The price of F1’s US success

Pity the sports industry practitioner who books holidays in August. They’ll have catching up to do, whether that’s keeping up with the latest twists as broadcasting adapts to streaming or just the idiosyncrasies of the football transfer window.

Subject to much discussion is Chelsea FC, owned by US investors Clearlake Capital and Todd Boehly after a £2.5bn takeover in 2022, and the club’s seemingly bloated squad. The sports press are actively asking, “do Chelsea have a plan?” New men’s head coach Enzo Maresca is under pressure to deliver after two years of mediocre performances. So how does he deal with all those players?

“At the moment, with the squad that we have, I am working with 22, 23 or 21 players — not with the 42 players, otherwise it is impossible,” Maresca said this week.

This week we look into the antitrust investigation looming over Formula One, the relationship between football and gambling, and more. Do read on — Samuel Agini, sports business correspondent

Antitrust investigation hangs over F1

Formula One is back. The season break is over and racing teams are gearing up for the Dutch Grand Prix on Sunday, but troubles are brewing off the track, far away in the US, where antitrust authorities are investigating

Since acquiring F1 in an $8bn deal in 2017, Liberty Media, the US group chaired by billionaire John Malone, has elevated the sport’s profile by focusing on personalities rather than just the technical aspects of racing, notably through Netflix’s Drive to Survive series.

As readers of Scoreboard know, those efforts have paid off handsomely in the US, a country where F1 long struggled to gain traction.

These days, American celebrities flock to grand prix races not only in Austin, but in Miami and Las Vegas too. Advised by Lewis Hamilton and backed by Apple, Brad Pitt is starring in an upcoming F1 film. US sponsors, from Google to Goldman Sachs, have flocked to the sport.

But one American wasn’t welcomed with open arms. Michael Andretti, a member of the US racing dynasty, was rejected by F1 in January after applying to add a new team to the grid. Andretti, whose father won the F1 championship, is backed by Guggenheim Partners chief Mark Walter’s Group 1001 and had already met “stringent criteria” set by the Fédération Internationale de l’Automobile, which governs the sport.

“Our assessment process has established that the presence of an 11th team would not, in and of itself, provide value to the Championship,” F1 said in January. “The most significant way in which a new entrant would bring value is by being competitive. We do not believe that the applicant would be a competitive participant.”

Some existing F1 teams have concerns about the financial impact of splitting revenues with an 11th member of the grid. One argument is that Andretti should just buy an existing team so as not to dilute revenues, while F1 has left the door open for an entry in 2028 rather than 2026.

But scrutiny has ramped up. Earlier this month, Liberty Media disclosed that the US Department of Justice’s antitrust division is investigating “Formula 1’s conduct concerning the application by Andretti Formula Racing to enter the FIA Formula One World Championship”.

“We intend to fully co-operate with this investigation, including any related requests for information”, Liberty Media chief Greg Maffei told analysts this month. “We believe our determination, F1’s determination, was in compliance with all applicable US antitrust laws, and we’ve detailed the rationale for our decision vis-à-vis Andretti in prior statements,” he said.

“We are certainly not against the idea that any expansion is wrong,” he said. “And we’re certainly open to new entrants making applications and potentially being approved if those requirements are met.”

Just a few years ago, F1 was fighting for attention in the US. Now, the sport’s owners might have a little too much.

Football’s enduring gambling addiction

It’s been just over a year since Premier League clubs agreed it was time to start phasing out gambling sponsors from the front of their team shirts — a decision taken to get ahead of possible legislation to ban it. Yet with the 2024/25 season now under way, it’s clear that football’s gambling addiction is not on the wane.

Of the 20 teams in England’s top flight this season, 11 have some sort of gambling company as their main sponsor, including two “crypto casinos” in Rollbit (Southampton) and BC. Game (Leicester City), and some without a UK website, such as BJ88 (Bournemouth) or Net88 (Crystal Palace), which are instead aimed at gamblers in Asia.

Such deals are usually hailed as “record-breaking” for the club when announced, but quickly attract criticism once fans (and journalists) start digging into the details.

These contracts — typically just a year or two long — point to a deeper issue. Despite being the most popular league in global football, only a handful of Premier League clubs have been able to attract the kind of big multinational sponsor that you might expect from a competition watched by millions of fans around the globe. On Sunday, Chelsea kicked off a second season running without any front of shirt sponsor.

Those working in the industry say football is too tribal for many big brands, who fear upsetting a potential customer base by being seen to choose sides.

Assuming clubs stick with their plans, clubs will still have a couple of years to find new partners away from the gambling industry. Betting firms will still be allowed on shirt sleeves too.

But in a sign of how ingrained betting has become in the ecosystem, Uefa, which governs the sport in Europe, this week announced it had signed Bet365 as a new global partner for the Champions League.

Uefa said: “Bet365 is dedicated to enhancing the excitement of sport while promoting responsible sports betting practices. We look forward to a successful partnership that not only elevates the experience for our fans but also supports efforts to protect the integrity of the sport.”

Those not keen on gambling sponsorships might look enviously at newly-promoted Ipswich Town. The Suffolk-based club, now owned by a group of US investors, has been able to rely on a passionate fan as its main sponsor: a local singer by the name of Ed Sheeran.

Sheeran, who bought a 1.4 per cent stake in the club last week, will miss the Tractor Boys’ game against champions Manchester City today as his Mathematics Tour lands in Bucharest.

Highlights

• Portuguese footballer Cristiano Ronaldo, the most followed man on Instagram and Facebook, has launched his own chat show on YouTube, called UR. Within 24 hours, the channel already had close to 20mn subscribers.

• US businessman John Textor is seeking to sell his minority shareholding in Crystal Palace as he pursues his interest in Everton FC, which is owned by British-Iranian owner Farhad Moshiri. The stakes are high for Everton, following the collapse of a sale to AS Roma owner Dan Friedkin. Textor explains here.

• The National Football League held further talks to allow institutional investors to buy stakes in franchises, according to Sportico, as rising valuations make it harder for even the richest individuals to produce the cash to fund takeovers on their own.

• Liberty Media said it is raising $825mn to help fund the acquisition of Dorna Sports, which owns motorcycle racing series MotoGP, in a deal valuing the business at €4.2bn including debt.

• The bidding for Paramount, which broadcasts everything from the Uefa Champions League to NFL, took another interesting turn. There’s no time to rest in broadcasting, where shockwaves are still reverberating from a key legal injunction and some are wondering what the breakdown of cable means for sport.

Final Whistle

The late stages of the summer transfer window usually provide a rich seam of online video silliness as social media teams get creative. Burnley’s Lord of the Rings-themed unveiling of new defender Bashir Humphreys is a good example.

But sometimes real life provides the greatest theatre. How about motorbikes, fireworks, light shows and a quick dose of holiday Spanish? Conor Gallagher’s arrival at Atlético Madrid has it all.