UCI seeks new funding for its race promotion activities
Last year saw the Tour of Beijing run for the first time. A unique race, one major difference was they way it was organised and promoted. To summarise the UCI, cycling’s governing body, set up a corporate venture called Global Cycling Promotions (GCP) to run the race.
GCP caused all sorts conflicts of interest. Instead of governing the sport from above, the UCI became an economic agent alongside many it seeks to regulate. One minute the idea was to globalise the sport, the next it was to generate income for the UCI. Plus it turned out GCP was created after the UCI siphoned money paid into a fund in the name of the top teams to use as the businesses seed capital, a fact which irritated several squads.
Now the UCI is seeking to bolster GCP. It was been approaching various sources asking them to subscribe to the business in order to provide additional capital. A report by Bloomberg suggests the UCI has approached ASO, the company behind the Tour de France. Only ASO said non. As a result the UCI is pitching to wealthy individuals to see if they will invest. Bloomberg’s report is notable for four reasons:
- ASO said no. The Tour de France is the sport’s prime asset and the French company owns a series of other races in France and beyond. It is slowly sewing up the cycling calendar with deals from Qatar to Spain to California and has most recently inked a deal with Australia’s Tour Down Under. It even has a role in the Tour of Beijing.
- The UCI is trying to expand GCP. Personally I’m uncomfortable with the conflicts of interest here; especially since there don’t appear to be many measures to counter them… but that’s my problem. It’s obviously not worrying the UCI as it hunts for more resources. But it’s a sign that new races are coming. It’ll be interesting to see where they go on the calendar.
- Instead of bringing in revenue, the need for more money suggests race promotion isn’t – as yet – generating much income. Normally this should be a licence to print money since the UCI sets the rules of the sport. It can award coveted “World Tour” status to its own events at the stroke of a pen, thus guaranteeing the best teams and big name riders and all the status that goes with this. This ability to fast-track a race from nowhere to premium event – at least on paper – is not because cronyism but through genuine expertise (although the conflict of interest is substantial).
- One line quotes UCI President Pat McQuaid as saying “any UCI profits from the new races would be re-invested into the sport and distributed among teams” which is a new twist. It could be a way to entice teams back towards the UCI, after many have been evaluating a breakaway league.
Summary
It feels like the sport is up for sale. We’ve had tales of the Rothschild bank-backed breakaway league, now the UCI is after new funds.
We’ll see if the UCI gets the money. Private individuals are mentioned; I’m surprised sports agencies and others are not. An approach to Arnaud Lagardère could be interesting. I hope the dash for cash is not proving a distraction for top staff. We’ll have to wait for the next set of UCI financial reports due out in the autumn for some hard data.
For now this is a developing story. But as some work to reshape the sport, ASO’s rejection of a financial partnership with the UCI is a big move in the game. One to watch.
*IF* the money from the GCP events is indeed re-invested into the sport – and meaningfully, not using the Livestrong charity technique – then it isn’t a bad thing.
OTOH, if the UCI retains the profits, then it is extremely disturbing as the steps to generate profits will, over the course of any year, diverge from the steps to manage & maintain the integrity (inasmuch as I can use “integrity” and “UCI” in the same sentence with a straight face) of the sport.
Guadzilla: that’s a good point. We’ve seen the reason for GCP go from globalisation to making money for the UCI. Now it seems its going to the sport and the teams. It could be a move to placate the teams and make them think twice about breaking away… but the real money is the Tour de France TV rights. Like I say, a story to watch as the chess pieces are moved around. Note the UCI elects/relects its President later this year, something else to add to the mix.
Reinvestment in the sport must also be done in conjunction with our showcase events.
In England the “Play Rugby” campaign is in schools and the community all the time, but it is especially vocal and visual during the 6 Nations and World Cup.
The TdF is a time when reinvested cycling can be best spent in the community.
INRNG: “Follow the money”. All else is just noise.
I trust you will keep us well informed, as always.
