As most of you know, I have strong opinions on this, so of course I'll throw in my two cents. A long-winded two cents.
The first thing I'd say is that it's easy to get melodramatic about the issue. But in truth, F1 doesn't really need to be 'saved' as it's unlikely that it's just going to up and go bankrupt any time soon. Teams and fans have been on about F1's finances for years, but the sport keeps going, making adjustments along the way. Smaller adjustments than most would like, but it's managed to keep going nonetheless. Not that there aren't plenty of things to talk about.
It helps to break the sport down, since some areas are doing just fine while others seem to be in need of some first aid. And some sources of income for the sport are in conflict with others, so it would help the conversation to spell them out and define exactly what's meant by 'saving' the sport...
The FIA
I think the FIA is doing O.K. financially with the sport. They don't really have much of an outlay as far as the sport goes, and one thing Todt has done over his reign is to increase their income in various ways. He's increased the fees that the teams pay by a considerable amount, and has done the same for the drivers as well. And I suspect that he has gotten some financial concessions from FOM/CVC as well. Todt said that he was going to try to renegotiate their deal with FOM and my guess is that he was able to do that through the new Concorde Agreement. At least Todt seemed pretty happy about it at the end. But since it's not a public document, we may never know for sure.
Apart from crying over the money they threw away by not bidding out the commercial rights, the FIA's biggest concern is participation. This is directly related to the financial health of the teams, which is multifaceted, so let's leave it at that for the moment.
Issues: Participation
FOM/CVC
These guys are sitting pretty financially, for the most part. I'm sure that CVC didn't like having to renegotiate with FOTA and start giving away half their income, but they're still making money and have been able to sell off portions of their ownership (for a profit, we assume). And the revenues they generate have doubled over the past ten years as well, so that's something.
The question for them is really the long term health. Most of their income, about 2/3 of it, is generated through hosting and broadcast fees. These have been pretty high in the past and have typically had yearly increases built into them, which is why they've seen those steady increases in income. But we have to wonder what will happen when the larger of those contracts come up for renewal. Maybe tracks like Malaysia will continue to pay between $60 and $70 million, but we won't know until it happens. So there's definitely some medium to long term risk to that income.
Viewership and attendance are two other points of concern. I believe the viewership high was 600 million in 2009 and has dropped since then to an estimated 500 million. Of course, those numbers go up and down in different markets for different reasons but I think most fans will agree that the races just aren't as interesting as they were.
Attendance, I think we can agree, is abysmal for such a popular sport, particularly for some of the pacific races. Part of this is related to holding races in countries that don't have a solid fan base, but I think even that is tied to two problems - 1) ticket prices, and 2) inadequate local promotion. It's a problem for FOM in that for most of their races, attendance is directly related to how much of a fee they can charge - not all of them, obviously, but for the European and American legs of the season, certainly.
So, for FOM, I think the drop in viewership and attendance need to be addressed. I don't think they can do much about the fees they get from venues who don't care so much about attendance - those are related more to the economy and Bernie's negotiating skills.
They also are concerned about the number of teams since that affects viewership.
Issues: Attendance and Viewership
The Venues
We don't talk much about them, but they have budgets, too. The Abu Dhabi's of the world aren't of concern here, but certainly the Silverstone's and Spa's are worth considering. They've got some issues with noise complaints and such, but obviously the big issue here are the race fees. Of course they're in competition with the middle east and pacific races, so the math for them is fairly simple - so long as FOM is able to get high fees from those races, the fees for everyone else will be high, too. So their fortune is dependent on attendance and occasional government handouts.
Issues: Attendance and high fees
The Teams
We have entire threads on various aspects of their plight, so I'll just link to a few of those for anyone who wants to read up...
http://www.f1technical.net/forum/viewto ... =1&t=16595
http://www.f1technical.net/forum/viewto ... f=1&t=7695
http://www.f1technical.net/forum/viewto ... =1&t=14176
http://www.f1technical.net/forum/viewto ... =1&t=17208
I would only add that individual teams have come and gone regularly in the sport, and we've seen periods where there were teams that didn't make it two race weekends. But even with that perspective, it's clear that there are issues for the teams today that need to be dealt with.
Issues: Income, cost, viewership
O.K., so we've got issues of participation, viewership, attendance, high venue fees, team income and team expenses. Participation I think is a function of team income and expense, so I don't think that needs to be addressed separately; but for the others, easy ones first...
