Reach for the Sky: Dissecting the Sky Sports/BBC Sport F1 Partnership

On Friday, the Formula 1 world was rocked by news that UK Television Broadcasts of the sport would be fundamentally changing starting from 2012. The state-supported and industry-leading BBC had originally been expected to hold exclusive rights to Formula 1 through the end of the 2012 season, after securing the rights from rivals ITV, who ditched them as a result of their almost perpetual cash-strapped nature.

More incredible was the new primary rights holder: technically, Sky Sports. This despite the fact it was generally accepted the rights had to be in the hands of a free-to-air broadcaster. How did FOM get around this? The rights actually went to a Sky Sports/BBC Sport Co-Operative deal. A deal which will give the BBC 10 races, or 50% of the season (Though in the event of 21 races, the extra race would be Sky exclusive). The two broadcasters will share commentary and some other resources, but use different presentation packages.

For the 10+ races the BBC is not showing live, they are showing…Well, what exactly? Bernie Ecclestone has apparently led the members of FOTA (Formula One Teams’ Association) to believe that they will be showing the full race on a time delay. The BBC, however, has seemed to play down these reports – they indicate an extended highlights show, clocking in at around 75 minutes. Either way, the show or taped race would air in prime time on Sunday – AKA the least valuable kind of prime time.

Still, the BBC package will air the day of the race, whatever the minutiae are.

This bizarre setup with the BBC acting as some kind of “Sky Sports Preview” is unique. No other sport, Motorsport or otherwise, operates this way, and the BBC agreeing to play second fiddle to Sky has made some observers distinctly uneasy.

Setting aside the practical and TV industry implications for a moment, let’s consider the financial impact of the deal. The Sky Sports/BBC Sport Partnership is paying out a combined £55 Million, up on the £40 Million the BBC had been paying out for the exclusive rights. The teams have been told this will factor out to about £1 Million per season extra paid from FOM to each team.

In F1 terms, £1 Million a season is…Not a huge deal. Even the back markers reportedly blow throw more than £30 Million to just show up and not completely embarrass themselves. For frontrunners McLaren, this is chump change. So one could reasonably wonder why they are going along with this so readily?

Consider also, McLaren (In particular) are majority funded by sponsorship revenue. This means they in particular should be concerned about any potential decrease in viewership. It seems like hubris to claim (As FOM, amongst others, have) that this deal might grow the F1 audience in the UK. The idea seems to be that being in BBC1 Prime TIme will inherently draw more people to the sport.

That…Sounds like a huge assumption. The argument seems to be casual fans will be more interested in a prime time highlights reel than in watching the race at midday (or odd hours for fly-aways). There is some merit to that idea, but it still seems like there is room to question it. We’re talking about a delay of six to, potentially, 12+ hours. It seems…Unlikely – to say the least – casual fans will go out of their way to avoid spoilers, but counterintuitively one could also reasonably question whether they’d bother watching the highlights reel once they knew the result?

Smaller teams also look set to get screwed – hard – by this. They get their best exposure for sponsors during qualifying and the exact kinds of “boring” bits the BBC’s editors are likely to cut for the highlights reel (For example, the leaders putting a lap on them). These losses will not in any way be mitigated by Sky Sports viewerships. Consider…

Sky Sports 1 enjoys a whopping 0.9% Audience share. This is HALF the audience share of BBC Three. It’s barely 0.2 more than the anaemic share held by BBC Four, which this deal is widely believed to have been orchestrated to save. Sky Sports 2, which will share Sky Sports 1’s duties as F1 broadcaster, has an eye-watering-ly small 0.4% share.

For comparison, the BBC’s F1 audience has averaged 4-5 million viewers, with peaks in excess of 6 Million – which is 10% of the UK Population, never mind UK TV Audience. And there is very little demographic overlap between existing F1 fans and Sky Sports subscribers – who are typically more interested in ball games like Association Football and Cricket.

So then, there is a strong argument that this deal will massively reduce the audience for Formula 1 in the UK. And it raises big questions about the financial impact of the deal on teams. There is one other area this deal could potentially have a massive impact, as suggested by Ewan Marshall at GP Focus: the prestige of the Championships.

By making only ten races live on free-to-air television, this deal implicitly adds prestige to the already prestigious Monaco and British Grands Prix. It will possibly have a similar effect on other events (Potentially including, regrettably, poor Grands Prix like the Singapore Night Race if they are included amongst the ten). What can’t be known at this stage is what impact this shift in emphasis to fewer, “marquee” races will have on the public’s perception of the Championships.