Is there ANY viable alternative to Pat “Hot Air” McQuaid to run UCI?
That ASO said non is potentially great news for those wishing for a separation (of state, if you will) between an organization with dual roles in conflict: promotion and oversight. These types of governments don’t stand and their citizens do not fare as well in many respects. A scramble for money can provide a tremendous incentive for reform OR it can provide a tremendous urgency to delve further into poor practices. Just as an athlete has to choose for which goal to strive or which role to take, the UCI needs to decide if it’s a sprinter or a climber. Being a rouleur leaves the “team” of world class cycling without a victor in oversight; ASO is already sprinting far away as the victor in promotion.
You uncovered where the seed money came from for WCP. Did Tour of China generate a profit? Loss? who spent what where to get the top line profit/loss at WCP? How many different ways did Pat personally get paid for the Tour of China? This is the fundamental problem with WCP.
WCP is bad, bad bad for the sport.
This seems to be setting up for another round of ASO vs UCI, except now the ASO has many more and better races in its vault. I think we are 1 doping scandal or serious accusation of corruption away from another showdown circa 2008.
If any movement of a breakaway league gains traction, they would seemingly only need to strike a deal with the ASO to assure the biggest races are held outside the purview of the UCI.
Inrng – do you have a sense if there is enough money in TV revenues to cure the financial woes of the sport? It seems to me that barring the TdF and perhaps a few of the classics, there really isn’t enough TV money out there, especially given the odd hours and limited coverage most channels provide.
Now, maybe the future is in streaming broadcasts – but it is harder to get people to advertise in streaming broadcasts, due to lack of geographic specificity.
Either way, your post is very apt – for all that we fans bitch and moan about doping, doping isn’t really what ails the sport. It is the lack of financial stability. When a team like HTC goes under (imagine if Ferrari went under in F1), you know that the economic basis on which the sport operates is seriously flawed.
Great. Not enough financial woes in this world but pro bicycling seems to be teetering on the edge of disaster just as it’s really gaining real traction in the US/Canada and Australia.
channel_zero: I don’t know the Beijing race financials. We should get them when the UCI accounts for 2011 are approved in the autumn. As for senior officials profiting, who knows. But the lack of transparency only lets people make the accusations.
Guadzilla: the real money from TV comes from terrestrial channels broadcasting the race into the homes of millions of ordinary people. Many in France and beyond tune in to watch the countryside, another large segment of the audience are over 60. Streaming is perhaps for you and me… but not yet the means to reach millons and sell washing powder or butter and other things.
Alan: the growth of cycling in what the French call “anglo-saxon” countries is impressive but even if the economy is on hold in Spain and much of Europe the sport will go on. We will lose races at the margin but the big races that everyone loves are surely safe.
@Inrng – no arguments there: streaming videos are indeed a hard broadcast option to monetize.
My point was: at present, is there really enough race coverage happening yearlong to make economic sense for the sponsors? In other words, if you leave aside the TdF and perhaps a couple of other classics, do the 30′ of cycling highlights shown at 11:30pm generate enough viewers to make it attractive to phone companies, tile companies, etc? It seems to me that presently, barring a few races, most others don’t attract nearly enough viewers to make TV revenues a significant source of money for the teams – although I could be wrong.
You could always just distribute the TdF revenues among the Pro Tour teams but then you increase the gap between the haves and the have-nots. And good/competitive Pro Continental teams are, IMO, a key part of racing.
Not too keen on the thought that new races from the UCI/GCP will most likely be fast-tracked to WorldTour events. The WT calendar seems full enough as it is, and if any more races like Beijing are likely to be brought in then races with more tradition are obviously going to suffer.
Also Beijing was such a dire race.
Also, it’s disconcerting that the winner of a race like Beijing or TDU gets the same amount of ranking points as 3rd place in the Giro or the winner or Roubaix. There are two points tiers for the one-day races, and there should definitely be two tiers for the WorldTour stage races.