BBC says F1 coverage cuts will save ??150m

Television

Eddie Jordan, Jake Humphrey, Mike Gascoyne, Barcelona, 2011

Jake Humphrey presents the BBC's F1 coverage

BBC director general Mark Thompson says the corporation will save ??150m by dropping half of its live F1 races.

Speaking before the Culture, Media and Sport committee Thompson said the BBC had approached Sky about the deal and did not enter into negotiations with any other free-to-air broadcasters.

He said: “The idea of sharing the rights under the remainder of the current contract and of potentially extending that contract was our idea. There was a negotiation that led to all the parties involved in the conversation being happy with the idea.

“The effect will be to save the BBC well over ??150 million between now and the end of the contract-money that obviously means that only half of Grand Prix will be live on the BBC, but it has enabled us to keep a very good position in Formula 1, and to make savings that otherwise might have meant deeper cuts in other services.

“As for the considerations for us, we know that Formula 1 has only fairly recently come back to the BBC; it has been very popular on the BBC. Secondly, we know that Formula 1 fans ideally do not want Formula 1 to be interrupted by advertising, because of the character of the sport.

“Nor, of course-for the subset of Formula 1 fans who do not have Sky subscriptions-would they, ideally, like Formula 1 to go entirely behind a paywall. I believe that the arrangements that we have reached offer very good value to the licence payer, and the experience of Formula 1 on the BBC will still be very rich.”

Asked if the BBC had approached free-to-air broadcasters Thompson said: “No, and to be honest I think that I would have already been on the edge of the limits of what it is appropriate to do, in terms of the appropriate separations of sports buyers in the market under the Enterprise Act.”

He continued: “We were quite clear that, to get the economics to work for us, it was going to have to be a pay partner, and this was the only pay partner, credibly, whom we thought we could involve in it-indeed, a pay partner who had expressed interest in this very topic of conversation previously. It was an example of a free-to-air pay partnership, which is not by any means unknown in the market.”

The government imposed a six-year freeze in the BBC’s licence fee in October last year, forcing it to make significant cuts in spending.

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110 comments on BBC says F1 coverage cuts will save ??150m

  1. Prisoner Monkeys (@prisoner-monkeys) said on 21st December 2011, 22:32

    The BBC is, first and foremost, a business, and so it must be run as one. As a business, its first, last and only purpose is simple: to make money. Halving their Formula 1 coverage might be an unpopular move, but at the same time, £150 million is a lot of money. It’s more than the operating budget of most Formula 1 teams; in 2010-11, the BBC were spending more on Formula 1 than they were on BBC Three and BBC Four. The BBC evidently feel that saving that £150 million is more important than retaining their market share with Formula 1. You might think that is insane, but from a completely objective point of view, it does make a lot of sense. Like I said, £150 million is a lot of money, and with Europe staring down the barrel of financial chaos, organisations like the BBC have to be very careful how they spend their money.

    • John H (@john-h) said on 21st December 2011, 23:05

      If the only purpose of the BBC was to make money then why doesn’t it have pay per view services itself? The BBC is funded by a compulsory licence fee which even people that only watch sky have to pay. This is not free market capitalism at work.

      No one is arguing that the BBC doesn’t need to save money, they are angry as licence fee payers that negotiations were solely with Sky.

      • Prisoner Monkeys (@prisoner-monkeys) said on 21st December 2011, 23:25

        It’s llikely the BBC negotiated solely with Sky because of the wording of their contract with FOM. If they had handed the rights to the sport over to another commercial station, they would have given up all of their Formula 1 coverage – and they would have taken a massive financial penalty for offloading the rights before the contract expired. It’s unlikely a joint broadcasting deal could have been worked out, because then the BBC and their partner would have gotten into a row over who got to broadcast which races. But their contract with FOM and the Concorde Agreement allowed for a deal with Sky.

