Escalating event costs
Interesting to see, today, that Turkey is looking seriously at whether it can afford an F1 Grand Prix next year. It seems as if the asking price is going up from £13m to £26m for 2012. I know that F1 wants to get as much out of any arrangement as it can, but I do think that some sort of realism is required when pricing an event. The venue must feel that there is something to gain from hosting a Grand Prix otherwise it is not a viable business deal. I think the Australians have been considering the situation pretty seriously for some time.
Nothing, however, has changed – it is probably just that the sums involved appear larger. Some years ago I organised a number of high-profile yachting events and there was always the trade-off between cost and revenue to consider. Even then, some classes or organisations were pricing themselves out of existence for “normal” venues – the large sums were only available from Asian venues, with bottomless oil pockets, wishing to position themselves on the map or the higher profile and wealthier, and tax efficient, European venues such as Monaco.
For the organiser who is working on behalf of the venue/area/region, there are three types of events – one which brings profile to the area but which costs money to acquire and put on, one which has little or no profile but provides a reasonable income to the venue and, thirdly, the holy grail event which brings both profile and a good income to the venue or the area/region in which the venue is situated. Obviously the organiser would like to get as many of the type three events as possible but, equally obviously, a synergistic blend of all three can work well both for the profile of, and for the revenue to the venue/area/region and is a more realistic target.
I hope, for the sake of all sport and, F1 in particular, that a sense of proportion can be achieved and, what I consider to be unrealistic greed, does not spoil the sports that we all enjoy. We live in globally strange times financially and what was once the norm can no longer be considered to be so and this must surely be taken into consideration by those promoting sporting events at all levels.