Formula 1 is in a healthy position from a media rights point of view but is looking at partnerships that extend beyond simply broadcasting races, according to Liberty Media CEO Derek Chang.
The television rights in the United States are up for renewal at the end of this year, and sources indicate Apple is in a strong position to take over from previous broadcaster ESPN. Chang was speaking at the Goldman Sachs Communcacopia & Technology Conference earlier this week and says the direction the U.S. might take is also something that is being looked at globally, as F1 attempts to engage its fan base away from race coverage.
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“We are a healthy property, and I think a sought-after property as we have these discussions around the world,” Chang said. “We announced that we’re doing something with Globo, being back on Globo in Brazil next year. We announced earlier this year that we had renewed our rights in Canada. I think we’ve got discussions ongoing in several of the major markets that we will have clarity to here relatively soon.
“Much like the U.S., I think this is a holistic sort of view of traditionally what’s been known as your media partner, but I don’t know if it’s necessarily a media partner per se in a classic sense of someone who’s just broadcasting your race. It is someone who can help fans access your content beyond the race.
“It is someone who can help your fans interact with even your sponsors. It’s all of that. I think the guys that are looking forward and sort of view that as part of their own playbook and what we can do to enhance that for them are ones that we want to try to do business with.
“It’s not a perfect world and timing is never perfect either. You have to sometimes deal with the practical implications of what’s available and how to make that partner and what’s available work for you. These discussions globally seem like they are very healthy. I think Stefano [Domenicali, F1 CEO] and his team are doing a great job. I think we’ll continue to see the right partners line up with Formula 1.”
Chang says the sport’s media rights situation is not the only area that F1 is in a strong position, praising the work done on the sponsorship side, too.
“There’s always an investor narrative that there’s a finite period at which something’s going to end, right? Understandably, as people do their risk assessments and all that sort of stuff,” he said. “I think that on the sponsor side, this has been an incredible year. Stefano and Emily [Prazer, F1 chief commercial officer] and their teams have done a fantastic job on multiple fronts.
“One is the continuation of just bringing in new sponsors. Vegas has been a big part of that, and I think it’s been very helpful to that story and to that narrative. I think as we are filling a lot of categories, there are still several that can be filled. I think there’s growth opportunity in terms of existing renewals that are going to happen here over the next several years.
“I think you can see the demand is there – the inventory is kind of tightened in some ways. What you will hopefully see is, even if the names don’t change, it is actually a good thing because having long-term partners who continually have associated with you and continue to invest in that brand association is extraordinarily powerful.
“I think what you’ll see is hopefully people coming in at different tiers where you drive demand and drive pricing, and that in itself will help the monetization, beyond the continued investment in that brand affiliation that these guys make.”