    • Ilanin (@ilanin) said on 22nd December 2011, 2:32

      The BBC is first and foremost a business

      Stop right there. The BBC is not a business. The BBC is a public service broadcaster. Nowhere in the BBC’s Royal Charter is there any requirement for it to make a profit. The actual public purposes of the BBC are (quoting verbatim from its charter):

      The Public Purposes of the BBC are as follows—
      (a) sustaining citizenship and civil society;
      (b) promoting education and learning;
      (c) stimulating creativity and cultural excellence;
      (d) representing the UK, its nations, regions and communities;
      (e) bringing the UK to the world and the world to the UK;
      (f) in promoting its other purposes, helping to deliver to the public the benefit of emerging communications technologies and services and, in addition, taking a leading role in the switchover to digital television.

      The promotion of Formula One, which David Cameron (quite reasonably) called “an incredible British success story” fulfills points (d) and (e) very well, and given the technical nature of the sport it also provides avenues for (b) and (c).

      • Prisoner Monkeys (@prisoner-monkeys) said on 22nd December 2011, 3:00

        @ilanin

        Stop right there. The BBC is not a business. The BBC is a public service broadcaster.

        The BBC has income and expenses. It has assets and liabilities. It is a business.

        Nowhere in the BBC’s Royal Charter is there any requirement for it to make a profit.

        Nevertheless, I’m quite sure the government prefers it to behave like a business so that they don’t need to bail the BBC out every year. If they did, the inevitable question would be “Why don’t you start cutting some of your costs?”, which would be qickly followed by “Because if we keep have to bailing you out, we’re going to make those cuts for you”.

        While the BBC might not be a business by the letter of the law, it is a business in spirit, simply because it can meet its purpose more effectively if it as run as a business. Trying to say “The BBC is not a business, so any argument that the BBC dropped Formula 1 on business ground is a poor one” will not get you very far.

        Formula One, which David Cameron (quite reasonably) called “an incredible British success story”

        Except that it’s not British. Well, not just British. The current World Champions are a German driver and an Austrian team. There is just one race on the calendar that is held in England. There are more French and German competitiors than there are British. Formula One might have started in Britain, but other countries have more claim to its current success.

  2. F1 Omer said on 21st December 2011, 22:58

    UK viewers, if you spend about £50 on a Standard Definition satellite receiver and also have a dish to point at the Astra satellite at 19.2 degrees East you can receive free broacasts from the german station RTL which has a contact to broadcast F1 free to air until 2015. Commentary is in german and there are adverts but the pictures are more important than the commentary and if we are lucky BBC 5 Live may provide a radio commentary. So there is no neccessity to pay greedy SKY any money at all.

  3. F1 Omer said on 21st December 2011, 22:58

    oops for contact read contract.

  4. Prisoner Monkeys (@prisoner-monkeys) said on 21st December 2011, 23:00

    I think the BMW Sauber collaboration was working. They were, after all, third in the WCC. But the problem was that the F1.09 was a terrible car, and it was very expensive to turn it around. This itself wasn’t that much of a problem; the real issue was the global recession. BMW were hurt by it, and they simply couldn’t justify keeping BMW Sauber alive. If it weren’t for the recession, we’d probably still have BMW Sauber on the grid.

  5. UKFan (@) said on 21st December 2011, 23:13

    How can someone save £150M this just means that F1 costs much more, how?! let me see sending an oversized crew doenst cost that much still they are going to send an oversized crew, where do they waste money? im puzzled. I know if BBC wants profit they should use this small amount of money to… I dont know…. build an F1 team let me see if covering half of the races means saving £150 not broadcasting at all gives them £300M perfect to start your own winning racing team.

    To be honest they might as well be washing money I dont care not anymore neither you should.

  6. Rugel (@rugel) said on 22nd December 2011, 0:41

    I’m from Canada and was wondering what happens to the rest of the world since BBC is not showing all the races. Anyone with a clue?

    • lordhesketh (@lordhesketh) said on 22nd December 2011, 1:15

      I’d posted a similar query earlier. I haven’t heard anything regarding TSN or SPEED’s coverage for next year. I’ve e-mailed them both and not received a response.

      • Prisoner Monkeys (@prisoner-monkeys) said on 22nd December 2011, 1:20

        I know that some broadcasters – like OneHD/Ten here in Australia – will broadcast direct from Sky’s feed. What these stations actually show is the world feed. The BBC will not control the world feed in 2012 because they are not the exclusive broadcaster. They’re a terrestrial broadcaster, like TSN, SPEED and OneHD, and they cannot control the world feed.