Attendance/Venue Fees
This is primarily an issue of ticket prices, but also basic public awareness and popularity of the sport. Lowering prices, though, means lowering the race fees, which of course is in conflict with FOM's goals. My opinion though is that FOM and the sport in general would be better off in the long run by concentrating on and capitalizing on the sports popularity rather than it's image. That is, only a third of F1's income comes through race fees, which as I've suggested may see a decrease anyway simply due to the overall economy. I suspect that they could make that lost income up over time by concentrating on attendance and viewership, which in turn would potentially increase the fees they get from broadcast fees, trackside advertising, merchandising, trackside hospitality, etc. In short, I know they have a cash cow in race fees at the moment, but I don't see any potential for growth there, and some potential for decline, so it's better then that they concentrate their efforts elsewhere. That leads us to...
Viewership
Viewership is just a proxy for the sport's popularity. This, I think, is the most difficult issue to deal with, mainly because different people watch the sport for different reasons, and also because it's a vast, multifaceted area to get into. But the big thing I think most of us can agree on is the simple observation that sport lacks excitement and that the racing just isn't that good. For me, the problem is threefold - 1) money = performance, 2) the basic aerodynamics of the cars prohibit close racing; and 3) the solutions in place to deal with 1 & 2 are obviously contrived and mostly ineffective.
For me, these three problems have a single potential solution, which is to significantly alter the downforce of the cars. While I realize that money which isn't spent on aerodynamics will go towards other areas of the cars, I also believe that money would be slightly less effective spent elsewhere. Slightly, of course, isn't enough, so I have an additional suggestion that I'll discuss below, but I do think it's the right direction. More importantly, I think reduced aero would make closer racing possible, therefore more passing and more exciting racing. (More accurately, I think I would say 'restructured' aero, since I think F1 should still have downforce, but I think it should be designed specifically to address the issue of close racing.) If we could achieve that, I think we could rid ourselves of the gimmicks currently in place and bring the racing itself back to a more pure state.
To be even more specific about it - some of you know that I'm a big fan of the Sigma concept car from many years back. What I like about it from an aero aspect is that the downforce is limited to a single, centrally placed wing. That arrangement would punch a hole in the air, allowing drafting, while hopefully not (significantly) reducing the downforce of the following car, since that wing would be further back and at the same height. I'd like to see that confirmed, but instinctively at least I think it would work. Anyway, worth taking a look at - if nothing more, the car is far better looking than anything on the grid today:
http://www.ridelust.com/1969-pininfarina-sigma-concept/
O.K., apart from that, I also think FOM could do a better job of promoting the sport in the Americas. My suggestion for that is, much like with the venues, for them to accept a smaller broadcast fee in order to get the entire season onto network tv as opposed to cable. Smaller fee initially, but greatly increased exposure that grows the sport.
And finally, I think Bernie's skills aren't the skill the sport needs now to grow. Bernie is the master of the negotiation, but what the sport needs now is promotion. I think it's time that CVC hired a true promotions agency to promote the sport and grow the audience.
Team Income
This issue is twofold: income from sponsors/partners and income from the sport itself. I think the sponsor issue would be largely dealt with through better promotion, popularity, etc. as discussed above, but there are some things I think the sport could do to help the teams with their sponsorships. Firstly, I think the teams should be allowed to run different sponsors on each of their cars, and I think they should be allowed to change their sponsorships as needed. NASCAR does a lot of race to race sponsorship deals and the teams have multiple title sponsors, and it seems to work well for them. Getting back to the Sigma car, I think that body style, with a broad 'hood' would make for a better billboard for sponsors, again much like in NASCAR. And I think the aero changes I mentioned would help to tighten the races, so that sponsors have more of a chance for their logos to be seen. I'm sure there are many other suggestions to help in this respect, which of course is why I started the thread on team income.
Income from the sport is mostly related to prize money and other payouts from FOM to the teams. Others have rightfully pointed out that the current distribution system is grossly inequitable and I agree that it should be changed. The question of how much of that income should be given to the teams, though, is interesting. As I pointed out in the income thread, the Premiere League, which is fully team owned, also gives 50% of it's income back to the teams, so in that respect, the figure seems right. I think it comes down to the question of what the rest of the money is being used for. Obviously if that money is going towards promoting the sport, then there's no problem. If it's lining pockets, well then maybe there's room to renegotiate.
Team Cost
This is another issue that's been talked about forever, and I think we're all familiar with the pros and cons of different solutions. My opinion is that the only workable solution is to allow customer teams. I think the idea would work on multiple fronts - lower cost for the smaller teams, make those teams more competitive, give them more exposure and a better shot at getting sponsors, and make for tighter grids and better racing. I also think that a 'customer' championship could be added, increasing the smaller teams' chances for prize money.
And that, as they say, is that.
I'm sure i've left some stuff out, made some mistakes, and likely written a few confusing paragraphs in an effort to get what's in my head through the keyboard. Probably more than a few edits to follow...
