Entertainment & Arts

As Monaco Grand Prix Revs Up, Formula One CEO Stefano Domenicali Talks U.S. Expansion And TV Future

Formula 1 is back on familiar turf this weekend at the Monaco Grand Prix, a glamour-wrapped race that has been a fixture since 1929.

While many of the track contours and Côte d’Azur vistas are little changed, the auto racing circuit itself has a decidedly revamped look. Earlier this month, it made a splashy debut in Miami, the latest stop in its U.S. expansion, which will take it to Las Vegas next year. That bow followed the arrival of the latest season of Netflix docu hit Drive to Survive, with the show adding pop-culture luster to negotiations for a potentially lucrative new U.S. media deal.

“The American market is ready for F1,” Formula One Group CEO Stefano Domenicali told Deadline in an interview ahead of today’s race. “Being ready means that we need to keep working on the fact that we need to stay connected with our fans in the U.S. We need to speak the same language, we need to give context.”

The Miami event provided the latest template, as celebrity attendees like Tom Brady, Matt Damon, Serena Williams and Bad Bunny mingled with corporate dealmakers, brand sponsors and a cross-section of others around the city over the weekend. On Sunday’s race day, 2.6 million viewers tuned in on ABC, making Miami the most-viewed F1 race ever in the U.S.

The Italian-born Domenicali succeeded former longtime Rupert Murdoch lieutenant Chase Carey as CEO of Formula One in 2020. He had previously led sports car maker Lamborghini and served a lengthy exec stint at Ferrari. Formula One Group is part of the portfolio of billionaire media investor John Malone’s Liberty Media. It is the parent of the Formula 1 circuit, which is a wholly owned subsidiary, and has minority interests in various other holdings.

Formula 1 dates to 1950 and its current world championship season runs from March to November, spanning 23 races in 21 countries on five continents. Goosed by the Miami tune-in, TV ratings thus far this year have jumped 49% over 2021 levels.

Domenicali said Miami had “the right energy,” cross-pollinating traditional sports with fashion, music, technology and other spheres, as F1 sets out to do. “This world is moving to us if what they see is interesting,” he said of the event’s boldfaced names. “Otherwise, they do other stuff.” The exec added that it was “very, very significant that business leaders were there,” noting that the Miami race followed the successful reboot several years ago of the Austin Grand Prix as part of the F1 world championship. It pulled in 400,000 attendees last fall in Texas.

Media watchers wonder what all of this momentum could mean in terms of ongoing rights talks. F1’s current U.S. deal, extended by ESPN in 2019, is due to expire at the end of the year. Recent reports have suggested that the circuit could ask for as much as $75 million a year, but many variables remain, among them the nature of the bidding and the length of the term.

Domenicali preferred not to talk numbers or specific suitors, emphasizing that a number of possibilities are still in play. He acknowledged speculation that Netflix, despite its past vows not to pursue live sports, might be induced given the popularity of Drive to Survive, which it just reupped for two more seasons. Fellow tech titans Apple and Amazon can’t be discounted as possible streaming-only homes given their aggressive moves with the NFL and Major League Baseball. New streaming players like Peacock and HBO Max have also added to the list of those looking to carve out pieces of the sports market, especially via a property with the additional lifestyle dimension of F1.

“We are exploring all of the opportunities,” Domenicali said. “We are not in a rush to make the decision.” He also went out of his way to praise the production work and commitment of ESPN at an important earlier stage of F1’s development.

On Liberty’s earnings call last February, execs were asked by one Wall Street analyst if they covet wide exposure even if the dollar value of a rights deal isn’t sky-high, as opposed to a path like that of the UFC, which is seen via subscription service ESPN+ (whose audience is a fraction of ESPN’s) but at a hefty premium. Liberty CEO Greg Maffei said the company opted to take “broader coverage over the money” in the most recent deal, “and I think that’s paid off.” In the current evaluation, he added, “We will weigh what’s available to us. And I don’t think as you know it’s a complete trade-off. There will be degrees of access degrees of coverage and there’ll be degrees of money.”

Demographics, not just ratings momentum, appear to be another element in F1’s favor as advertisers increasingly seek out ways to reach well-defined targets.

“If you compare the demographics of F1 and NASCAR, our population is much younger” and more female, Domenicali said. From 2017 to 2021, the company said its female fan base increased 8% in the U.S., reaching 40% of the total, while the number of fans aged 16 to 24 climbed 6% to 22% of the overall mix.

It is worth remembering as well that the U.S. market is just a sliver of the total, with F1 last year drawing 500 million fans and 5 billion TV viewers around the world. The average age of those fans, on a global basis, fell from 39 years old to 37 years old from 2017 to 2021.

The global footprint of Netflix has been a good match for F1’s far-flung network of supporters. Drive to Survive uses an unusual degree of in-season access to drivers, crews, owners, sponsors and other stakeholders to craft an episodic drama out of the previous season, whetting appetites for the upcoming one.

Netflix co-CEO Ted Sarandos talked up the series on the company’s most recent earnings interview and declined to rule out a rights bid, though he said it hasn’t been a primary focus, especially given the company’s focus on on-demand and not live programming. “I’m not saying that we’ll never do sports,” he said, “but we’ll have to see a path to growing a big revenue stream and a great profit stream with it.”

The streaming giant “has been very important for our growth,” Domenicali said. “On the other hand, we were very important for them, too. … As always, in a marriage you need to be two to be happy, otherwise there is a problem.”

Share this news on your Fb,Twitter and Whatsapp

File source

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button