Let's look at all the existing WT teams, when they started, and what level they commenced at. For the sake of argument, let's take the year they rode their first Tour as the year they effectively hit the top rank. Imprecise as it is, it'll serve a purpose:How many World Tour teams have grown organically from the lower ranks in recent years?
This is a fair point but we also have to accept that, certainly since the advent of extra sportif sponsors in the 1950s and 1960s, cycling hasn't had a fixed funding model, it has a mixed funding model. It relies in part of rational economic decisions (sponsorship with a measurable ROI) but it has also relied extensively on passion projects: sugar daddies and the like playing bicycles. Today, sport in general is increasingly moving into a new phase of funding, that of soft power, which has largely been exerted through event promotion (London 2012) but is also trickling down to the way teams are owned and financed (PSG, as you already pointed out).For the most part though, a lot of the teams at the very top are stable because they are mostly split between two categories: springing out from national projects or nationally-funded projects (Sky/Ineos, Katyusha, Astana, Mitchelton-Scott for national projects, Bahrain and UAE for nationally-funded projects), or long-term traditional teams who have been there since before the ProTour began, often with sponsors who also predate that (Movistar, Lotto, Quick Step, Groupama-FDJ, Ag2r, Jumbo-Visma). Some of which (Movistar and Jumbo most notably) have become sort of national projects by default, with the loss of or moving out of their main top level rivals, or their being swept aside to make room for the newer projects.
Quite what the problem here is I cannot say. What I will say is that in the decade and more since JV kicked the economic debate into gear with his 10 Point Plan, very little attention has been given to Division II/Division III teams (Pro Conti / Conti), all the talk has been about Division I (World Tour). The Rapha Roadmap is really only about turning the World Tour into a series of calendar slots that can be sold off à la F1. The Outer Limits bros are just serving FUD-laced clickbait. None of the breakaway leagues cared a fig about the lower divisions. Even the recent UCI survey seemed to be geared solely toward top level men's road racing. So, really, the debate isn't happening. The problems are not being identified, not in a proper fashion. All we get is people blaming British Cycling for the loss Team Wiggins and One Pro, or suggesting that American cycling can be saved by turning it into competitive drum and bugle corps.The problem is that now the number of spots available for them is limited, there's little incentive to start a big, ambitious project at the ProContinental level, as used to happen not infrequently, while the global financial crisis and its impact on domestic cycling (especially in Italy and Spain) has strangled some of the benefit of riding at this level as the domestic calendars are not as strong, meaning you need a sponsor willing to drop the cash to afford a World Tour calendar to get any kind of exposure beyond breakaway status unless you can guarantee a major invite like, say, Cofidis; smaller, regional hobby sponsors cannot sustain a calendar that is more international, and that is now absolutely required because many national calendars have suffered so that any ambitious riders will quickly outgrow the level, unlike a decade ago when wildcard teams - even discounting Cervélo and BMC - provided genuine threats to win major races with the likes of di Luca, Petacchi, Mosquera, Garzelli, Rujano, Pozzato, Visconti, Voeckler, Carrara, Hoogerland, Pozzovivo, Guardini, de Waele, Tondó, Scarponi and Simoni.
I more or less came to F1 in the Schumacher era because there was something about the guy I liked: he had a work ethic, I think, that for some reason resonated with me. I left after he went. Point here is that what attracts one fan can drive off another. It's always a balancing act and there's no quick and fast answers.Sky/Ineos may not create the level of antipathy that an internet forum may suggest (after all, contributors to an internet forum on the topic will always tend toward the more hardcore fans) but a predictable spectacle also serves as a limiter on the number of new fans drawn in, or drive some fans no longer attracted to the spectacle away. I was one of the people who walked away from Formula 1 during Schumacher's reign of terror, and there have been several years recently where I simply haven't bothered watching the Tour de France - any of it - because I'm simply not interested in watching it.
I don't think we can wind back the clock to a kinder, gentler time (it didn't exist) but nor do I want to see us marching blindly into a future that could cause more yet more problems. What the middle ground is, that's what I'm hoping to find out.“cycling at the top level has become too global (and thus too expensive) for smaller local sponsors but, at the same time, is not global enough for big multinational companies.”
The last quote is bang on “cycling at the top level has become too global (and thus too expensive) for smaller local sponsors but, at the same time, is not global enough for big multinational companies.”I more or less came to F1 in the Schumacher era because there was something about the guy I liked: he had a work ethic, I think, that for some reason resonated with me. I left after he went. Point here is that what attracts one fan can drive off another. It's always a balancing act and there's no quick and fast answers.
