are worth hundreds of millions of dollars to both the governing body and the F1 teams. F1's TV deals are negotiated between TV stations and Bernie Ecclestone's private company - Formula 1 Promotions & Administration. Ecclestone negotiates on behalf of the teams (FOCA) and the FIA, and the profits are split between them.
In general, Bernie sells the exclusive rights to broadcast F1 to one channel in each country although satellite stations such Eurosport do break down the boundaries. All the broadcasters get the same basic TV feed but some ESPN, Britain's BBC, France's TF1, Italy's RAI and Japan's Fuji TV edit in their own segments to produce their own shows.
The advent of digital television will mean that viewers will have access to many different versions of F1 coverage, although they may not be able to understand all the different commentaries. Inevitably this will reduce the attraction for TV stations to pay Ecclestone's rates - and that will mean that there will be less money about.
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