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How Formula One Actually Works: A Guide For Confused Americans

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Cricket is considered to be the most impenetrable game for non-Englishmen to comprehend. Being English I cannot understand why foreigners might struggle to grasp the appeal of sitting on a wooden bench and watching 22 men occasionally move on-and-off a large field for five days, but believe me when I tell you that a cogent explanation of the rules of cricket is the matter of a few moments compared to an understanding of Formula One.

So here, my American friends, is how Formula One works. Well, here’s how I see it working.


At the outset, we need to refine the nomenclature of F1 – Formula One is not a sport, it is a business. To be a sport it would need to be wholly owned by a business or parent company that existed purely, or at least in the most part to act in the interests of the sport itself and the teams themselves. That is not the case in Formula One. Formula One is owned by a company called CVC, a company that reports to shareholders and whose duty it is to return as much profit to those shareholders as possible.

Bernie bought 100 years rights for about $300 million, which to build a simplistic corporate analogy is like walking into a Chevy showroom and not only offering $25 for a new Camaro Z28, but sealing the deal, too.

Most sports are owned by some organisation or promoter, many have shareholders, and most retain a good percentage of the profits generated by the activities of the ‘sport’ they own, but few retain the same percentage of those profits as CVC.


CVC purchased the F1 business from a man called Bernie Ecclestone – you might have heard of him. He’s a small, approximately 300-year-old dude with deal-making skills that could have ended the Cold War in two hours and a dollop of Beef Stroganof. How did he manage to sell a sport? Because he had bought the rights to televise the sport – back then a very large percentage of the revenue the sport could generate – from motorsport’s global governing body, the FIA. The FIA has no jurisdiction in the USA, a fact that should make you ever prouder come the 4th July.

Now as luck would have it, back in 2000 the chap selling the TV rights to Formula One was one of Bernie’s good pals, Max Mosley, a man who, in 2008, perfectly defined the difference in meaning between the words famous and infamous. Bernie bought 100 years rights for about $300 million, which to build a simplistic corporate analogy is like walking into a Chevy showroom and not only offering $25 for a new Camaro Z28, but sealing the deal, too.

Given that he already owned Formula One Management, the company that negotiated the deals with all the circuits on the calendar, and the advertising real-estate and the ability to sell corporate hospitality, and the logistics business that ships all the F1 clutter around the globe, you can understand why he managed to accrue a few pennies.

He reached this unassailable position by manipulating and playing the characters and egos of the established team-leaders in the ‘sport’. As they failed to separate on-track rivalry with the collective need to protect the business of Formula One, and their ownership of it, Bernie ran rings around them. To read how, I suggest you buy a copy of "Bernie's Game" by Terry Lovell.


I love Formula One. I love that its ownership is utterly nonsensical and that pretty much everything it does defies logic and convention.

With the business now under his control, Bernie sold it to the highest bidder – CVC Partners in 2005. And Formula One was now owned by a bunch of bankers who needed to justify the purchase price, and who probably would have liked to sideline Bernie, but who realized that the benign dictatorship he presided over could only be run by one man, you guessed it – Bernie Ecclestone.


So Formula One is a business that operates a sporting activity that generates $1.8 billion of revenue, but which only redistributes abouf half back into the teams each year. It is wholly owned by shareholders who employ Bernie to do their bidding, only in reality they have as much control over him as the man who watches his young dog feverishy, deafly chasing sheep and implores him to stop: ‘Stop!! Bernie stop!! FUCKING STOP!!”

The common presentation of this strange situation is one of the evil corporate colossus leeching Hemingway’s ‘true sport’ of money, and leaving it in a parlous state. There’s some truth in that, but it neatly avoids the fact that for the best part of 30 years the team owners and principles have always been unable to agree on anything. As Bernie likes to say when the media collars him after another team bosses pow-wow and asks what was agreed “We didn’t manage to agree when to hold the next meeting” while normally suppressing an impish grin. Bernie has made billions feeding on instability.


So when Lewis Hamilton finishes fifth and still fails to win the 2014 World Championship because of a slow pit stop, despite being 17 points ahead going into the final round, that is the corporate background. That is why F1 is what it is.

This is a business that for 2014 decided to award double points for the final round of the championship, either to keep matters spicy until the denouement, or to charge Abu Dhabi more cash to host a double-pointer, depending on your level of cynicism. None of us fans can understand why. Most of the people in F1 hate the idea. But it’s happening anyway.


This is a business that, against the will of the teams and many spectators decided to introduce small capacity turbocharged engines and hybridity to align itself more closely with the industry that supports it, and you know what, anyone that doesn’t like it can go fuck themselves.

Remember: if Bill Gates ran a brothel, it would be a shit brothel. We don’t need nice – nice doesn’t win

Formula One in 2014 rocks. Turbos, oversteer, technology, stunning driving talent.


So enough with the explanation already.

I love Formula One. I love that its ownership is utterly nonsensical and that pretty much everything it does defies logic and convention. I love that it is still bossed by an octogenarian dwarf who tinkers with it like an especially skanky model railway. Formula One – the concept of spending inordinate, deeply offensive amounts of money on crazy fast cars – is inherently the most ridiculous sport on the planet and it naturally attracts people whose ridiculousness defies even the skills of the greatest Hollywood scriptwriters, and as such it absolutely deserves – no, make that needs the most obviously fucked-up, opaque, dodgy, mercenary, undemocratic bunch of rules and leaders imaginable. This is North Korea with 750hp.


Remember: if Bill Gates ran a brothel, it would be a shit brothel. We don’t need nice – nice doesn’t win. Ethics and motorsport don’t matter to each other; don’t exist to each other.

Do any of the vanilla media pricks who whinge about Bernie and his machinations ever stop to imagine how dull their column inches would be if Formula One was run by some ethical non-profit-making organization that reinvested the majority of revenues in the sport and the remainder in Eastern European orphanages? Nope. Do they hassle the main news desk with copy offers when it emerges that Bernie has effectively paid a bribe to buy his way out of a German bribery case? Guess the answer.


F1 is a villainous activity. It is the pinnacle of a pastime best defined by Mark Donohue as ‘the unfair advantage.’ Hemingway was right to eulogise it as one of the few genuine sports, but was wrong to romanticize its nobility. For motorsport, and most notably F1, is the apotheosis of selfishness. It is a journey to win at all costs: to circumnavigate, obfuscate, deceive and ultimately prevail. Like the shrew-wife stuck with the bully husband, the rank venality of Formula One fully deserves the business that owns it. And it will always be a fucked-up place.

The lesser teams will always have too little money. The wrong people will always be in power, the big-dogs will always threaten to leave and fail to do so, the naysayers will always wrongly assume the past was better and, until he casts off his mortal coil, Bernie will still rule the roost. And I will still be enthralled by the nonsense, the chutzpah, the precocious skills of the great drivers, the effrontery of the talentless berks in the paddock and the absurdity of the travelling circus that is Formula One.


Come to think of it, I can’t explain Formula One, what madness made me assume I could! I remain unconvinced it is unexplainable: F1 is part metaphor for the human condition; part theatre for yesterday’s capitalism. Lost in translation, lost in itself. Perfectly funked-up.

Watch the race this weekend and you’ll see why.

Postscript: In the game of cricket, a ball that moves from off to leg stump, that is left-to-right on the field of play, when delivered through the front of the hand is called an off-spinner. When delivered from the back of the hand, through a cocked-wrist, it is called a googly. As a batsman, spotting a googly should therefore be easy, but the best bowlers disguise it well.


Illustration by Sam Wooley