      • BasCB (@bascb) said on 22nd December 2011, 9:49

        I guess Speed, being Murdoch owned, will easily get the feed from sister company Sky (don’t they get the FOM feed directly though?). Not sure about others, but I guess most would be looking at doing a deal with News Corp for that coverage now.

  7. maxthecat said on 22nd December 2011, 1:14

    The BBC get tons of money, about £3 billion a year and show nothing but repeats so what an earth they spend our money on is mind boggling, in fact i recently read they spend £250 million a year chasing non licensed households for money they probably won’t ever get.

    Saying they sold out F1 fans to save money is a stupid argument and one that any half witted person would see as such.

    • UKFan (@) said on 22nd December 2011, 1:51

      Finally I read a good comment here I myself cant understand where they spend all their money what I know is that no Public company is efficient from an economical stand point, BBC are just washing their underwear with F1.

    • What an Inane statement. Hate to break it to you, but the F1 coverage is a drop in the water for the BBC in terms of ratings. and more than two thirds of their programming is original – whilst the amount of repeats is creeping up, it certainly isn’t the majority of their content.

      BBC average F1 viewing figure: 4.9 million people per race,
      BBC average Eastenders viewing figure: approx 10 million per episode.

      Expecting the BBC to prioritise F1 over their headline content is downright asinine.

  8. manatcna (@manatcna) said on 22nd December 2011, 2:00

    I heard it was £3.5 Billion and when you’re talking about that kind of money I would imagine there would be quite a few leaks.

    Whether you think of the bbc as a broadcaster or a money making machine makes no difference, they will do as they like and still pay the top people too much.

    Give me £3.5 thousand million and I’ll give you the best television in the world – as the bbc once was but will never be again.

    RIP bbc

  9. OOliver said on 22nd December 2011, 7:00

    Public private partnership means a toll gate on every street.
    Economically, there may be nothing wrong with the deal, but in principle, there is everything wrong with this deal.
    It is not for the BBC to choose what will benefit the viewers.

    Ok the BBC will show 10 live races next year, what about 2013 and onwards? Don’t be surprised when they reduce their live offering to save even more money, while describing it as the best deal for the viewers.
    The best he could have done if its to expensive, is drop it. But to decide who gets it is what have problems with.
    Believe it or not, the BBC is pay tv and their income not affected by a drop in viewership.

  10. AndrewTanner (@andrewtanner) said on 22nd December 2011, 7:47

    The offending TV License came in the post the other day.

    I’m still holding out for a good deal between Virgin Media and Sky.

  11. Tiago Carvalho (@tiagocomodoro) said on 22nd December 2011, 8:09

    Guys, I think you all in UK are very lucky to have BBC.
    I live in China, and here the broadcast is the worst possible, half of the races the TV just showed after midnight on Sunday, and in all the races there are many ads, and of course, the poor coverage is all in Chinese even as I have cable-TV
    So believe me, you guys are in a good position

    • Alianora La Canta (@alianora-la-canta) said on 23rd December 2011, 15:52

      I still don’t see how that excuses either the specific deal that Bernie approved of Sky getting half the UK-broadcast races to itself, or the general trend of taking F1 broadcasting to the lowest common denominator instead of encouraging everywhere to match the best.

  12. manatcna (@manatcna) said on 22nd December 2011, 8:55

    So, Sky is to show F1 races without adverts in 2012.

    Has anybody heard what their plans are for 2013 and beyond?

    • GT_Racer said on 22nd December 2011, 10:09

      They will show races without Ad’s for the length of there contract from what I’ve been told.

      I understand there may be 1 Ad break during practice (most likely early on when everyone is in the pits & additional breaks if there are any red flags) & at least 1 break during qualifying (In the break between Q1-2 or Q2-3).

      Sky know that Ad’s were massively unpopular when F1 was on ITV & when they looked at it they also saw that in the new format F1 (With more pit stops & more on-track action) there are no longer any natural breaks in the action (ITV often scheduled breaks to take place just before/after pit stops when there tended to be less going on).

