Business

The Finances of Team Sky

Cycling teams are businesses. The holder of a UCI Pro Team licence can be an individual but most often the team is a corporate entity, a company created to handle the income from sponsors and pay out expenses like rider wages.

This is the case with Team Sky and, like all companies, it publishes its annual report and accounts. Here is a look at the finances of Team Sky, from the exact budget down to the tiny details and it’s more than just dull accounts, it tells us plenty about the team and the sport. Including why the team has only three employees.

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Saturday Shorts

April and May were cloudy and wet across much of France and one consequence is that a lot of crops are slow to grow. A big problem for farmers and the nation’s giant agribusiness… but also minor headache for photographers in the Tour de France.

On day when nothing much happens in the race if the sun is shining a photographer is sure to sell a photo of the bunch rolling past a field of sunflowers. It’s the sort of image that will make the front page of a newspaper even if most of the readership aren’t following the race. Only the crop in many parts of France is still some way from flowering.

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Cycling Fans Versus The Mass Market Audience

You’re probably male and aged between 25 and 45. No, this blog doesn’t have some high-tech way to monitor readership, it’s more that men in this age group are the biggest followers of cycling in the US, UK and Australia and other English speaking countries so there’s a good chance you fit into this category as you’re reading an English-language niche cycling blog.

Regardless of your age, gender or location, I’m pretty certain you’re a big fan of cycle sport. A casual fan might visit cyclingnews.com from time to time, a blog like this one is more specialist. But in both cases we’re talking about some actively seeking news, results and more. And this is quite different from the vast majority of those who watch races. When it comes to watching bike races, cycling fans are a minority.

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Revenue Sharing: Chump Change or Structural Change?

A bicycle race is a simple affair with some riders, a start and a finish.  But the organisation and management of professional cycling is complicated by rules, law, money and business.

The news that pro cycling teams could get a share of the TV rights money paid by broadcasters would mark a significant change to the way business is done today. Here is a look at some of the issues surrounding revenue sharing. For now we don’t have much detail so it remains to be seen whether this is just some extra cash for the teams or a structural change to the way the sport is organised.

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How much is a race worth?

That’s the prize list for yesterday’s Flèche Wallonne race with a first prize of €16,000 for the men’s race and just €1,128 for the women’s race.

It’s one of the most prestigious one day races on the calendar but many might see the cash prize as rather small. For comparison, last Sunday’s Amstel Gold Race offered €16,000, a sum similar to the prize for making the semi-finals of the Dutch Open tennis tournament, in other words coming fourth in a modest tennis tournament.Win the golf tournament in the Netherlands and you pocket €300,000.

But the value of a bike race probably isn’t reflected in the prize list. Instead there are other ways of judging the value of a win.

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Oiling the Wheels in Turkmenistan

In March this blog looked at the award of the 2013 track world championships to Belarus, a decision taken with input from a senior UCI official with a significant financial interest in a giant construction project in the capital, Minsk. Whether coincidental or not, the awarding of the worlds served to highlight the significant conflict of interest between the UCI’s sporting interests and the business activities of Igor Makarov, the Russian oligarch behind the Katusha team who now sits at the UCI’s top table, the Management Committee.

Now it’s time to take another look because sadly the overlap between sport and business is not restricted to one case. In another example here is a tale from Turkmenistan.

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More money, more problems

Yesterday the UCI put out a short press release on the apparent financial health of the pro peloton. Two statements stood out

  • the budget of the 40 top teams is €321 million, an increase of 36.5% over three years
  • the average annual salary is €264,000, up from €190,000 three years ago

It sounds great, money is pouring into the sport and riders wages are going up. Only the more I think about it, the more these trends are not healthy.

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Who made your bike?

Did you know the three cyclists on the 2008 Tour de France podium all used bikes produced in the same factory? Yes, the design and decals might have varied but there was only one manufacturer behind all three riders.

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