In American Motorsport, there are several Championships in various categories. What’s interesting, though, is that unlike in Europe (Where even casual fans tend to idolise championship winners like Jenson Button or Fernando Alonso), a lot of casual fans are more interested in which drivers win certain marquee events – like the Indy 500. Is it possible that, at least amongst casual British fans, this deal will decrease the importance of championships?

Are we looking at a future where casual viewership for most of the Grands Prix (Even most of the free-to-air Grands Prix) decreases because winning the big-name events like Monaco and Silverstone are seen as more important than winning the championship? Such a shift would take us back to the pre-fifties era of rand Prix racing, before the inception of the World Drivers’ Championship.

It’s a big if, but do we really want to go back there?

So there’s just a few points of interest from the Sky Sports/BBC Sport Joint F1 Broadcast deal. The crazy thing is, this is such uncharted territory, we have little to no way of knowing what the potential ramifications are. It could affect things we’ve not even considered.

Video Industry & Television Studies Academic Essay June 2011 – A vision of the future for British broadcasting

The following is an Essay written for the Video Industry and Television Studies Module of my Degree Programme at the University of Portsmouth. It received a 2.1 Passing Grade, my First Year overall was passed at First Class Standard. The title for this Essay was “Using an historical perspective, outline a vision of the future for British broadcasting” and it was printed for submission on June 10 2011 – note that certain details may have become outdated since then owing to rapid developments in the UK Media.

Introduction
British broadcasting has, throughout its history, been an highly changeable medium. It has evolved constantly to keep up with advances in technology, changes in taste and an evolving political situation. This pace of change, always considerable, has been accelerating at an ever increasing rate. Today, the industry faces its largest upheaval ever as trends in multiple areas are shifting concurrently.

As a result, British broadcasting in the future will be virtually unrecognisable…

A Brief History of British Broadcasting
In the early days of broadcasting in Britain, Television, the dominant form of broadcasting today, was mostly a dream. The broadcasting age was kicked off by the advent of the radio in 1922. That year, a number of independent stations began broadcasting and the BBC was formed, initially broadcasting in London.

Right from the start, the BBC was funded by a License Fee. Initially, the Broadcasting Receiving License. The industry as a whole was protected from collapse by forming a syndicate, with royalties being earned on all wireless sets sold. By 1925, though, change was already in the air as the wireless manufacturers wanted out of the deal. Meanwhile, the BBC’s leader (Lord Reith) successfully convinced the Government’s Crawford Commission to continue Public Service broadcasting.

As a result, the British Broadcasting Commission, which largely survives to this day, was established to oversee the nascent British Broadcasting Corporation under the authority of the Crown.

That set the scene for much of the remainder of the post-war period, until around 1935 when the BBC began experiments with television broadcasts, initially using Baird’s 30-line system. By 1936, “High Definition” had already arrived – 405 lines versus the 240 of the Baird system used at that point.

The service wasn’t available for long, however, as service was interrupted by the breakout of World War II.

Once the War ended and stability returned, efforts to resume television service began. In July 1946, the TV License was introduced and TV Service resumed, with the BBC showing a Mickey Mouse cartoon (Mickey’s Gala Premiere) which had been the last programme aired prior to the shutdown of the service seven years earlier.

Three years later, the BBC Television service began to expand outside of London. This expansion continued, with the BBC maintaining its monopoly, for a number of years. Then, in 1955, Independent Television – commercial broadcasting – arrived. And the shape of British broadcasting was altered once more.

This was just the first of a rapidly accelerating number of paradigm shifts in British broadcasting over the coming decades. In the 60s, BBC2 and colour television arrived. In the 70s, Ceefax launches – a nascent foray into information services for the broadcast industry.

But things really changed in the 1980s. Channel 4 launched, bringing commercial broadcasting to the state-owned broadcasting slate, with a focus on exploring new ground with programming aimed at niches not catered to by the existing BBC/ITV Duopoly – most notably the rising “youth” movement of teens and young adults, an increasingly distinct set of demographics.

On top of this, satellite broadcasting went online, beginning an industry in premium TV which would eventually become one of the most important sectors of British broadcasting. Amazingly, it was only in this same decade that British networks began 24-hour broadcasting, which just serves to demonstrate the rapid pace of acceleration in British broadcasting’s evolution.

By the end of the 90s, Channel 5; Six TV and a plethora of premium channels like Sky 1 and the Disney Channel had become available to British audiences. Whilst some were unsuccessful (Six TV went defunct in 2009 after a troubled and highly limited run in its ten year lifetime) others, like Sky 1, remain dominant forces.

