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Rank Driver Points
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31 Alex Tagliani 28
32 Townsend Bell 22
33 Pippa Mann 21
34 Martin Plowman 18
35 Buddy Lazier 11
36 Franck Montagny 8
Part 2: A look at IndyCar's horrid TV deal

by Brian Carroccio
Tuesday, January 15, 2013

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Brian Carroccio
Judging from your reaction, Part 1 of our article discussing IndyCar's television deal, fulfilled its intended goal.  In what undoubtedly elicited the most voluminous response of any article I have written for AR1, many of you expressed shock at the extent of the problem facing the Izod IndyCar Series.

And to be clear, let the record show our intent was not to shock, or sensationalize for the mere sake of shocking or sensationalizing.  Simply put, we believed the facts spoke for themselves, and if you happened to come away shocked, then so be it.

Now, if Part 2 serves its purpose, you will probably come away slightly more upbeat than you did after Part 1.  However, you will be equally aware that NBC Sports and IndyCar are both facing an incredibly uncertain future.  Further, you will also realize that IndyCar has put itself in a position, in this era driven by television ratings, in which its future prospects are greatly intertwined with those of NBC Sports. 

Yes, IndyCar has surrendered a large degree of the ability to control their own destiny in partnering with NBC Sports, rendering themselves a mere passenger on a train headed for We Don’t Know Where.  Subsequently, this second installment will spend more time focusing on the future of NBC Sports itself, rather than IndyCar.  And while there is evidence suggesting NBCSN could be poised for a breakout, a future of sunshine and daisies, I cannot promise.

Before getting started with Part 2, where we look at the future of IndyCar and NBCSN, it is probably worthwhile to briefly review Part 1.

In simple terms, Part 1 essentially outlined the problem.  We argued that IndyCar's television shortcomings were not simply a matter of what everyone already knows: the ratings stink.  Nor were the poor ratings, something that could necessarily be enhanced with better promotion, better branding, more favorable time slots, etc, as so many seem to flippantly suggest.  Certainly, those matters need to be considered, but our research revealed those were the least of IndyCar’s problems with regard to NBCSN.

If anything, a look at the performance of other NBCSN properties, led us to a much more worrisome realization: Not only are IndyCar's television ratings minuscule, garnering about a third the audience on cable television it did five years ago, but one could argue that relative to the capabilities of the network, IndyCar has actually been maximizing its potential on NBC Sports.  While there were clearly other issues I alluded to (a lack of IndyCar brand awareness, the hegemony of ESPN) the biggest issue facing IndyCar was the incredibly paltry awareness and reach of NBC Sports, something that has not been helped by the recently concluded NHL Lockout.

Now, I want to make very clear that in highlighting the deficiencies of NBCSN, I am not outing the network as the root cause of all that ails IndyCar.  Certainly, the start-up network has its myriad of issues, which aren’t doing IndyCar any favors.  However, I would offer that the NBCSN deal is more a symptom of IndyCar's problems, rather than the actual problem itself.  After all, IndyCar was forced to align with NBCSN, or Versus as it was then known, because they had mismanaged the sport to where they had no other option.

Simply put, those who run IndyCar need look no further than the mirror to find what ails them.  And if they do not change the pathetic way in which they do business, the Izod IndyCar Series will not thrive on NBCSN or anywhere, for that matter.

Still, the NBCSN deal runs through 2018, and IndyCar is essentially stuck.  Unless something unforeseen occurs, IndyCar likely has no choice but to make the most of the situation.  Because at the end of the day, IndyCar's success or failure will almost certainly be linked to the success or failure of NBCSN.  This article will help readers better understand NBCSN’s strategy going forward. 

To begin, as noted earlier we are entering an incredibly uncertain future with regard to sports television programming.  NBC, Fox and CBS, are each attempting to mimic the wildly successful ESPN model of 24-hour sports programming with an all-sports cable outlet.  CBS College Sports was re branded CBS Sports Network in February 2011, and is available in an estimated 48 million homes.  SPEED, a Fox property, is expected to be re branded Fox Sports 1, sometime in 2013, and is available in an estimated 80 million homes, about the same as NBCSN, or put another way, an estimated 19 million less than ESPN and ESPN 2.

Of course, numbers only partially explain ESPN's hegemony.  While I cannot begin to even attempt putting a number on this, I've been to a few restaurants/pubs/sports bar-type establishments in my day.  And my informal survey would tell me nearly all of them are tuned to one of ESPN's stations, and very few if any, to say, NBCSN.  If you receive breaking sports news via radio, phone, Internet, etc., and want further coverage where do you go?  While I grow less and less fond of the network all the time, I must admit the answer is ESPN, ESPN2, or ESPN NEWS or ESPN.com.  Not once have I thought to “check out NBCSports.com.” 

Presuming ESPN's hegemony remains, the question then becomes which of these emerging sports programming entities are best situated in relation to each other.  Yes, before they begin to even consider rivaling ESPN, they will likely have to duel each other for market share and prominence, which of course, arguably further cements ESPN’s hegemony.  Thus, for now, we will analyze the three upstarts in relation not to ESPN, rather each other. 

