As the Formula One teams and management work towards the signing of a new Concorde Agreement, the contract that will bind the teams to the series and dictate how the revenues are carved up, a senior industry figure has questioned the teams' ability to work together for a better deal.
Phil Lines, the sports media rights specialist who worked with the Formula One Teams Association (FOTA) in an advisory role last year while he was at American sports agency CAA, described the work as a “real eye-opener”.
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With the current Concorde Agreement expiring at the end of the year, the 12 Formula One teams are preparing for negotiations with Formula One Group, led by chief executive Bernie Ecclestone. The teams are seeking an increase in their share of the sport’s revenues, which reached around US$1 billion in 2010.
Speaking to SportsPro shortly after his departure from CAA in February, Lines offered this assessment of where the teams stand: “It’s difficult because when I went in to that I couldn’t really work out how Bernie [Ecclestone] had so much control and has retained such a high percentage of revenue. But after I’d done it for a couple of months I understood exactly how he was able to do it. There is just a lack of collegiate action from the teams. They don’t work together. It’s classic divide and rule.”
Lines, who was brought in by FOTA to assess all aspects of Formula One revenue streams with the aim of better preparing the teams in their Concorde negotiations, believes he was hampered by the teams' unwillingness to reveal their own financials and by the decision of Ferrari, Red Bull Racing and Sauber to withdraw from the organisation.
“It made it very difficult,” he said, “because having been recruited by the teams we then had teams that didn't want to talk to us.”
On Thursday, FOTA vice chairman and Lotus F1 team principal Eric Bouillier told Autosport that the organisation, despite the high-profile departures, still had a key role to play in the future of Formula One.
“I think the key thing is that even if some teams left officially the organisation, they are still committing on the main subjects – which are the Resource Restriction Agreement, and the testing agreements,” Bouillier said. “Teams are still actively working together, and FOTA also is now about thinking of changing the way we want to operate, and the way we see it perceived in the paddock.”
Lines, who made his name during an eight-year stint at the English Premier League in which he masterminded an explosive growth in international broadcast rights values, believes that a long-term Concorde Agreement will nevertheless be forthcoming.
“If they get a five-year Concorde Agreement, that’s a great time to sell it”
“There are very few real international sports which you can say are, if not a must-have property, then certainly a very strong property. Formula One is one of those,” he said. “I think there are questions about how to maximise various rights. I would think for CVC, if they get a five-year Concorde Agreement, that’s a great time to sell it.
“If I was CVC I would look at it and say, ‘OK, we’ve had a really good time here; Bernie’s not getting any younger; and we’ve just got ourselves a five-year MOT.’ I wouldn’t be at all surprised to see that happen. I think they want to get the Concorde Agreement as much as possible on the same terms as they’ve got now. And then they’ve got a very nice package to sell to someone.”
A comprehensive interview with Phil Lines, who joined Lagardere Unlimited as head of media activities for Europe and Africa last month, will appear in the May edition of SportsPro.