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Vodafone and Formula 1

THERE are rumors in British marketing circles that the Vodafone Air Touch company may be on the verge of signing a sponsorship deal with Benetton in an effort to increase its exposure around the world. Vodafone is expanding rapidly and has recently announced a major mobile phone deal in Japan. According to the reports in Britain Vodafone's interest in Formula 1 may have been sparked by rival (and former subsidiary) Orange's sponsorship of Arrows.

The story should be treated with some care because Benetton is believed to already have a title sponsorship with Mild Seven for the 2001 season. If this deal is yet to be confirmed it may be that the Vodafone rumors are being as a lever to hurry Japan Tobacco into agreeing a new deal.

Mild Seven's deal is believed to be based on results it is probably not producing as much money as team boss Flavio Briatore wants to run the team. He is not beyond cancelling a contract that does not suit him and so Vodafone might be a player although in the longer term the deal does not make much sense as Renault purchased the Benetton team with the intention of using it to promote Renault products and was expected to become the team's title sponsor when it takes over Benetton at the end of this year.

In addition there was thought to be a deal in place between Benetton and MCI Worldcom, which had been dropped by Jaguar Racing in favor of a new deal with AT&T. But MCI's involvement in the sport has been little more than lukewarm in recent years and it is unlikely that it would compete with a big financial offer from Vodafone. Our sources also say that MCI is cancelling some of its other F1 programs and so it may be that the US company has been bounced out of F1.

The other point of interest is that Vodafone is already involved in F1 sponsorship via D2, the German mobile phone company belonging to Mannesmann, a Vodafone subsidiary since May last year. D2 was a Benetton sponsor last year but has long been associated with Alexander Wurz and it was expected that with Wurz moving to McLaren the sponsorship would go with him as McLaren has no major deal with a mobile phone company and D2, which has a long association with Mercedes-Benz, would be the obvious choice. It should be added that McLaren is also able to guarantee rather more exposure than Benetton at the moment even if space on the McLarens is a lot more expensive than it is on the Benettons.

Thus the stories should be treated with some care as they may be an attempt to destabilize other deals being discussed...

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