Into the 21st Century, analogue broadcasts – satellite, cable and over the air – began to cease. Freeview, Freesat, Sky and Virgin Media Television have battled for eyeballs, and all four have launched new HD services in 1080i. But a growing competitor in the form of the world wide web, born in the 90s, has begun eating into television’s market – both with original content on sites like YouTube and blip.tv and through on demand distribution of television programming through services like BBC iPlayer.

This is the scene as we look ahead to the future of British broadcasting.

The Future of British Broadcasting: A Vision
As it stands, British broadcasting is engaged in a massive-scale “war for eyeballs”, caused by the plethora of services demanding the attention of the public.

There is little chance that all these services can continue to co-exist. As a result, going forward, it is inconceivable that we will not begin to see ever-increasing instances of convergence amongst these services. Already, we have seen television broadcasters like the BBC, ITV, Channel 4, BSkyB and more make their programming available online.
Some, like the BBC and BSkyB even allow viewers to watch television live as it is broadcast over the web – and even on mobile phones.

The future of British broadcasting will be crafted in this image. Video content is platform-neutral at its most basic level. As a result, video services from one platform can be delivered on another platform with minimal additional effort. We are beginning to see this coming to fruition in the form of Internet-Enabled TV sets and devices powered by software like GoogleTV.

These products, which will become increasingly prevalent in the coming years, invert the move of television to the web by bringing the web to television sets. As a result, audiences are able to watch live transmissions or on demand content from the comfort of their living room, on their big screen, without additional effort on their part.

The secondary result of this will be the resurgence of independent and even semi-professional video producers. With internet video services – which offer a far more accessible platform for smaller producers – with equivalent prominence to conventional broadcasters on TVs, independents and semi-professional individuals will be able to reach a far wider audience than at present, radically increasing the viability of small producers.

One possible side-effect of this will be the collapse of the Government’s efforts to launch a new sixth terrestrial broadcaster. The new sixth channel is being pitched has having a localised remit, patterned after the US Networks system, where a national Network produces prime time, late-night, (in some cases) daytime and news programming and local stations broadcast it to small areas (Eg. Cities) along with locally produced content like the local news and weather. Note, ITV used to be organised in this way prior to a mass of station mergers which has rendered the ITV Regions system a nominal one only.

This focus on localised programming will likely have its audience consumed by independent efforts making use of the web. Already, services lie Portsmouthlive.tv are serving the same basic purpose – at very low cost – without the government’s backing.

Similarly, it is highly unlikely that the proliferation of channels (Hundreds broadcast in the UK at present) will continue. Indeed, it seems likely that the number of channels available to UK audiences will plummet over the next ten to twenty years as the niche markets catered to by satellite and cable begin to be eaten up by web services. These niche channels are by far the most vulnerable to being subsumed by the web, as their inherently smaller audiences mean it will be viable for users to stream video live far sooner because less bandwidth will be needed.

As bandwidth concerns are overcome, channels with ever-wider audiences will be able to move online. Theoretically, if enough bandwidth can be added to the UK’s internet infrastructure, every channel currently on the air could be broadcast via the web. But that is a long way in the future.

One other thing seems likely: 3DTV will not achieve truly widespread adoption. Whilst their is a market for 3D content, the inconveniences of the technology make it ill-suited to broadcasting as it is generally consumed. Studies in the UK (The Guardian Online, 2010) and the US (NTDaily, 2010) have shown that an increasing proportion of the audience – particularly amongst younger viewers – prefer to multitask whilst watching television. This means their attention is divided between a TV, perhaps a laptop computer and even a mobile phone. They are social networking and reading the news whilst they watch.

3D doesn’t fit in this lifestyle, as it requires concentration to work. So whilst it has a market in event programming like live sport and movies, particularly movie premieres, conventional programming is unlikely to move to 3D in a meaningful way.

Conclusion
Ultimately, it seems possible that in the future, there will be no Freeview, no Satellite and no cable – as we know it. Instead, broadcasting will be consumed via an online portal with access to all the channels and on demand content in one place and an interface which scales from small screens (mobile phones) through laptop screens all the way up to big screen TVs.

Additionally, this portal could integrate with social networking services, to tap into broadcasting’s role as a creator of shared experiences and converge it with the advent of modern day social media.

Bibliography
Wearden, G. (2010) The Guardian Online: Multi-tasking media consumption on rise among Britons, says Ofcom study. Retrieved 9 May 2011 fromhttp://www.guardian.co.uk/media/2010/aug/19/multi-tasking-media-ofcom-study
Landry, N. (2010) NTDaily: Study shows increase in technology multitasking. Retrieved 9 May 2011 from http://www.ntdaily.com/?p=7975