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F1 and Disney - a marriage made in heaven?

BERNIE ECCLESTONE and the Formula 1 teams are in the process negotiating a vast merchandising deal with the Walt Disney Company which could result in a chain of Formula 1 shops being established around the world, selling memorabilia and team clothing.

To date F1 has not been very good at exploiting its merchandising potential with teams tending to do deals with small companies to supply fans with race gear. Copyright abuse has been widespread. A deal with a huge and successful merchandising network such as Disney would mean that teams could make a considerable amount of money marketing their image - while leaving Disney to organize all the details of the merchandising.

Merchandising in sport is not new with American Football teams having been particularly successful in the US. British soccer has only recently realized the potential, and clubs such as Manchester United and Tottenham Hotspur are now making large profits from the merchandising.

The Walt Disney Company opened its own retail stores in the mid-1980s after Michael Eisner and Frank Wells took over the running of the organization and their success has been extraordinary with a film such as The Lion King making $750 million at the box office - but over $1 billion on merchandise relating to the film.

The potential of a strong link with the Disney has other less obvious advantages for Grand Prix racing's future in the United States. Disney now owns the Capital Cities/ABC empire - bought last year for $19 billion - which means that in addition to all the traditional Disney activities, the company now owns ABC television - the nation's top TV network; in addition there are three cable networks and several publishing houses.

Grand Prix racing has traditionally struggled to find a market in America because it has never managed to attract a major TV network. Handled carefully, links with ABC could turn F1 into a huge sport in the United States. In return Disney would not only profit from the merchandising but could also use the sport to beam the Disney name into billions of homes around the world - particularly in the rapidly expanding markets of Asia, where F1 is making big inroads.

Part of this deal may include a Grand Prix being held at Disney World, near Orlando in Florida. Our sources suggest that Disney would use the race not only to broadcast its name around the world but also to fill the hotel rooms in the resorts around Disney World, using the same theories as are currently being employed in Las Vegas with people who rent hotel rooms being given a free ticket to the Grand Prix. Las Vegas and the Orlando region of Florida are the two biggest tourist destinations in the United States and are in competition to have the most hotel rooms available.

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