BBC to end Formula 1 television contract early
- Thread starter philip2009
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But a great many people's standard of living is rising and disposable income is also rising too. Sure, Mercedes and Rolex and Ferrari won't be seeing any huge gains as yet but red bull, Vodafone, Petronas and Marlboro are cheap and plentiful.
Subscription TV is a very different model to commercial TV, which means direct comparisons arent that straightforward.
FOM gets paid an amount of money from a broadcaster, and the broadcaster then has to make that money back. For commercial TV this will be through advertising during the show so they are dependant on having enough viewers watch the show in order to charge enough for the advertising. This is quite difficult when broadcasters like C4 aren't advertising during the race.
Sky on the other hand get a sizeable chunk of the funding for their programming from the subscription of viewers. They also sell advertising but they are less dependant on this. In another thread I think we worked out there were about 5m Sky Sports subscriptions in the UK. Sky don't really care if you actually watch or not.
So in terms of viewers free to air gets about 20m annual viewers, whereas Sky is more like 4m. However in terms of whos 'funding' the broadcaster, free to air is 20m vierers while Sky is actually 100m subscribers (20 races x 5m subscriptions) if measured on the same basis. When you look at it like that you can understand why the Sky deal is rumoured to be about £1bn over the 6 years (£166m a year, whereas Channel 4 currently pay 'just' £24m a year).
There was a blog a guy did a couple of days back that showed that in theory (there was a lot of speculation, but based on solid foundations) the Sky deal (which is only a change relating to just 5% of the TV audience remember) would be worth between £2m and £10m to each team in terms of prize money. That more than makes up for any potential reduction in sponsor income.
This deal, while crap for us fans, actually works out to be a net benefit to the teams.
FOM gets paid an amount of money from a broadcaster, and the broadcaster then has to make that money back. For commercial TV this will be through advertising during the show so they are dependant on having enough viewers watch the show in order to charge enough for the advertising. This is quite difficult when broadcasters like C4 aren't advertising during the race.
Sky on the other hand get a sizeable chunk of the funding for their programming from the subscription of viewers. They also sell advertising but they are less dependant on this. In another thread I think we worked out there were about 5m Sky Sports subscriptions in the UK. Sky don't really care if you actually watch or not.
So in terms of viewers free to air gets about 20m annual viewers, whereas Sky is more like 4m. However in terms of whos 'funding' the broadcaster, free to air is 20m vierers while Sky is actually 100m subscribers (20 races x 5m subscriptions) if measured on the same basis. When you look at it like that you can understand why the Sky deal is rumoured to be about £1bn over the 6 years (£166m a year, whereas Channel 4 currently pay 'just' £24m a year).
There was a blog a guy did a couple of days back that showed that in theory (there was a lot of speculation, but based on solid foundations) the Sky deal (which is only a change relating to just 5% of the TV audience remember) would be worth between £2m and £10m to each team in terms of prize money. That more than makes up for any potential reduction in sponsor income.
This deal, while crap for us fans, actually works out to be a net benefit to the teams.
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Soldato
Well if they go 4k, I can see myself paying, it'll just be all the casual fans who won't watch as much.
I'm not sure sky will be able to justify the money in 2025 though.
Do sky make a big profit at the moment?
I'm not sure sky will be able to justify the money in 2025 though.
Do sky make a big profit at the moment?
They made £1.4bn profit last year.
Http://corporate.sky.com it's all there.
Compare that to BT who routinely make £2bn+ and you can see they both want a piece of each other's pie. And considering Openreach put in a third of that profit you can see why BT wanted to keep them part of the group.
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Soldato
Interesting, thanks
3.2 million viewers tuned in to watch the first live on Channel 4, the majority of them will no longer be able to watch the sport they love in the future.
Sky are deluded if they think they've going to pay £30+ monthly to watch a few races, they need to rethink the Sky Sports package or they've effectively killed F1 in the UK.
Sky are deluded if they think they've going to pay £30+ monthly to watch a few races, they need to rethink the Sky Sports package or they've effectively killed F1 in the UK.
Casual fans you say? I loved F1 up until the last few years but how can anybody get so excited when you know one of the two Mercedes is going to take pole and the race every weekend or second weekend. Must have been a good time for secure betting.
I mean to a certain degree yesterdays race was a bit more interesting in recent times, since bits of cars/dodging punctures happening everywhere rather than just follow the leader until the end. Or endlessly conserving fuel/tyres and dialling the engine back.
God forbid any fans truthfully criticises the sport and Crofty/Sky and Co, F1 engineers/CEO's/Management become super super defensive. "It's all about the fans" Remember all that crap from Christian Horner and co? Maybe that is why Europe is getting the heave... Screw you, you ungrateful European fanbase for telling the truth. Even Martin Brundle criticises it.
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I don't think it's the best idea.
In fact I'd say BT did well to get sky to put forward a large chunk of cash towards it
I expect having vs not having f1 doesn't work out too well.
I doubt many would drop sky sports of f1 wasn't there. I also doubt many people get sky sports just for f1
BT may well have hoped sky would out bid them.
I feel a lot of people who watch f1 only watch f1 and no other sports and thus can't stomach the sky price JUST for f1. This compounded with f1 being predictable (in terms of who wins the WCC and WDC
Soldato
Given the widespread popularity of the mainstream sports (football, both versions of rugby, cricket) that are also on pay TV, this seems very unlikely as it would be an incredibly narrow audience.
I just don't feel f1 makes a difference to skys subscription count.
I don't know anyone myself who would pay for f1 when it goes unless they already have sky.
At the PL's insistence it was a 'blind' auction so Sky had to bid without knowing what BT Sport (and anyone else) had bid. Sky is in a unique and rather difficult situation. Sky's customers expect the lions share of the PL football to be on Sky so Sky therefore have to bid in such a way that this continues to be the case. The price only sky-rocketed over £5 BILLION
eek over three seasons because of the relatively cash rich BT Sport entering the bidding process and the EU mandating that no one company can have all the rights.By the time the next auction for rights comes out (2019 I think) BT's cash reserves could be even bigger so we could be seeing £6 or £7 BILLION being offered. unless Sky, BT, the FA and anyone else interested in bidding sticks two fingers up at the PL and says 'no, we're not going to continue to take part in your charade of an auction as it's not fair, the amount of money is quite frankly obscene (how many Ferrari's can one player drive at any one time?) and needs to stop. And this is from someone who works for Sky.
But because Sky can't trust anyone to stick to their word (and potentially Sky can't be trusted either) it won't happen because there will always be the thought that if everyone 'agrees' not to bid, someone will behind the backs of everyone else.
I do agree though, the blind auction needs to stop.
Man of Honour
Well said. The money in football is just insane.
Soldato
Can't help wondering how they can afford it.
Soldato
Maybe most f1 viewers are (were) casual and will watch snooker instead.
F1 is just not as popular to people who are prepared to pay as it thinks it is.
Football gives a lot more competitive content.
I know world wide audience blah blah, but how many of those pay £30 a month.
Sky seem to me to be desperate for content.
Crikey I'm even starting to like football, so f1 viewers get sky , start to like football and move over to BT .... Then don't watch f1.