The pain in Spain

Thursday, 26 January 2012

The Spanish economy is set to shrink this year, continuing the funk it has been in since 2009. Unemployment is over 20% and climbing. Set against it’s no wonder that several races are under threat in Spain.

Pro cycling depends on government funding and corporate budgets and across Europe times are tough. But not for all.

Only this week we get news of two races in trouble. First Biciclismo brought us news of the Vuelta a Castilla y León in April being shortened to three days. Race organiser José Luis López Cerrón – coincidentally the man who apparently brought clenbuterol-laced meat to Alberto Contador in July 2010 – said that the recession is biting and that both municipal budget cuts and uncertainty over the contribution from Caja España, a bank that sponsors the race, is leading to the cuts. Second the GP Miguel Indurain is also under threat, the same budget shortfalls mean the race is in in peril and this time, since it’s a one day race, its future is in doubt. Once a race drops off the calendar, resurrecting it is  hard.

And this is just the bad news this week. Last year the Vuelta a la Comunidad Valenciana vanished for good and more recently the 2012 editions of the Majorca Challenge and the Vuelta a Murcia have been cut by a day to save costs. Plus there’s uncertainty over the Euskaltel-Euskadi team, it looks set to continue but nothing is signed for now.

One effect of this could be more cycling, or at least more cyclists. If headline unemployment is over 20%, youth unemployment in Spain is 49.6%. I can’t help wonder if a lot of young people will have more time to ride. Racing, with prize money and possibly a contract, becomes even more attractive. A wider pool of riders means more world class riders come through; then again detection and coaching is often the product of big money too, see the well-funded systems in Britain or Australia.

Beyond the Pyrenees
This slump isn’t unique to Spain but the country stands out because, unlike Greece, cycling is substantial sport. Other countries in Europe have their problems, this morning’s newspaper headlines in France cover the record levels of unemployment announced yesterday. In response President Sarkozy is rumoured to be considering a significant tax change, raising sales tax in exchange for a cut in the payroll taxes. You might not care about French tax rates but high payroll taxes affect cycling because French teams struggle to recruit big name riders in part because tax makes this more expensive.

Former Italian PM Prodi tackles an uphill task

Meanwhile Italy has replaced its entire government with unelected technocrats charged with saving the economy; the new premier Mario Monti is in fact a keen cyclist and can be spotted on the roads of Varese on a Sunday morning.

Some good news
It’s not all doom and gloom. The Polish economy enjoyed 4% growth last year, the likes of Quickstep and Liquigas have several Poles to help sell wooden flooring and gas back home; yesterday the Tour of Poland won an award as the country’s best sports event. The nearby Baltic states of Lithuania, Latvia and Estonia are bouncing back after a deep slump. Switzerland is doing ok and its currency is as solid as ever, good news if you’re a UCI official on a Swiss salary; bad news if you’re a rider or team fined in Swiss francs. Belgium grew ok in 2011 despite not having a government in place for most of the year, new races are appearing and semi-classics are stepping up to the Pro Tour calendar.

Summary
Many European countries are caught in a prolonged economic slump. Pro cycling does not exist in a bubble, it is dependent on state and corporate spending and shrinking budgets bring cuts to the calendar and more. Spain stands out with several races under threat but this is true in other countries.

It’s not all bad news, even in Europe new races are appearing and the sport is spreading around the world. And if the bad news is too much for you, life goes on. Even on a reduced basis there is still a lot of racing in Spain.

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{ 21 comments }

Feargal January 26, 2012 at 1:31 pm

“Pro cycling does not exist in a bubble, it is dependent on state and corporate spending and shrinking budgets”
This is true, so can someone tell me why as team sponsor I would want to put money into a team when race organisers can’t be bothered (or required) to sell their TV rights to broadcasters who have a cycling pedigree.

Ankush January 26, 2012 at 2:25 pm

I sometimes wonder how many languages you know.

It’s sad to see the smaller races getting affected in wake of the economic slump. Over the top of my head, I could suggest that the race organizer should somehow manage to provide a livefeed which could then be sold online at a reasonable rate 1-5 EUR (depending on the race duration). Also charging nominal amount at the finish line could help, I’m sure locals would love to keep the race on calendar. Cycling has now become a global sport and the small race organizers should tap into the global audience by going online.

Touriste-Routier January 26, 2012 at 2:49 pm

Not all race organizers get paid by broadcasters for TV rights. Some races that get TV coverage actually pay for at least the production cost, if not the airtime as well, unless they can help find adequate commercial sponsors. Those that do pay for coverage do so to improve exposure for their race sponsors.

As you can imagine, video production expenses for cycling do not come inexpensively; one needs multiple camera crews on motorcycles for ground shots, at least 1 helicopter for aerial coverage, and often a second aircraft (helicopter or airplane) for satellite communication. If the weather is adverse, the aircraft may not be able to fly, causing major broadcast headaches, but you’ve already reserved & paid for their time. Then there are the various “mobile studio” costs (producers, directors, on-air talent, etc.) that it takes to produce any broadcast show. These all add up to costs in the tens of thousands.

