Honda website
Honda website

MARCH 7, 2002

Television, sport and the European Union

FORMULA 1 and the European Union spent years sorting out the problems which were perceived to exist within the structure of the sport. The result was a division between the sporting authority (the FIA) and the commercial authority (Formula One Management and its various parent companies). The new system means that the two sides of the business can run side by side without interference.

By now there are new questions on the horizon relating to how TV rights are organized. The European Union is currently in the process of reviewing its "Television without Frontiers" directive, which dates back to 1989 and later this year the European Commission will come up with new proposals as to what is allowed and what is not allowed in the TV industry in Europe.

Some of the issues under discussion are whether or not major sporting events should be protected from pay-per-view operators; how advertising will work with the increasing use of new technologies and who owns the rights to "virtual advertising"

The commission is currently undertaking three studies: examining the development of new advertising techniques; the various disputes over who has the right to advertise in a virtual way; and how much advertising should be allowed and which products should be allowed to be advertised.

Formula 1 has not embraced virtual advertising. There were some attempts to create changeable trackside signage but these were never a great success and F1 has not got into any of the really advanced virtual imaging which can flash up photographs and biographies of drivers on the road ahead of them or can put virtual adverts onto the grass in the infield of corners. There are, of course, many potential sources of revenue from these ideas, not least because advertising which is banned in one country can be used in another and the advertisers who are restricted in what they can do are usually willing to pay more for an opportunity.

One of the problems is that it is still not established in law as to who owns the rights to virtual advertising as it could be judged that virtual imaging belongs to the TV companies rather than the rights holder to the event.