The UCI survey offered some very, very loaded questions about budgets and it seems clear at this stage that Stapleton (into whose lap this falls, I think) is looking to push something through. But that survey also offered lots of other loaded questions that impact unpon our perceptions of spectacle, most notably concerning the use of radios.
I've already said I'm not really a fan of a cap (salary / budget) largely because I see it as window dressing (it's too easy to abuse and get away with abusing). But if that window dressing came with other measures that helped bring about spectacle, I'm probably not going to be up in arms about it.
One key point I want to make in closing here is something Daam Van Reeth offered in his cycling economics book. I disagree with him on many things (especially that bloody Rapha report he was involved with) but on this I think he nailed cycing's current problem, in particular the issues you are trying to introduce here with regard to Pro Conti level racing:
I don't think we can wind back the clock to a kinder, gentler time (it didn't exist) but nor do I want to see us marching blindly into a future that could cause more yet more problems. What the middle ground is, that's what I'm hoping to find out.
I don't see why you would lie about this. Do you think they would have been interest in other teams who had a similar business set up but not Sky's success?...I know not everyone here believes me, but Sky had a few global sponsors show interest. If teams can up their game, the money is potentially there...
Yes, I do. I can take our investment into the Ineos deal and give a really accurate ROI over the years as they developed their model. A big corporation would be able to look at a team now and project its model forward based on the investment, and therefore project the future ROI. No doubt at all. Hence some financial players coming in and buying mid-tier soccer teams, they can project the future return from their investment now.I don't see why you would lie about this. Do you think they would have been interest in other teams who had a similar business set up but not Sky's success?
Again, I don't think this is true. The Year before the cap was introduced Green Bay won the Superbowl against Pittsburgh. Since it was introduced neither team has made it back. The year before that, it was teams from New Orleans and Indianapolis, the year before that, teams from Pittsburgh and Phoenix. None of these teams have returned to the Superbowl. In terms of metropolitan area size Green Bay is 158th out of 384, Pittsburgh is 27th, New Orleans is 46th, Indianapolis is 34th and Phoenix is 11th....The Cap in the NFL helps keep small market teams competitive...
I've visited the McClaren cycling operation. Proven, experienced guy in Rod Ellingworth will be developing the team and very good riders already lined up. Professional commercial management behind the scenes. Huge resource in cash terms and access to things like engineering, aerodynamics and data management. The operation is very professional.McClaren just proved at the Indy 500 they can't run an Indy Car team on their own. I really hope they aren't going to try to run a cycling team.
To driving fans away, there are other ways to do that as NASCAR has done extremely well since the mid 2000's. They rode a way of expansion away from their base and when those new fans got bored or for other reasons started leaving, the core fans were already fed up. This was done with rule change after rule change to try to compete with other sports including the total revamp of their points system to the now "stages" during a race to the short lived let's put everyone on the track at the same time to qualify on ovals. On road courses, sure it can work, but they proved that it doesn't work on ovals. Got bad enough that they finally went back to single car qualifying which the fans never complained about in the first place.
The Cap in the NFL helps keep small market teams competitive. Of course revenue sharing of their major TV network deals are also a part of that. Which is something else that cycling doesn't have. However, that's also not feasible as most races are barely bringing in enough revenue to survive.
In the second paragraph, Vaughters argued that such a 10-year franchise system would create an asset that teams could exploit in times of need: “The ability to sell equity would be the savior of many a team in lean times when sponsorship dollars are short.”giving contractual participation provides guarantees to the teams and allows for them to cease the "hand to mouth" year-to-year fight for sponsor dollars. If a sponsor wants to be represented in Le Tour, for example, there are only so many options. This drives sponsorship to existing organizations and allows them to build long term and stable partnerships. This as opposed to new sponsors entering the sport with unproven or unstable organizations which can potentially damage current teams' and events' respective value by pirating riders and making the sport confusing to follow for fans (ie - who does he race for again?).
These limited slots, and their contractual rights to participate in top events, create value for the organizations holding the contracts. This value, in turn, allows raising money through sale of equity in said organizations, which hold the contracts for entry into the top events. The ability to sell equity would be the savior of many a team in lean times when sponsorship dollars are short. Both creating a limited and defined sponsorship market in cycling and creating value that allows different forms of fundraising outside of pure sponsorship would allow athletes and other employees of pro cycling teams to exist in a more stable and calm environment and keep them from making poor decisions in insecure and unstable moments (do I have a team next year??!). This in turn allows greater inroads to be made in anti-doping movements and culture changes, as people aren't fearful of their future quite so much.
