ABC/ESPN will keep TV contract in merger

UPDATE #2 As we reported last month, and is now confirmed by the Indy Star – Open-wheel racing has a television package in place if it can unify, according to the Indy Racing League representative who negotiated the contract with ABC and ESPN through 2009.

Buddy McAtee, the vice president and executive producer of IMS Productions, said provisions for unification are spelled out in the contract signed by the networks and the league in November 2004.

ABC and ESPN have the right of first refusal to air Indy-car races in a new arrangement, he said. "That makes (the contract) still viable," McAtee said.

McAtee insists he has not been included in unification discussions with Champ Car World Series officials, but he's planning for the day when he's told a deal has been reached. Planning ahead is necessary, he said.
The last contract with ABC and ESPN took 19 months to work through. McAtee won't have that much time if unification happens for next season, as seems possible.

"We'll have to turn it around in 60 days," he said. "I have to be ready."

McAtee is working on the premise there would be between 20 and 24 races in a unified sport, and the challenge is to squeeze them into a calendar that begins in March and ends just after Labor Day so it avoids conflict with the NFL.

With or without unification, McAtee said he is pushing for the IRL to develop a Friday night race package much like the NFL did for Monday nights. He said track officials at Richmond, Va., Nashville, Tenn., and Kentucky are interested in the concept. So are the networks.

"ABC and ESPN are willing to take a shot at it," he said. Indy Star

03/30/06 A reader responds, Dear AutoRacing1: I see some flaws in your notions about ABC and the current IRL contract with them. For one, and most importantly, ABC apparently has total discretion on which IRL races are shown on cable and which are on network. The series has to be able to make those choices for their own promotional considerations, not a TV "partner" with other fish to fry, such as NASCAR next season. Also, ABC/ESPN's choice of broadcast personnel has been pathetic, with even IRL fans at times besides themselves over the lack of a quality broadcast and the over the top spinning that is engaged in – all hype and no substance. Champ Car has a superior broadcast team and superior production, based on what I saw last year.

A new series would be poorly served by ABC, given their track record (pun intended). As to your notion that the ABC deal not be jeopardized because they currently pay the IRL, that is not necessarily a good thing for a company that seeks growth with a stated plan. Time buys are not at all uncommon in sports (like the Masters golf tournament), and that situation is not a loser if the product has value, and an increasing audience. The time buyer can hire the production crew and thus set their own values for race broadcasts, including announcers and fluff pieces, and the time buyer keeps all the revenue. A good deal if you succeed, much better than being locked into business with a company that has production values that clash with the racing bodies' goals. ABC has forgotten how to produce auto racing since they lost NASCAR, and getting NASCAR back is fraught with all sorts of bad scenarios for any other racing series they have a contract with.

As it is, I say that the IRL should be sold to Kevin Kalkhoven and Gerry Forsythe, the Indy 500 broadcast rights offered to ABC if they want them, and the new company can then negotiate for a TV partner aside from ABC and its new (rightfully so) NASCAR agenda for the rest of their races. Or they can simply seek another deal. Why would a new company allow ABC to negotiate down the contract terms anyway, when the new company will have more value? As to the name, the "Indy Car World Series" will do just fine, and serve both the goal of name recognition, promoting the Indy 500, and retaining the true nature of the series for both the present and the future. Tom Finlay, Deer Island, Oregon

Dear Tom, While you make some good points, the fact of the matter is that the Hulman George family and the Indy 500 have a long relationship with ABC that simply isn't going to go away. In addition, ESPN's international TV distribution is second to none. And last, ESPN, ESPN2 and ESPN News have been promoting the heck out of the IRL this season already. They are a good partner. Sure, there needs to be some changes in the announcing booth, but given the current state of affairs, they are not going to get a better TV deal right now, especially one that pays them as well. Perhaps in 2010 when the "new" series is in better condition. Mark C.

03/29/06 Some have asked us whether the current IRL TV contract with ABC would get in the way of a merger between Champ Car and the IRL before it expires in 2010. As we understand the contract wording, if a new company were to be formed then it would render the contract null and void and ABC could try to negotiate down the contract terms. However, there is a simple solution. The IRL and the IndyCar name will be retained because IndyCar has name recognition worldwide.

We can see Tony George taking on a new partner in the ownership of the IRL. Whether it would be just Tony and Kevin Kalkhoven, or Tony, Kevin and Gerald Forsythe is not known, but essentially the IRL would buy or assume Champ Car and the Champ Car name would be dissolved. This would allow the same company, the IRL, to retain the contract with ABC/ESPN. This is a key element in the negotiations because it is imperative that the ABC deal not be jeopardized – they actually pay the IRL for their races, whereas Champ Car has to buy time.

The key elements of the deal as we see it:

Name of Series: Indy Car World Series or some derivation
Name of Cars: IndyCars (Just like it was in the CART days and as it is now for the IRL)
Ownership: George, Kalkhoven and/or Forsythe
TV Contract: ABC/ESPN (retain existing contract)
Cars: New Panoz Champ Car (All teams will buy new cars for 2007)
Engine: Existing Champ Car 2.65L Turbo with common ECU for both Honda and Ford
Events: Combination of most healthy of the two series with more road and street circuits than ovals for safety and cost reasons – ovals are simply too costly and too dangerous. Sport can't afford all the death and destruction anymore.
Support Series: New Mazda Atlantic cars. Existing IPS teams would join Atlantic Series and the Atlantic Series would come under IRL umbrella.

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