Liberty CEO seeking to avoid 'snot-gobbling Concorde fight'

Christian Horner (GBR) Red Bull Racing Team Principal with Greg Maffei (USA) Liberty Media Corporation President and Chief Executive Officer on the grid. 30.10.2022. Formula 1 World Championship, Rd 20, Mexican Grand Prix, Mexico City, Mexico, Race Day. -, EMail: © Copyright: Batchelor / XPB Images
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Liberty Media CEO Greg Maffei has said he's determined not to get dragged into any protracted fights over the Concorde Agreement, the contract that sets the terms and conditions between Formula 1 and teams for the next decade.

In the past, negotiations have been long, drawn out and bitter battles, but Maffei believes that current relations today between the teams and current owners are much more harmonious.

"Historically, the Concorde Agreement was a snot-gobbling fight, and never got signed until after the season had already ended," Maffei explained at a recent event hosted by investment bank Goldman Sachs.

"The teams were operating backwards on what they were getting paid," he said, adding that his predecessor at Liberty Chase Carey and current F1 CEO Stefano Domenicali had changed that culture.

"We got it done this time," he said. "We're trying to change the dynamic. I credit first Chase Carey and now Stefano with changing the dynamic with the teams, where we are far more aligned.

"That doesn't mean they want to pay us more!" he acknowledged. "But they all agree on the value of what we're doing together, and that growing the pie has been a positive thing for everybody."

Liberty Media took a controlling interest in the Formula One Group for $4.4 billion at the start of 2017 leading to the departure of Bernie Ecclestone with whom the teams had often been in conflict.

The current deal runs from 2021 to 2025. The next Concorde Agreement for 2026 will be the first to be negotiated by Domenicali, and Maffei made clear his main objectives in the upcoming discussions.

"What we're basically talking about is an early renewal of a deal that is very similar to the terms that they have today," he said. "Providing stability and certainty about where we're going is a benefit to them.

Greg Maffei (USA) Liberty Media Corporation President and Chief Executive Officer (Centre) with Stefano Domenicali (ITA) Formula One President and CEO (Right). 18.06.2023. Formula 1 World Championship, Rd 9, Canadian Grand Prix, Montreal, Canada, Race Day. -, EMail: © Copyright: Bearne / XPB Images

"You've seen the value of F1 rise dramatically," he continued, highlighting the growth in earnings before interest, taxes, depreciation and amortisation in the last few seasons.

"The reality is the teams' valuations have increased much faster. They see the benefit of the regime that we've together created, they see the benefit of extending that deal."

"Why do we think that's a benefit? I think we can all sell sponsors, we can sell broadcasters, we can sell all people on the certainty of the sport, and you de-risk any of the potential in the future.

The grid before the start of the race. 27.08.2023. Formula 1 World Championship, Rd 14, Dutch Grand Prix, Zandvoort, Netherlands, Race Day. -, EMail: © Copyright: Moy / XPB Images

He said it would give teams "the opportunity to go out and sell the same sponsors on those ideas, so all of that is why everyone sort of wants to extend the current regime - and I think we've seen good interest in that."

Maffei conceded that under the current agreed sliding scale, Liberty takes a higher proportion of earnings as overall revenues rise. "Above a certain percentage, we're betting on ourselves," he said.

"What's happened as we've grown the sport is that the amount above that split number has grown, so our share has grown.

"I don't anticipate a major change in how that works. There will probably be something along the same lines, and we'll have an incentive to grow the business."

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