Thus a race that is already struggling due to lack of government or sponsor support, may not have the means or cash flow to produce a broadcast, whether over the airways or over the internet. It really comes down to perceived return on investment, and whether it is worth the gamble.

While some of us might be willing to pay for live or on demand streaming race coverage, it would be interesting to know what the real market potential is for this.

The Inner Ring January 26, 2012 at 2:57 pm

Ankush: I can survive in a few languages but online translation tools are very useful.

Touriste-Routier: it can cost €80,000 a day for a race organiser to pay for the broadcast. There’s the production crew, the satellite uplink bandwidth, the equipment rental, helicopter use and more like you say. Organisers pay for this to ensure the teams come and the TV images bring sponsors to the race.

Feargal January 26, 2012 at 4:01 pm

Regarding TV rights my comments were primarily directed to Pro Tour events, and one in particular.
Having been involved in negotiation on the very matter a few times I do understand about the costs involved in broadcast coverage of sport.
However there are ways for smaller race organisers to cover (in part if not all) the costs of broadcast.
The Tour of Poland being one clear example of sticking the TV camera on almost every advertising banner and hot air ballons in the last 30km, for sure those who banners and ballons appeared on TV paid a premium for the per second on air exposure they got, there are other ways too, we have to think fresh, as Inner said, cycling does not live in a bubble.

Larry T. January 26, 2012 at 4:11 pm

I think in addition to the economic woes, Spain might finally be reaping what they’ve been sowing for so many years with the cycling federation’s failure to properly sanction dopers. Italy’s going through it as well (though they’re further along than the Spaniards) after too many years of failing to come to grips with the problem. I’m amazed these days at how many Italians tell me they no longer pay any attention to cycling – “they all dope” is what they tell me. As for paying to have races broadcast on TV I remember the Trump/DuPont folks back-in-the-day having to pay, not to mention produce the TV package to get it on the air. All the talk about all this revenue out there to support a North American pro sports style cycling league makes me laugh – where is all this money going to come from? It’s widely known the Giro doesn’t make any money despite being the second biggest race in the world. Somehow I doubt the team managers promoting this idea would be happy with a draft system for new riders either – taking away the advantage of big pockets to attract the best talent, though that’s an integral part of most of the sports leagues they claim to want to emulate. The idea of poor folks taking up cycling to make a euro or two is quaint, but has there ever been a time when equipment has been more expensive? Buying a bike good enough to race on and win some prize money would pay for a LOT of loaves of bread!

MT Dave January 26, 2012 at 4:17 pm

Inrng does not translate words, they translate to inrng.

Igor January 26, 2012 at 4:41 pm

On the picture it isn’t Mario Monti cycling but Romano Prodi, also an ex-italian premier and as Monti a Goldman S(u)achs guy ;-)

The Inner Ring January 26, 2012 at 5:44 pm

Igor: you’re quite right, it is Prodi, I found it inside an article about Monti cycling. Former PM Prodi is a keen cyclist as well. In fact he’d use cycling metaphors in speeches all the time (“we have a long road to climb”, “there are headwinds”, “Italy is in the lead peloton of industrial production”, that kind of thing).

El Gato de La Cala January 26, 2012 at 8:45 pm

I have been quiet for while, but living in the southern part of Spain I feel obliged to comment on the present situation in Spain, professionally cycling vs. economies, as seen from the streets – not from online or printed medias.

1) Race organizers are struggling mostly due to lack of sponsorship money available. Spain definitely is in crisis. (Note that there are two kind of more than less official money in Spain: A-money which is defined by having been taxed and B-money which are not and are now estimated to sum up app 26 billion € in Spain.)

2) However, the new government has targeted tax fraud and corruption throughout the public and the private sector and this has tightened up the space for bike race organizers or organizers of other sporting or cultural events. It is a well known joke that even the king could get away with murder in Spain – but it seems that these days of anarchy and corrupt behavior is over. At least for the time being. So maybe it is just not worth running sporting events any longer for the former event makers – now being monitored closely and having to put a accounting together and send it to somebody in Madrid. Even contributors and sponsors are not able to make any money laundry deals through events anymore as they are also “hunted animals” by the authorities.

So shortening stage races from six to three stages is not due to lack of money but due to now paying tax!

3) Doping and the negative media coverage is not the reason! In a country where law says that all citizens in a major city should have access to a “Farmacia” within 600 meters from their homes, painkillers and pharmaceutical shortcuts is as integrated as amen in a church. You won’t believe the range of stuff for sale with our prescription. So taking a little chemical help to get through life in general or to survive tuff bike races is not considered a cheat. It is considered like using a tee when playing golf. Take all the help you can get!

4) The culture. Riding your bike in Spain is even more pleasant and challenging than in many other parts of the world. Young or old, you see people riding their bikes during the siesta, early in the morning and coming back from the mountains in the twilight. Pro races or no pro races – as for Spanish amateur bike riders they simply don’t care. Geographic, Spain is a huge country, and bike clubs seems to be run local and everything outside their region is considered abroad. Most Spanish people haven’t even been outside Spain, or their village, so why should care about what is going on outside Spain.