To start, all 3 of the upstarts, like ESPN, have a partnership with the American sports Goliath, the National Football League.  This creates the possibility of cross-promotion, auxiliary programming, etc., all gravy training off the juggernaut-NFL for all three.  While each already does this to varying degrees, the NFL factor is essentially, a wash in terms of competitive advantage. 

Nevertheless, a case can be made that NBCSN is best positioned relative to the other two.  While there are other elements to this, NBCSN is available in more homes than CBSSN and has a head start on Fox Sports 1.  Yes, strange as it to say, NBCSN actually could be positioned more favorably than the other two.  Still, what looks likely to make or break NBCSN is whether or not its unique strategy succeeds. 

And what is this strategy, you ask?  Well, judging from recent activity, NBCSN seems to be adopting a strategy that aims not to parallel their domestic rivals, rather transcend them.

Curious?  Let me explain.

This fall, NBCSN added two properties that boast a global audience: Formula 1 and the Barclay's Premier League, better known as the English Premier League.

Formula 1 is certainly familiar to most AR1 readers, and I will not spend more time on it here than need be.  Certainly, F1 may help with IndyCar cross promotion, with both on NBCSN.  However, I don't believe F1 is going to necessarily grow NBCSN much beyond its current reach.  The Premier League is an all-together different matter.

See, the Premier League is actually a story of unfathomable success that in sheer size dwarfs any American sporting property.  Formed in 1992, by the top 20 teams in English association football (soccer), the Premier League shrewdly positioned itself to capitalize on the rising scope of cable television.  While it’s a long story one of countless technological advances, globalization, and the vast reach of the British Empire stemming from the age of Colonialism, the Premier League has achieved something that would have been unthinkable two decades ago: it has become the first domestic sports league in world history with a global following. 

And while domestically, the NFL is gargantuan; from a global perspective the NFL pales in comparison to the Premier League. 

Of course, you’ve been conditioned to think otherwise.  For example, during any given Super Bowl, an announcer may say something to the effect "the Super Bowl is broadcasting in one billion homes around the world."  While it may be true that one billion homes can access the Super Bowl, what is conveniently omitted, of course, is one billion people are not actually watching the Super Bowl. 

In fact, the NFL does not actually publish an official record of how many are watching worldwide because the NFL knows its sport is essentially, a domestic phenomenon.  Sure, 120 million plus Americans may be watching, but worldwide a generous estimate would be under 200 million.

As for the Premier League, well, some estimates claim not that a billion people are capable of watching, rather one billion people have actually watched--a single game.

Yes, according to ESPNStar.com, 1 billion people watched a 2007 match between Arsenal and Manchester United.  Likewise, they claim that a half billion people watched a 1-1 draw between Liverpool and United about a year ago.  In aggregate, ESPNStar claims 4.7 billion people worldwide watched the Premier League last year.

The Star also claims that of the 2 billion football fans worldwide, about 70% or 1.4 billion, actively follow the Premier League. Whereas, Reuters claims the NFL had 200 million "unique viewers" in 2011, according to an auxiliary of the worldwide leader, the Premier League’s following outdrew the NFL by a factor of 7.  Yes, nothing against the NFL, which is a monumental success story, but compared to the Premier League, the NFL is very small. 

Additionally, great evidence suggests the Premier League, and soccer for that matter, is growing exponentially in the United States, and it has significantly over the last half-decade.  Television ratings have risen, and evidence shows more people are playing soccer.  Unscientifically, we’ve certainly witnessed many more people, particularly youngsters, with Manchester United, Barcelona, Arsenal or Chelsea jerseys in recent years.  And with social networking, the Internet, and hundreds of television channels, American kids today know Lionel Messi, Wayne Rooney, and Robin Van Persie.  After all, it doesn’t matter that Rooney plays soccer in a rough, drab, industrial, provincial, Northwestern English city, because well, you can get Rooney and Manchester United games, from anywhere.  Yes, while a generation ago, such stars were foreigners, technology and globalization have shrunk the world, shrunk the disconnect that existed a generation ago. 

And while I can go on, suffice it to say, the Premier League, and soccer, are growing in America, essentially the one nation is has yet to conquer. Will this growth continue with the move to NBCSN?

Of course, any assertion that soccer will be successful in the United States will invariably be met with a large degree of skepticism.  And to be clear, I’m definitely skeptical myself. 

After all, we Americans tend to be a rather provincial bunch.  We like watching other Americans.  We’ll watch Olympic swimming, when Michael Phelps is on, but otherwise are unconcerned.  With regard to soccer, we’re not into scoreless draws, we don't like prima donnas faking injuries, and soccer, has well, never really been American.  According to most, it never will.

Interestingly, that's not what Jon Miller, president of programming for NBCSN believes.  To Miller, "We are becoming a much more cosmopolitan society" (not totally sure I agree).  Also, Miller notes "a lot of people are living here who moved here from other countries, and we want to take advantage of that." (true).

