- 01 Feb 10, 02:13#182570
There has been some debate as to how the new points system will effect F1, and particularly the new teams. It has been suggested that the new points system will help the new teams financially through prize money, sponsorship etc. This had me second guessing my initial opposition for the change, so I decided to do some research on exactly how prize money was distributed, and how the new points system would effect it. I tried to gather the most accurate information available, but I have discovered that finding specifics is rather difficult as F1 keeps its finances rather secretive. If anyone can add anything to what I have below or point out errors I would appreciate it, it would be nice if we could put together some accurate numbers to reference.
Here is an interesting article that explains the pros and cons to the new system rather well, this is referring to the first iteration of the new points system, so its not completely up to date (2nd place still shows 20 points etc.) but it brings some interesting points to the table.
http://www.yallaf1.com/2009/12/21/good- ... ts-system/
"The prize money will also be spread out which could be a useful bonus for the new teams if they can finish a few races in the top 10."
Sounds great right? Well I have done a bit of web searching and have gathered that its not all that it seems, especially for the new teams. For starters the distribution of money is as fallows, the FIA gets roughly 50% of the TV revenue, FOM gets 49% and the actual teams only get about 1% (I'm starting to understand some of the fuss made by FOTA early last season). Now 1% still produces a lot of money, but I think we can all agree that the teams are getting shafted. Now most of us know that on a race by race basis, drivers are rewarded by their teams for good results, and the team is often rewarded by its sponsors. The actual amount varies by the team, the drivers contract with the team, and the teams contract with its various sponsors. I am still looking for more info on prize money on a race to race basis but I have found nothing that suggests the team actually receive anything from the FIA or FOM for wins or good results other than championship points, it all goes to the constructors championship standings at the end of the season. If this is indeed the case, then giving points to the 9th and 10th place teams really does nothing financially to help the new teams, at least from the FIA and FOM. As of 2007, the numbers looked something like this:
http://www.f1wolf.com/2007/09/formula-1 ... money.html
Those seem like reasonable shares given their measly 1% of the TV revenue, but now that same share of money is being spread to more teams. Not to mention that "To qualify for the prize money, the team has to finish in top 10 in two years running." So unless this has changed (which is very possible) new teams won't receive anything until 2012 at the earliest, which is hardly helpful to a new team that is trying to gain financial stability. What's even more ridiculous is that last year, Bernie Ecclestone announced that he plans to halve the prize money paid to the teams unless they sign a contract committing them to race for 5 years.
http://uk.reuters.com/article/idUKTRE53T0P720090430
"They (the teams) want to be paid in the same manner as if they had agreed to be committed (to race) for five years but they don't want to be committed," said Ecclestone.
"They shouldn't get the prize money. We are now running more of a cash-on-delivery service. You sign the contract and we will pay you in full," he added.
Now I don't think any of the new teams being introduced this year can honestly say they know for a fact that they will be racing 5 years from now, and I cant even begin to imagine what Ecclestone would have in store for a team that broke this contract. That's not all, the prize money is non-transferable, which seems like it makes sense right? Well where this really comes into play is in a situation like Brawn GP. Honda had prize money from 2008, but since they Honda quit and sold the team to Brawn, their prize money, according to the concorde agreement, was to be distributed to the rest of the remaining teams, even though the same team raced on into 2009 under a new owner and name. This same situation will likely apply to Sauber this year.
http://www.formula1blog.com/2009/05/03/ ... ize-money/
So in a nutshell, F1 is not kind to new teams with regards to its prize money distribution and I still like the old points system better
.
Here is an interesting article that explains the pros and cons to the new system rather well, this is referring to the first iteration of the new points system, so its not completely up to date (2nd place still shows 20 points etc.) but it brings some interesting points to the table.
http://www.yallaf1.com/2009/12/21/good- ... ts-system/
"The prize money will also be spread out which could be a useful bonus for the new teams if they can finish a few races in the top 10."
Sounds great right? Well I have done a bit of web searching and have gathered that its not all that it seems, especially for the new teams. For starters the distribution of money is as fallows, the FIA gets roughly 50% of the TV revenue, FOM gets 49% and the actual teams only get about 1% (I'm starting to understand some of the fuss made by FOTA early last season). Now 1% still produces a lot of money, but I think we can all agree that the teams are getting shafted. Now most of us know that on a race by race basis, drivers are rewarded by their teams for good results, and the team is often rewarded by its sponsors. The actual amount varies by the team, the drivers contract with the team, and the teams contract with its various sponsors. I am still looking for more info on prize money on a race to race basis but I have found nothing that suggests the team actually receive anything from the FIA or FOM for wins or good results other than championship points, it all goes to the constructors championship standings at the end of the season. If this is indeed the case, then giving points to the 9th and 10th place teams really does nothing financially to help the new teams, at least from the FIA and FOM. As of 2007, the numbers looked something like this:
http://www.f1wolf.com/2007/09/formula-1 ... money.html
Those seem like reasonable shares given their measly 1% of the TV revenue, but now that same share of money is being spread to more teams. Not to mention that "To qualify for the prize money, the team has to finish in top 10 in two years running." So unless this has changed (which is very possible) new teams won't receive anything until 2012 at the earliest, which is hardly helpful to a new team that is trying to gain financial stability. What's even more ridiculous is that last year, Bernie Ecclestone announced that he plans to halve the prize money paid to the teams unless they sign a contract committing them to race for 5 years.
http://uk.reuters.com/article/idUKTRE53T0P720090430
"They (the teams) want to be paid in the same manner as if they had agreed to be committed (to race) for five years but they don't want to be committed," said Ecclestone.
"They shouldn't get the prize money. We are now running more of a cash-on-delivery service. You sign the contract and we will pay you in full," he added.
Now I don't think any of the new teams being introduced this year can honestly say they know for a fact that they will be racing 5 years from now, and I cant even begin to imagine what Ecclestone would have in store for a team that broke this contract. That's not all, the prize money is non-transferable, which seems like it makes sense right? Well where this really comes into play is in a situation like Brawn GP. Honda had prize money from 2008, but since they Honda quit and sold the team to Brawn, their prize money, according to the concorde agreement, was to be distributed to the rest of the remaining teams, even though the same team raced on into 2009 under a new owner and name. This same situation will likely apply to Sauber this year.
http://www.formula1blog.com/2009/05/03/ ... ize-money/
So in a nutshell, F1 is not kind to new teams with regards to its prize money distribution and I still like the old points system better
.