All in all Spain has to grow up and adapt to and live up to the European standards in terms of corruption and paying tax – to be taken serious in the future and this is the biggest challenge in the country at the moment.

Like my neighbor (mid thirty and trained engineer) says with a big smile and wide open and innocent eyes, when briefly discussing the matter and sharing two ice cold San Miguel beers in his garden just a few hours ago, while enjoying the early spring and the warm sun: “NUNCA VA A PASAR! (It will never happen!)

MavicMoto January 26, 2012 at 11:40 pm

Thank you El Gato.
That was lovely, very helpful for the rest of us.

Jon Eberly January 27, 2012 at 12:39 am

We got to spend two weeks in Anadalucia this past fall, what a great place filled with history. Did not get to ride (the wife would have frowned upon me disappearing all morning) but the level of participation puts France to shame. Like El Gato said, everywhere we travelled there were riders from Cat1s down to Sunday afternoon cruisers out on their bikes. Favorite memory was stopping for lunch in Coripe, which is on an old converted rail bed now used by walkers and trail riders. While having lunch three guys leave the families outside to play while they hit the bar. They were all kitted up and looking very serious about riding, except for the triple gin fizzes they were knocking back. How do I join your cycling club?

CAT4Fodder January 27, 2012 at 7:07 am

Wait – you mean Spain is not planning on fixing this by building a colony on the moon? Oh no, they are doomed!

BD. January 27, 2012 at 8:01 am

It may seem Belgian race organisers are booming but in youth ranks it’s not all that good. A lot of races disappear due to older boards. A lot of young people don’t want to put time into volunteer work, they all want to ride their bike themselves or set up new cycling teams (a lot of traditional teams who have riders in all youth ranks have difficulties to compete with new “semi-pro” teams that focus on one youth category).
This might be an issue and a challenge for the future.

But I guess Belgium’s quite spoiled if you compare with other countries regarding the number of race organisers.

Feargal January 27, 2012 at 10:03 am

El-Gato, great summary, thanks.

TotheBillyoh January 27, 2012 at 1:57 pm

El Gato – Excellent, thanks.

The UCI should have bigger fish to fry. There are millions of ‘consumers’ not living in Europe. Nigeria: 158 million; India: 1,170 million; China 1,338 million. Quite a few of them watch TV. And buy stuff.

Bundle January 27, 2012 at 2:24 pm

Well, in the 1970s and 1980s, Spain had its usual 20% unemployment, per capita wealth was half the French level, and well below Italy’s, and there were plenty of races, that depended largely on commercial sponsoring. Now Spain’s relative wealth is above the Italian level and not far from the French.
The problem, in Spain as elsewhere, is twofold: sponsoring has become much more expensive than it used to and should, and (especially during the Armstrong and doping scandal years) audiences and TVs have been turning their backs on cycling. Thus making the sport largely dependent on governmental sponsoring. This had to end, as it was not sustainable. And sponsoring teams and organizing races should become much cheaper. And the sport has to become more attractive. I personally think that the introduction of the helmet was crucial in depleting cycling’s fan-base, because it considerably deprived the experience of watching a race of its empathetic, emotional element. When the spectator cannot easily identify the riders’ heads, because the cyclists all look the same with their helmets and sunglasses, he’ll turn to the remote.

Larry T. January 27, 2012 at 4:25 pm

You’ve pointed out something interesting Bundle! I too wonder about the helmet/sunglass issue but have been hesitant to point it out for fear of being called anti-helmet or anti-safety. But for those of us old enough to remember watching cycling on TV when it was MUCH easier to tell the riders apart, that may be an issue for TV viewing. Putting the guy’s name on the back or side of the jersey may be an excellent idea as some are already doing it and others (Mercatone Uno) have done it in the past.

bikecellar January 27, 2012 at 10:20 pm

Good point about the helmets/sunglasses, but we have to live with it, I have found that I can now recognise most riders by means other than facial recognition. Personally I don’t ride without helmet or glasses ,ever, having suffered with conjunctivitis and cracked a couple of helmets. I won’t go back to the days of my youth, (wind in the hair etc) supposing I had much hair that is :)

cthulhu January 27, 2012 at 11:07 pm

Do you really think riders are more recognisable witout helmets?

I mean did you recognise every rider back then and not only the star riders? Maybe it’s just me, but I recognise the riders from things like their figure, their pedaling style and their team kit. And the ones I don’t recognise, I wouldn’t recognise even if I could see their faces. But then again I don’t have the comparison.

Bundle January 27, 2012 at 11:34 pm

I still remember even my grandma being able to cheer “the bald guy”, “the blond one” or “frog-face”, without caring to know their names, when we were watching the TdF in the old days. Wnd what’s valid for a grandmother is even more so for a little child who watches for the first time. Even an ugly-faced, clumsy-pedalling guy like Robert Alban could be charismatic. We have to think that potential large audiences are not people who ride every week and know Sram from Campagnolo.
On the helmet issue, I think it should be up to the rider. It’s his body and no one else’s. (Which I say still recovering from crash-derived surgery).

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