Yes, the strategy of NBCSN, as it pertains to F1 and the Premier League is to capitalize not on what America is, rather what Miller believes America is becoming in this ever shrinking world.  With globalization, technological advances, and people of different ethnicities relocating to America, Miller is betting they are more likely to be interested in Manchester United than say, the Pittsburgh Steelers.  Such people may have no prior affiliation with the New York Yankees or Dallas Cowboys, but do know about Chelsea and Fernando Alonso. 

In other words, Miller believes America is changing and NBCSN is positioning itself to take advantage of that change.  Specifically, with the Premier League, Miller believes a more cosmopolitan America is ready to embrace a sport it has long shunned.  And what does all this mean for IndyCar? 

To start, the notion of globalization potentially helps IndyCar in that its diverse driver lineup has long been considered a flaw of the sport.  If Miller is correct, and America is in fact, becoming less provincial in scope that would bode well for IndyCar.  If people are willing to watch Rooney, you’d presume they’d have an interest in Justin Wilson.  Or at least, it would stand to reason that nationality would not be the determining factor in not watching. 

And if we knew what INDYCAR's business plan, or heck if they even have a plan, then we could probably draw some reasonable conclusions with regard to the changing landscape.  But as far as I can tell, all we've heard so far from new Hulman and Company (the parent company of IndyCar) CEO Mark Miles is he wants to cut IndyCar Leader Circle Money, yet spend an estimated $20 million to enhance a NASCAR event, by building lights at Indianapolis Motor Speedway.  Yes, Miles wants to cut IndyCar money but help NASCAR.  However, regarding anything substantial concerning IndyCar's future, the Miles' regime has been deafening with their silence.

Certainly, as we saw in part 1 with the example of women's softball, a rising tide theoretically lifts all boats.  The fact women's softball, had the reach of ESPN, allowed it to perform in a way IndyCar could only dream of.  If Miller is right and the Premier League and F1 are properties that capitalize on a changing America, IndyCar would theoretically benefit.  If young people who maybe once watched Major League Baseball find the Premier League of greater interest, IndyCar would stand to benefit.

Of course, there is one very haunting scenario in which IndyCar would not benefit. 

In October, NASCAR extended their deal with Fox through 2022 in October, which sees Fox carry 13 races including the Daytona 500.  However, NASCAR's deal with ESPN and TNT for the balance of the schedule ends after 2013.  Where is NASCAR going to wind up?

If the executives in Daytona read Part 1, I don't know why they would want to ally with NBCSN.  Despite the dip in viewership on ESPN, and their lousy NASCAR coverage, one would imagine NASCAR would want to continue with the self-proclaimed worldwide leader.  Also, I can't imagine SPEED becoming Fox Sports 1, carries a ton of interest for NASCAR.

However, if NASCAR were to come to NBCSN, they would be a rising tide that would certainly not want the IndyCar boat lifted.  While I can give numerous examples, we've seen time and again, when NASCAR comes to a network or market, IndyCar is often marginalized.  Whether it is auxiliary programming, or coverage of practice and qualifying sessions, NASCAR tends to exert its might in a way not beneficial to IndyCar.

Perhaps, of greater concern is NASCAR has often successfully capitalized on an event or outlet IndyCar has grown.  Could NASCAR be eyeing NBCSN as an upstart business working out its racing kinks on IndyCar?  I’m not sure.  But if you for a second think NASCAR isn’t looking for a way they can capitalize on one of IndyCar’s properties, I have a few MPH shares, I’d be willing to sell you. 

Now, if we are to take Miller at his word, nothing against NASCAR, but I wouldn't exactly consider the sport "cosmopolitan."  NASCAR is like most sports in the United States, a domestic phenomenon.  Still, money talks, and time will tell where NASCAR signs its next lucrative television deal. 

Of course, if IndyCar is not in sync with the goals of NBCSN, and the series has no business plan going forward (I'm not convinced they do), then all of this may be moot anyway.  The series will continue its gradual fade into sporting oblivion. 

Sadly, the very unfortunate reality that can be drawn from studying the uncertain future of sports programming, is IndyCar has seemingly left its prospects for success and failure in the hands of another.  Having essentially hitched its wagon to NBCSN’s aggressive, somewhat outside the box strategy; IndyCar is essentially taking the same gamble NBCSN is. 

And whether that is a good or bad thing?  I’m not sure anyone knows, but if NBCSN fails to grow in popularity, IndyCar will only be worse off in the coming years.  We already saw a drop in popularity/TV Ratings from 2011 to 2012. 

What will 2013 and beyond be like?

I wouldn't take that bet.

Brian Carroccio is an IndyCar columnist for AutoRacing1.com. He grew up around racing as the son of a longtime SCCA crewman, who regaled him with romantic tales of Jimmy Clark and Dan Gurney.  His first vivid memory of Indy car racing is Danny Sullivan’s 1985 “Spin and Win,” at Indianapolis.

Brian lives in Rockville, MD.  As a lifelong fan of the Washington Redskins his favorite colors are burgundy and gold.  He is also a passionate supporter of Manchester United.

For witty insight on our beloved sport of Indy car racing, and thoughts on other topics of interest to Brian, you can follow him on Twitter @BrianC_AR1.

Feedback can be sent to feedback@autoracing1.com

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