Saturday, September 3, 2011

SBK and MotoGP: Is any town big enough for the two of them? Don't worry, they don't even know they're in the same town

I'm reading news that Bridgepoint Capital has acquired InFront Sports, which effectively means that the company that owns Dorna (holder of MotoGP's media rights) now also owns the rights to the World Superbike Championship.

Even before this development, SBK and MotoGP have operated at, at best, a sort of uneasy truce. The latest source of tension, of course, is MotoGP's creation of Claiming Rule Teams, which blurs the 'pure prototype' status of MotoGP by allowing the use of modified production motors. Colin Edwards has openly discussed his 2012 season plans now, and has said he hopes to get Yamaha World Superbike-spec motors -- and that he wants to poach Yamaha's top SBK engineer -- for his CRT.

The implication in most of the reporting about Bridgepoint's acquisition of InFront is that the change in ownership status might trigger some kind of rationalization at the top level of motorcycle racing.

Don't count on it.

Leave aside the fact that anyone with big-business experience will tell you that -- not withstanding the Tea Party's idiotic kowtowing to the so-called free market -- it's unwise to expect businesses to operate rationally at all.

The real reason that it's unlikely any kind of rationalization will result from this deal is that it's unlikely it will really occur to anyone. Dorna represents about 5% of Bridgpoint's portfolio. And the acquisition of InFront can only be about one thing, really... FIFA. 

You see, in addition to SBK and a range of sports properties from show jumping (that's horses, not Evel Kneivel wannabes) to curling, InFront also holds the media rights for the Federation Internationale de Football Association. This is the giant, famously corrupt governing body of soccer, and the World Cup. As much as MotoGP and World Superbike are big deals for us, the global audience -- and attendant commercial opportunities -- for motorcycle racing are trivial when compared to soccer. Sony alone spends about $50M/year on FIFA sponsorships. And in a weak global economy, soccer's relative strength is enhanced by the facts that it costs almost nothing to participate in the sport at the (literally) grassroots level, that it has vastly better terrestrial/free TV packages in place, and that there are far more events in total with lower average ticket prices, making it more accessible to cash-strapped fans.

When Bridgepoint's board reviewed the due diligence on its InFront acquisition, I doubt that more than a minute was spent discussing SBK. And most of that minute was occupied when one old boy asked, "Really? We own motorcycle racing." At that moment a young assistant leaned in, whispered something in his ear. The old boy raised his eyebrows, muttered "Frightful things," and went on to ask, "How's Sepp Blatter doing these days?"

Still, it's fun to speculate about how an informed, intelligent owner could rationalize SBK and MotoGP. I'll get around to that soon. But right now I have to go the farmer's market. Don't want to miss the last of the summer's corn and fresh Missouri peaches, tomatoes...

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