      Looking at Ad breaks you would be surprised at just how much broadcasters miss while on an Ad-Break & much of t never gets mentioned or replayed when they come back. The bigger things like accidents & front running position changes often are but smaller things like passing a bit further back & spins or cars running wide (Which are often no less important) are often never even mentioned.

      ITV missed some key moments while on Ad-Breaks (Hill taking the lead at Hungary ’97, Schumacher crashing from the lead at montreal ’99 & retiring from the lead & having his title hopes ended at suzuka ’06, fisichella bringing out the safety car after big crash at eau rouge at spa ’05) & there was that incident at imola in 2005 when they cut to a break on the last lap in the middle of that thrilling fight for the win between schumacher & alonso.

  13. antonyob (@) said on 22nd December 2011, 10:43

    Gee! really? you’d rather not pay a penny and put up with advertising!! shock shock horror horror. Id rather have a free beer and listen to the landlord extol the virtues of Fosters lager for 90 seconds as well but in the real world theres a recession on so deal with your “hardship”!

    The real problem with the Beeb deal was they completely over did it. Probabably we dont want to go back to the days of 1983 when there was at most 3 minutes pre amble with it cutting back to horseracing as the winning car crossed the line but did we really need a separate team for practice? And why were they covering practice anyway?

    We dont, sorry i dont, want a pre show with EJ buying a shirt downtown and Jake giving us a robert robinson holiday program about whatever location they are in. I was always very happy when James Hunt used to cycle to the BBC in town and talk over the live feed. why did we need to watch DC wear inapropriate jeans for a 40 yr old stand next to an even more inappropriately goateed pensioner, live and direct from the venue? It added nothing.

    Its not a lifestyle show its motor racing. Im watching it for the cars not the stars. If i liked gok wang shows i wouldnt expect them to spend 4 minutes covering what had happened in formula ford that week so dont give me the opposite in F1.

    Its the same old story with motor racing, but for sites like this, there is no real understanding in the media of how to handle F1 so they get some oxbridge squit producing it who wouldnt know an f duct from his effin elbow and he/she tries to “broaden its appeal”. Id actually llike them to narrow its appeal.

    All of which means the bbc can save a ludicrous 150million when if they had not been so excitable in the first place they couldve covered the whole lot for half what they will spend next year.

    • And why were they covering practice anyway?

      because its an important part of the weekend which many fans want to watch.

      did we really need a separate team for practice?

      wasn’t costing the bbc any extra to have a seperate team as the radio broadcast is handled by an outside company & radio/tv broadcast’s differ so much that having 2 seperate teams is necisary.

      We dont, sorry i dont, want a pre show

      majority of fans would disagree.
      ok not all the pre-race stuff was great but i for one enjoyed a lot of it.

      if pre-race shows were not important then nobody would watch, the ratings would show this & the pre-race shows would be shortened or scrapped. ratings show that majority of fans watch the pre-race & the various message boards etc… im a member of indicate most of them enjoy them.

      going back to the old style coverage (from a london studio with no pre-show) isn’t going to happen because viewers expect more now.
      having a studio in london means you don’t have all the info from trackside. the american broadcaster (speed channel) broadcast’s from a charlotte studio & they are often behind when it comes to trackside information because there not there getting everything in real time.

      having no pre-show also means you never get to know the teams, drivers, tracks (more important to new viewers who are still learning about the sport) & the latest news & whats happened over the weekend.

      the bbc coverage with its practice coverage, pre-show & team on-site is an award winning broadcast, you never see broadcasters with less coverage winning the awards or getting praise from fans & there is a reason for that.

  14. UncleBob said on 22nd December 2011, 12:04

    Does anyone know how the qualifying will be televised???

  15. antonyob (@) said on 22nd December 2011, 14:14

    yes quite right Dizzy, though i didnt suggest there should be NO pre show. i just couldnt care less about the pompous mock poetry starts and EJ buying a shirt.

    Of course all your arguments, valid though they are miss one crucial point: The huge coverage and team required to run bbc f1 has meant we are now losing half the races unless we succomb to paying the dark side. I know what id rather compromise on and its not live free to air race action.

