Some thoughts on Vaughters’ licence proposals

Friday, 10 December 2010

Jonathan Vaughters has written a must-read article over at cyclingnews.com. He takes a look at the worries concerning Geox, where their exclusion from the new UCI World Tour has led to boardroom discussions on whether to continue with sponsorship. It’s a similar point to the one made by Gerard Vroomen just a few days ago, although Vroomen says the harmony is coincidental.

Underneath the tartan and argyll lurks a pin-stripe business brain

Vaughters is dead right when he points out the view from a sponsor: cycling can offer huge returns in airtime and newspaper coverage. But companies hate risk and if they can overcome the fear of doping scandals then committing to spend millions on a cycling team only works if there’s a minimum guarantee of coverage. In short, teams want to know if they will qualify for the Tour de France.

Race organisers have a slightly different perspective. They want the best riders in attendance but they also want to retain some control over who turns up. For example ASO has given wildcards to the likes of Cervélo and Team BMC, in order to ensure the likes of Hushovd, Sastre and Evans take part. Plus race organisers want to ensure local flavour, the Giro needs Italian teams.

But Vaughters goes a step further, calling for licences, essentially franchises, to be issued to teams:

Maybe instead of 15 teams fighting on a year-to-year basis, 15 teams are given a 10-year contract with all the top events, based on their history, performances, and ethical foundation and then the remaining 5-7 teams are invited as new comers and potential league members after the 10 years is up.

It’s here that I think things get harder. Giving some teams the incumbent right to sit on a licence for a decade entrenches established teams at the expense of others. Remember the Pro Tour gave Mauro Gianetti a licence, this was tarnished following the ejection of Ricco from the 2008 Tour de France but Gianetti kept the licence and the Fuji and Footon team got invites to the big races but could not deliver.

For me it’s all about who gets the risk. Right now teams and especially sponsors share a large burden here, they have to worry invitation to major races. Meanwhile race organisers have been able to cherry-pick their favourite squads, whether in terms of sporting performance, national colours or ethical standards. Move to a franchise system with 10 year licences and the risk teams lose risk but the concern then is that a team and its manager can sit on the licence. Especially for a smaller team there’s little point aiming to win the GC, it can just aim to grab airtime via breakaways.

In fact this is what we already have with the French teams, the likes of Cofidis and Bbox have been guaranteed a ride in the Tour de France because of the need to have French teams taking part. It works for a few teams but I’m not so sure about several teams.


Interim solution
I think Vaughters ideas have a lot of merit and require wider discussion. But it’s a real Pandora’s Box, the money involved in these franchises could be significant and the risk here is that the sums involved distort behaviour. It’s also up against other ideas, for example the concept of a full cycling tour with universal TV rights, a project that would bring significant windfalls to the owner of the concept. That’s something a couple of private equity houses know intimately.

So I’d propose an interim solution. We keep the system of guaranteed entry plus five wildcards for the Tour and other races. But the rankings should be based on a team’s position at an earlier point in the season, for example June. This allows a team the element of stability, they can sign riders in the second half of the season but it won’t change the rankings.

The second fundamental point has to be a block on sudden rule changes. By all means change the rules over time but give plenty of advance notice, for example if race organisers meet with the UCI, any significant changes should be implemented in 2013 or 2014.

And the riders?
Another issue is the riders. If Vaughters wants teams to link up with the UCI and organisers like ASO and RCS, then there are two other groups missing. First up, the broadcasters as they pump millions into cycling via TV rights but they tend to work direct with race organisers. More importantly there’s not much discussion with the pro riders. For me I’d think about balloting every World Tour rider to get rider approval on significant rule changes.


Dilution is the solution
One final point. Right now the race organisers are in a relatively powerful position, this has been so since L’Equipe created the Tour de France. The UCI needs to exist to draft the rules and enforce them, but I’m wary when it tries to go beyond this I get wary. Sponsors can come and go, and whilst the sport has always been dependent on corporate funding, extending this is a concern. Similarly can we sell the right to the big races to every team for a decade?

For me, it helps to have the power divided up amongst these, at times, chaotic groups. Big changes might reward some… but at the expense of others. Right now it’s useful to ensure no one group is able to call the shots. Giving everyone a slice of the pie works, the real problem is that some seek to change the recipe after the chef has bought the ingredients.


Summary
I really like what Vaughters and Vroomen have to say. They make articulate and sensible points. But I’m more with Vroomen when he says the pressing need is to stop making sudden changes to the rules. Vaughters is raising some really important long term issues but they are complicated and the execution carries risk. Simply stopping last-minute stitch ups from the UCI and others is easy and achievable, moving to a new model of team licencing is a massive step, perhaps a leap into the dark. It is worth exploring this, but without rushing. This isn’t to say the idea is out of reach, more that we can fix the easy things first.

Photo: MarcoQuezada.com/NYVelocity

Pin It

{ 14 comments }

Anonymous December 10, 2010 at 11:38 am

Some good points. I don't think we can move to big ideas like awarding long term deals until the simple things get fixed.

But it's good to hear JV coming up with ideas for the future. At least someone has a vision for the future.

Anonymous December 10, 2010 at 2:24 pm

Surely as a DS Vaughters would ask for a permanent licence. It is in his interest. But not for everyone else.