Forbes helped explain the problem:The price of an NBA team has been skyrocketing. The Brooklyn Nets, for instance, just sold at a record valuation of $2.3 billion.
That’s been a blessing and a curse for the league. When the NBA’s limited partners, or LPs [the holders of minority stakes in teams], want to sell their holdings, it can be hard to find interested parties -- especially since the stakes usually come with limited power. LPs have recently put holdings up for sale and pulled them back because they didn’t fetch the terms the owners wanted.
Currently, we're generally told that cycling teams have no value. When the Discovery team ended, it just ended, Tailwind Sports got zip. Ditto when Oleg Tinkov and Michel Thétaz walked away from their teams. But, some teams are more canny than others. Pat Lefevere sold the majority of his team's management company to the Czech billionaire Zdeněk Bakala (70%) and Bakala's Dutch business partner, the telecoms millionaire Bessel Kok (10%). And, of course, Vaughters and Doug Ellis sold Slipstream Sports to EF Education First. Even with their current brevity (three years), World Tour licences are worth something.The average value of an NBA team is $1.9 billion, up 13% over last year and three times the level of five years ago. This appreciation in values has created a “liquidity problem” in the sense that it is much more difficult to find buyers of small stakes–limited partners who would own perhaps 1% to 5% of the team and have no say in how the team is run.
In the NBA, the controlling owner must own at least 15% of the team. There is a limit of 25 partners, each of which must own at least 1%, though some teams have been grandfathered in when it comes to ownership rules.
Fans believe that the appeal of road cycling lies first and foremost in the attitude of the riders and the characteristics of the events, although there are some aspects that reduce this appeal. The three aspects most commonly mentioned are earpieces (48%), the use of power meters by riders (40%) and the variations in budgets between teams (39%).
The potential domination by a small number of teams is viewed negatively by many fans, with 71% believing that the concentration of the best riders in a select band of teams has a negative impact on the quality of entertainment. Similarly, 76% believe that the difference in budget between teams can make races less interesting.
WRT the point you made in that post relating to engaging with sponsors - I see that the fan survey is being followed up through September and October with "consultation with key stakeholders." Did any sponsors get an invite, do you think?This discussion sent me back to my archive and find this blog post from a year ago -
Sponsorship in pro cycling from the perspective of the sponsor. The challenges facing teams and the needs of the sponsor. Can the model change?stephenmoon.com
Apologies if I have missed something in the discussion but I don't think this is a fair analysis. It ignores that the Patriots have an incredibly easy division with underperforming rivals (despite Jets and Dolphins having large markets) and that they have a once in a generation calibre head coach and gain AFC top seed more often than not with their eyes shut. So any analysis of the AFC Conference winners pretty much goes out the window because it is skewed so much by the Patriots (who have to rebuild massive swathes of their side every couple of years due to the cap). I'd argue Belichik would have a load of success even if he was heading a side in a smaller market (like Reid in Kansas, or in recent years the Panthers, Seahawks, Saints - all competently coached sides in the NFC that are dwarfed by far larger markets in their conferences and divisions). He is a master of marginal gains (spygate, deflategate etc).Again, I don't think this is true. The Year before the cap was introduced Green Bay won the Superbowl against Pittsburgh. Since it was introduced neither team has made it back. The year before that, it was teams from New Orleans and Indianapolis, the year before that, teams from Pittsburgh and Phoenix. None of these teams have returned to the Superbowl. In terms of metropolitan area size Green Bay is 158th out of 384, Pittsburgh is 27th, New Orleans is 46th, Indianapolis is 34th and Phoenix is 11th.
Conversely, following the introduction of a cap, teams from Boston (10th), New York (1st), Los Angeles (2nd), San Francisco (12th), Seattle (15th), Atlanta (9th), Denver (19th), Charlotte (23rd) and Baltimore (21st) have made it to the Superbowl.
So it's possible the cap has had a negative effect on the competitiveness of small market teams, and at best it's had no effect. Of course, this is one measure of competitiveness and only takes into account conference Champions. We could look at the divisions, but this gets much more noisy due to how teams are split and what games are played each year. As such, I think looking at Conference Champions is fair.
Minnesota is medium size market at best.You seem to have missed all the other teams in my analysis.
Seattle is 15th, Kansas City is 31st, Charlotte is already listed at 23rd and Louisiana is 46 a shout listed for pre-cap. Again, at best that makes it a little more even.
I’m not making any claims, I’m just listing the data. Minnesota is a very good example of a huge market team that haven’t even won a conference title since 1976 (?). That’s a long time before the cap came in.
Minnesota is 16th, higher than Detroit, Tampa, Denver, Charlotte, Pittsburgh, Las Vegas, Cincinnati, Kansas, Cleveland, Indianapolis, Jacksonville, Baltimore, New Orleans and so on. They also don't share that market, or the rest of Minnesota, with any other NFL team. Huge is wrong, but I'd put them at the very top of the middle size if not in the top size of markets.Minnesota is medium size market at best.
In the USA, all of your examples are considered smaller marketsMinnesota is 16th, higher than Detroit, Tampa, Denver, Charlotte, Pittsburgh, Las Vegas, Cincinnati, Kansas, Cleveland, Indianapolis, Jacksonville, Baltimore, New Orleans and so on. They also don't share that market, or the rest of Minnesota, with any other NFL team. Huge is wrong, but I'd put them at the very top of the middle size if not in the top size of markets.
Where's the hurt? What is actually wrong with the model?I think though that the lack of any real team revenue is what hurts the model
Again, you'll need to explain that. They earn their sponsorship revenue. They earn whatever additional revenue they can come up with.The teams don't really earn anything.
There are dozens of TV deals. And no teams are operating at a loss.There is no TV deal to ensure team profitability like in the other pro sports.
You see cause and effect, but is there really a correlation?the WT is financially small money, because of those limitations
The selling equity model is not a good way of funding the sport. It is a fantastic way of rewarding team bosses. And of inviting in more of those "unsavoury types" many seem to object to (witness the world of soccer). At the moment, teams do have an asset they can sell: Pat Lefevere cashed most of his in, the estate of Andy Rhis cashed their's in, Jonathan Vaughters cashed his in, Igor Makarov appears to be about to cash his in: a World Tour licence is not without value. You just have to sell it at the right moment. A "low" market is never the right moment, you can really only do it in a "high" market (demand > supply)I like the 5/10 yr licence model and the ability to sell equity. The potential is there to also sell equity at a high, not just a low, so it could inject more money into the sport.
This is a favourite lie from those who insist that cycling's failing economic model is collapsing around us. Up to relatively recent times, teams had to pay to enter races like the Tour de France, and they had to pay to cover their accommodation throughout the race, shoddy and all as it often was. Today, the accommodation is much improved, the race organiser foots the bill, and the teams receive a UCI-mandated and AIGCP-agreed appearance fee for taking part in the race. They are paid to play. That appearance fee is not coming from loose change found down the back of the sofa. It is coming from the race organiser's revenues. Which include TV revenue. So, teams are getting a slice of the TV revenue.There is exactly zero TV revenue that teams get.
World Triathlon Corp's TV revenue from races is shared with competitors how? The IAAF's TV revenue from the Diamond League is shared with competitors how? FINA's revenue from its World Championships is shared with competitors how?NFL has package deals with several networks and the revenue to shared with all the teams. NBA, MLB, NHL have national TV deals which are revenue is shared with all the teams.
A lot of people looking at cycling suffer from a kind of body dysmorphia. They imagine there is something wrong because they think cycling doesn't look like something else. Generally speaking, these people are comparing cycling with the wrong thing. Cycling is not like NFL. It is not like the EFL. It is not like F1. It is like cycling.In each of these cases teams then can get local TV and radio deals that are excluse to the team. So please explain where the cycling teams are getting TV (or even radio) money from.
One can only assume a lack of familiarity with the websites of the main teams when one hears that comment. Most teams sell branded tat. Sky, they had books published in 2012 and 2013, just like Garmin's 2012 Argyle Armada, or DQS's current Wolfpack book. Via Sky, we have some insight into the way revenue from replica jerseys works, with Rapha's Simon Mottram having told us that a percentage of revenue from every bit of Sky-branded tat sold by his company made its way back to the team during the period of their deal.Again, the big thing most of these teams (for some unknown reason) are missing is merchandising.
Again, this displays a lack of knowledge of the workings of the sport. Image rights are a major part of rider contracts. In fact, image rights are so major that they are most famous for the way they are used as a tax dodge.What even Quickstep is still missing is putting riders names/likenesses on merchandise and then giving the riders a portion of the proceeds of anything sold with their name/likeness on it.