    • Although I think overall the BBC’s coverage is great the “pompous mock poetry” as you call it is one of the things that annoys me. I don’t know if this type of thing has a proper name I tend to class them the same as I do perfume adverts, pretentious twaddle, and sadly this is not just confined to BBC’s F1 team.

      The other thing that annoys me is when they do an interview, which is preplanned not the live ones, they use the same camera technique which has invaded a lot of modern TV. The shot does not stay still for more than a few seconds, the camera is constantly zooming in and out and they are always changing camera angles.

      A good example of this was during the show for the German GP with the Alonso interview. Alonso did a card trick, now when filming a card trick I think you should always keep a steady shot on the cards, but the camera moved about so much Alonso had time to completely change the deck of cards a few times.

      I don’t know why this style of camera work is so common now, it makes it look like the cameraman is totally inexperienced and is just pressing buttons at random

    • Alianora La Canta (@alianora-la-canta) said on 23rd December 2011, 16:36

      The huge coverage had nothing to do with the Sky deal; even with the large production effort the BBC put in, the Bernie fee was still 4 times the cost of the non-Bernie expenses put together and that differential was only going to rise as time went on. Saving a couple of million a year to give bare-bones coverage wouldn’t have paid for the BBC to carry one more race let alone two years. Also, the audience continued to rise throughout the BBC’s tenure despite British drivers being less successful at the end than the start. The extra coverage was enjoyed by dedicated and casual fan alike.

  16. I believe that the arrangements that we have reached offer very good value to the licence payer

    So half the live coverage but no reduction in the license fee, Mark Thompson really does have his head up his……

  17. just for those who fail to understand why the BBC ‘sold’ F1 to sky instead of allowing a deal with another channel
    the conservative government is supported by the news international newspapers , and is desperate to maintain that ; sky is , of course a NI subsidiary
    although the interests of the viewers is supposed to be protected by an independant panel the chairman of the panel is ….. a member of the conservative party and a former government minister !!!

    so we got screwed ; I wouldn’t have been pleased if the BBC had done a deal with an advert funded channel , but I could have understood that …the fact that F1 employs a large number of people in the UK and the UK is world leader should have dictated that the BBC gave the maximum support to F1 seems to have been ignored …plenty of money is given to support things like tennis and rubbish american programmes and the money could have been saved there

    this decision was POLITICAL

  18. Adrian J (@adrian-j) said on 23rd December 2011, 0:41

    I have to confess I’ve discovered a healthy way to potentially watch F1 live next year…

    …I am joining a gym for health reasons and they have Sky Sports available to watch while you’re on the running/cycling machines etc…

    …might well end up very fit after cycling for the full race distance!!

  19. antonyob (@) said on 23rd December 2011, 11:29

    yes what a complete nonsense! the bbc gives you 4 channels on the telly, iplayer, half a dozen radio stations for £10 a month and no ads and you want a partial refund cos some f1 races arent broadcast live. i think the only person with his head in the wrong place is you my friend.

    I actually feel quite angry when people make those comments about a service unmatched in the world.

  20. The Limit said on 23rd December 2011, 14:09

    It certainly appears as if this is the first step towards Sky attaining full coverage of F1 races. With people like Martin Brundle joining Sky’s F1 commentary team, the BBC’s version only has a slim chance of lasting for any real length of time.
    What angers me is the fact that the BBC pretend that this situation is the ‘best thing’ for the fans. That is complete rubbish and an insult! This is the best situation for Rupert Murdoch and Sky Tv and no one else. For all the stick ITV took when they had the F1 tv contract, atleast they saw it through for twelve years. Also, they had to endure the Schumacher ‘dominant’ years at Ferrari and low viewing figures. Only to be shown the door when F1 became more popular in the UK again following Hamilton’s arrival and Button’s championship.
    And now the BBC, after only three seasons, moreorless throw in the towel and in the most pathetic way possible. They might as well have Gary Lineker doing the highlights in a match of the day style format, it is embarrassing and a complete insult to suggest that that is what real fans want.

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