Alex Murray December 10, 2010 at 3:46 pm

I think what's worth investigating is where Vaughters and Vroomen are coming from culturally. They've grown up in the North American model where all the successful sports (NHL, NFL, NBL,MLB) are based on rigorously structured franchise systems with proper guarantees on funding, player selection structures, wage caps and a more open point of entry into the top tier.

In that model the UCI would be an effective rules committee that does the checks on the propriety of potential owners.

As it stands, all it would take for us to see a situation that cuts the UCI totally from the deal is for ASO and RCS to agree to work together in the same way that AFL and NFL do in American Football. Why they've never seized this opportunity I will never know.

TheInnerRing December 10, 2010 at 3:46 pm

Anonymous 1: yes, the vision thing is good. I particularly like the way he can express his ideas so well in cyclingnews.

Anonymous 2: true, he is talking his book but I don't see him pushing or this so aggressively, he seems to express a more genuine concern. Others in the sport have made more naked pitches to "grab" parts of the sport but it hasn't worked.

Neil December 10, 2010 at 5:03 pm

They could use a football (soccer) league system with promotion and relegation between pro tour, pro conti and conti level. Survival of the fittest! It would definitely make the end of the season more exciting with relegation and promotion battles.

It would also stop something like the Saxo-Luxembourg exodus. Depends on your views as to whether that was a good or bad thing.

TheInnerRing December 10, 2010 at 5:07 pm

Alex, yes that was exactly what I was thinking. I'm going to take a look at the franchise-based sports model and see what be applied.

As ever sport is a dream world for some, some of the biggest teams in the sport exist because of a "sugar daddy" or someone taking a personal decision to fund a team.

Neil: the UCI is trying that with the "sporting aspect", only the rankings are not clear and teams tend to recruit in July but the season calculations are made on rankings in October. It's complicated.

Neil December 10, 2010 at 5:33 pm

Yes but they include all the teams in the same league then pick the top 15. I'm talking about having distinct leagues with maybe 3 promotions and 3 relegations.

I'm not convinced this would work but they could run the leagues with the last day of the tour being the finish of the league/season. That way on August 1st you know the 15 teams that have a world tour license for the next year and riders/sponsors can make far more informed choices about who to sign with for the following season.

If a team folds then you just run the season with the 14 left. If a team gets too many doping violations, relegate them down to conti level along with all the riders for the rest of the season.

It might make it a bit more interesting as at the moment I only care about the riders and don't support any one particular team.

Alex Murray December 10, 2010 at 6:08 pm

Take a look at John W Henry's involvement in sports franchises as an example.

When he bought the Marlins they were a low budget club and when he sold them they still were. Yet he's also been involved in big spenders like Yankees and Red Sox. It's very interesting to see how the money moves about in that League and how MLB is a powerful enough broker to offer no interest loans to help keep the franchise system working.

TheInnerRing December 10, 2010 at 6:18 pm

Neil: what would you do about the wildcards? For me it is important to have a certain number of French teams in the Tour, Italians in the Giro etc. But also to let organisers pick exciting teams, eg Cervélo or BMC this year.

Alex: thanks, I will.

Don December 10, 2010 at 6:50 pm

I agree with Alex but with one difference – ulimately the team owners don't really need the race organizers. The team owners could put on their own events. The existing event owners would then counter by trying to set up their own teams, but I think its easier for teams to learn how to put on events, than for events to learn how to establish teams.

If the top 150 riders in the world were competing in a new 3 week event called the France Championship, I think the fans wouldn't care what its called, and the money will follow the fans.

However, I don't think it will ever come to this point – I think the race organizers and team owners will eventually settle on a partnership of some sort as JV describes. And they will both marginalize the UCI.

Anonymous December 11, 2010 at 9:19 am

tIR: That league system Neil suggested wouldn't bear that problem imo. Wild cards could still be allowed. But the mandatory races are the only races that would count for your points. From that point of view I see no problem. My concern would be if a team doesn't want to promote because it doesn't want to pay the extra cash for the higher license for example.

But I'm on your when you say the system needs the little fixes and quickly. I like the idea of counting score after the Tour for the next season since there is a kind of summer break in cycling and the following races count for the next season. And I personally think the points should go to the team and not be taken with a rider when he changes teams.

TheInnerRing December 11, 2010 at 12:36 pm

Don: no way. The Tour de France effectively has a monopoly and creating a rival is almost impossible.

Interesting point on the UCI and one raised by Alex too: it could be squeezed out pretty easily. For me this is why I like it in charge of the rules and not too much more. The Pro Tour was a grab too far and some believe it was a first step towards the TV rights too.

Don December 11, 2010 at 11:19 pm

It is hard to imagine a competing 3 week race in France or elsewhere, but the riders contracts are with the teams, not ASO. If the teams decided to put on their own 3 week race in France during the same 3 weeks as Le Tour, which one would you watch on TV or go see? The one with the 150 best riders, or the one without?

I completely agree with you though- very unlikely to happen, but I think – unless I'm missing something – technically possible? Something the teams could use as leverage over ASO if they ever banded together?

Champs December 12, 2010 at 9:01 pm

I say it's unbecoming of a sponsor to even talk about pulling out.

Some teams absolutely do sit on their top-level license, and it would be good to see ProTour/ProTeam rolled into that Top 15 as a premiership with annual promotion and relegation. Rewarding performance alone just encourages cheating, so in this sport, team finances and ethics are part of the formula, and unfortunately, that's subjective. You saw the hurt feelings and accusations that grew out of this.

Comments on this entry are closed.

Previous post:

Next post: