AG2R participate in court-ordered team-building exercises (Getty images)

The announcement comes just days after AG2R team manager Vincent Lavenu declared to infamous Eurosport commentator Brian Smith that the 2012 Tour de France route was “well-suited” to Peraud, as reported by cyclingnews.com. Teammate Christophe Riblon also declared his allegiance to the Gadret-Peraud bloc with his fawning summary of Peraud:

It’s all in the eyes. He has this magnetic gaze that instantaneously makes you melt, yet gives you power to conquer the highest peaks of Europe. I’d follow him to the ends of the earth, or the nearest nightclub, whichever came first,” gushed Riblon.

Nico Roche spent the ensuing 24 hours following Lavenu’s media session by chopping wood at his father’s summer retreat in the Pyrenees. This undertaking was part of his therapist-decreed anger-suppression exercises, implemented as reparation for his infamous outbursts alleging Gadret’s impersonation of Benedict Arnold at the 2010 Tour de France.

Roche famously decreed that if Gadret had been found dead in a hotel room, he would have been the primary suspect and followed that up with his other scathing comment about putting Gadret’s head through a bus window. Roche has been a shadow of his former self post-2010, and has been looking for ways to regain his confidence. However, the words and actions of Lavenu in 2011 cemented the requirement for the off-season Peace Summit.

When reached for comment, Peraud was his typically diplomatic self, reflecting the attitude of a true champion.

Roche is a very strong young man with all the phyical attributes required of a solid professional bicycle racer. He is meticulous in his preparation for races, to the point of obsessive compulsiveness. However, the question still remains, does he have the mental ability to rise above the petty skirmishes that he has initiated with Gadret?”

Gadret was more than open with his assessment of the reasons for the peace conference.

Roche called me a wingnut. Who’s the wingnut now, Roche? I was at the Giro d’Italia presentation flirting with the ladies backstage and getting phone numbers. Where was he? Chopping wood in the Pyrenees, I presume.”

Roche declined our phone calls for this report. However, upon the appearance of a Cyclismas.com reporter to his summer retreat, Roche did his best impersonation of a young Sean Penn by destroying all the reporter’s technical equipment, including his new iPhone 4s. Roche’s agent, Andrew McQuaid, son of UCI Emperor-for-Life Pat McQuaid, also refused any comments to the press other than two words which aren’t permissible to publish.

Lavenu will be conducting the peace summit under the watchful eye of AIGCP head, Jonathan Vaughters. Cyclismas.com will have the exclusive results of the meetings upon their conclusion October 29th, 2011.

The AIGCP are but one of many supplicants asking the Amaurys to share more of their wealth with them. Before coming back to the AIGCP’s case, let’s consider some of their revenue-sharing rivals.

Away back in the eighties, when the Tour was heading toward gigantisme and was finally contributing something to the Amaurys’ wealth, Félix Lévitan claimed that the race received not even a single centime in public subsidy. In this Lévitan was not wrong. So sure of himself was he that he even offered to throw open the Tour’s books to prove his point. But, at the same time, Lévitan was not right. For the Tour has always been subsidised by the French state.

After the end of the second world war, the French state began to pay subsidies to newspaper operators. At a time when the Tour was a financial drain on the coffers of L’Équipe and Le Parisien Libéré – remember, it was 1974 before it turned its first profit – Émilien Amaury’s newspapers were receiving subsidies from the state. Indirectly, those subsidies subsidised the Tour.

Another form of state subsidy is the cost of policing sporting events. Increasingly, this is a matter of concern to policing authorities throughout the developed economies. Organisers of sporting events pay a fraction of the true cost of policing their events. Were they to have to pay the true cost, many smaller sporting events would simply cease to exist. The Amaurys today are trying to find a balance between paying a fairer cost for the policing of their events and resisting calls to meet the full cost.

Elsewhere, there is the cost of road closures. A 2009 Le Monde Diplomatique story noted that the Tour pays the Assemblée des Départements de France just €270,000 for road closures, which works out at about €75 a kilometre. The ADDDF are not yet demanding that ASO pay more, but the more others point out how little they currently pay, the harder it is for ASO to get away with paying such a small amount for the use of France’s roads.

There was even a challenge against the Paris-Dakar Rally to the amounts paid by towns, cities and départements to host sporting events (fees which contribute to the Tour’s bottom line). Rules on local government finance, it was argued, forbid such payments. It is perfectly acceptable, it was argued, to subsidise businesses creating local employment. It is not legal, the argument went, to use such money for sporting events. The initial challenge against the Dakar was successful, but in the years since then ASO appear to have found the necessary loophole that enables them to continue to receive payments from host towns. Loopholes can always be closed.

Those are just some of the ways the French state subsidises the Tour, and some of the challenges being faced by ASO. The other side of the coin is the amount ASO pays to subsidise cycling at grassroots levels in France. The French cycling federation (FFC) claim that ASO pay something in the region of just €1.2 million to support cycling at grassroots levels. ASO make a counter argument that their races, at all levels, need to be taken into account, not just the amount they pay to the FFC. But mischievous sorts also like to point out that JC Decaux, who underwrite the cost of Paris’ Vélib’ bike-sharing scheme and similar schemes in other cities, pay more to encourage cycling in France than the Amaurys do.

The AIGCP, then, are but one in a long queue of supplicants standing at the door of ASO’s headquarters. And standing right being the AIGCP is the CPA, the riders’ representative body, who are always ready to call for more money if they see someone else getting a larger slice of the cake.

The Amaurys, though, are used to this sort of thing. Look at the media side of their empire and consider the manner in which they have dealt with the print and journalist unions. Unions, by their very nature, always want more for their members. Bosses, by their very nature, always want to resist such calls. The Amaurys have been in the newspaper business since 1944. That’s close to seventy years of experience dealing with people calling for a greater share of the cake. Remember the story of that two-and-a-half-year strike that hit Le Parisien Libéré in the mid-seventies? It was included in this series for a reason. It demonstrates that the Amaurys are no pushovers when it comes to calls upon them to share more and more of their wealth.

The AIGCP, then, will need to make a very good case if they expect ASO to pay the teams more than the €1.6 million currently shared with them at the Tour. Consider, for instance, the basic €51,243 that the teams have been receiving as a participation allowance. This was originally negotiated before the current AIGCP president, Jonathan Vaughters, took office. It has been renegotiated every year since. And every year it has remained unchanged. The whole €1.6 million has, more or less, hardly changed over the last four years. That should indicate to you the scale of the problem facing the AIGCP today. ASO do not give in easily.

How much do the AIGCP actually want? That’s not known. Jonathan Vaughters did recently put a figure of €10 million on it but, when questioned as to whether this was from the just the Tour, from all of ASO’s races or from all race organisers in total, he withdrew the number. My own feeling – and this is nothing more than a gut-feeling based on nothing more than instinct, and should therefore be taken with a very large pinch of salt – is that the AIGCP are probably looking for something in the region of €5 million to €10 million from ASO, and the same again from the other race organisers.

Let’s take the bottom value of that ballpark, a total of €10 million from all race organisers. What would the AIGCP do with such a sum of money? Back in the Summer, when the AIGCP were boycotting France Télévisions in their attempts to press their case, it seemed that the money would simply pass back to the teams and be spent by them as they wished. Some of the money, we were told, would go toward anti-doping. But the rest the teams would be free to spend as they saw fit.

The biggest cost faced by cycling teams today is riders’ wages. At times, it is hard not to think of some of the teams as being like children rushing to spend all their pocket-money on the latest, shiniest toy in the shop window. Look at teams like Leopard, BMC, and Sky and the amounts they are spending on riders. Were the teams to get an extra €10 million between them, what’s to stop them just blowing it all on increased salaries for top riders as they outbid themselves for the fastest sprinter, the lightest climber and the best time trialist money can buy? What’s to stop all that money simply leaving the sport through the riders’ bank accounts?

Here the AIGCP offered the security of a salary cap. There’s various different forms of salary caps, but the most efficient – or the least inefficient – is the one which puts an upper maximum on a team’s total salary outlay. Given that teams are of a fixed size – 25 to 30 riders – this is relatively easy to implement, should all the teams agree to it. Sadly, it is almost impossible to police. In virtually every sport in which salary caps are in place, the same things happen: the teams either blatantly ignore them or abuse every loophole in the book to get around them.

Let’s consider the simplest way of getting around a salary cap: get someone else to pay your rider’s salary. A simple example for you – consider Mark Cavendish and his deal with Specialized. That is a personal deal, between the rider and the bike manufacturer. That his HTC team also have a deal with Specialized is neither here nor there. The money paid to Cavendish by Specialized is paid direct, without going through HTC’s budget. Thus it would not have been covered by a salary cap.

Any team then, wishing to get around a salary cap, would simply have to keep some sponsorship income off their books by getting the sponsor to do a deal directly with a rider. And that is just one loophole. I won’t bother going into the dozens of others that are used in sports that have salary caps in place. The point is, I think, made: salary caps are just window dressing.

This week, though, the issue of the salary cap was taken off the table when the AIGCP president suggested that the extra money being demanded by teams would effectively go to a central fund. Anti-doping would receive 20% of the fund. Another 60% of it would be set aside, similar to the ProTour reserve, and be able to be called upon by teams in financial difficulties. The balance would be disbursed among the teams, for them to spend as they see fit.

In theory, this is good. The practicalities of the matter, though, are far from simple. Now, just because something is difficult doesn’t mean that it shouldn’t be done. But the practicalities do need to be considered. Consider, for instance, the manner in which race organisers might make an extra €10 million available to teams. Some of it would, in all likelihood, be paid in the form of increased participation allowances (remember, the current UCI figure is just €7,500 and covers just the ProTour teams and the WorldTour races, excluding the Grand Tours). Some of the increased payout to teams would, in all likelihood, be linked to performance, paid in the form of prizes or bonuses.

Consider, for instance, the Tour. Let’s assume that ASO can be convinced to grant an extra €5 million from the Tour’s bottom line to the teams. If you were in ASO, at most you would grant only half of that in increased participation allowances. Which would bring the allowance up from the current €51,243 to €165,000 (I am here just tossing numbers about – bearing in mind that the current  €51,243 is unchanged over at least four years, the likelihood of it jumping up to €165,000 in the short-term seems outlandish).

The other half – €2.5 million – were you ASO, you might want to link to performance. You would make it available to the teams through enhanced team prizes, linked to their performance in the Tour. Which means that some teams would pocket more than others. Recall, for instance, that breakdown of the 2011 Tour prize fund we looked at earlier in this series. Of the performance-related element of the €1.6 million currently shared with the teams (€433,000) Garmin-Cervélo pocketed €81,200 while Vacansoleil and Katusha pocketed just €200. That’s not a typo. That’s really two hundred euros. Radioshack pocketed just €700. The average was €19,682. The median was just €14,625.

The difficulty then is in making a performance-related element of any increased payout to the teams available to the sort of reserve fund suggested by the AIGCP. Difficult, yes. But not impossible. And so not a reason not to do it. But, as I say, such difficulties do need to be considered. If the AIGCP cannot convince you or me of the practicalities of their plan, what hope do they have against someone as well-versed in negotiating as ASO? You and me, we’re pussycats when compared to ASO.

* * * * *

Why am I making these observations? Because I do believe that fans have a role to play in this. Consider doping. Why didn’t cycling clean up its act post-Festina? Because, as Benjo Maso has noted, the fans didn’t want to know about it, the riders didn’t want to talk about and the media didn’t want to report it. Why did the sport finally begin to change itself after Operación Puerto? Because the balance of power had shifted.

What changed? Among other things, the power of the fans changed. Ten years ago, fifteen years ago, we didn’t matter. We had no voice. Then the internet came along and gave us a voice. An imperfect voice, I’ll accept. And a voice which doesn’t always reflect positively on us. But a voice nonetheless. And journalists who once didn’t want to report the reality of this sport began to see there is an audience for reality. And the editors who once didn’t want their journalists reporting reality began to see there is an audience for reality. It became harder to ignore us, the fans, the people who buy the products sold by the sponsors who fund the teams who employ the riders who keep the wheels of this sport going around. The dumb schmucks in the cheap seats. The least important stakeholder in cycling.

I’m not here trying to blow the trumpet for the Internet or for sites like this. There’s an awful lot about the Internet that I hate, and even on a site like this there are things I don’t agree with. I’m merely trying to acknowledge fairly what changed. The Internet changed the way this sport is reported. And that has helped to change what is happening in this sport. If you don’t believe that, then ask yourself this: why did Paul Köchli fail in his attempts to operate a Team Clean in the nineties, when men like Jonathan Vaughters were able to succeed in the noughties?

Fans have a role to play in how cycling moves forward over the next few years. We can influence those team managers who, like Jonathan Vaughters, take the time out to listen to us. We can influence those journalists who report this sport properly and their editors who limit what they can and cannot report on. Ultimately, through those indirect channels, we can influence the race organisers. And through them we can influence the UCI.

We have a voice in the revenue-sharing debate. The AIGCP have, so far, been the ones framing the debate. Using the media to make the issue public. We don’t have to be passive, to simply sit back and listen to what they choose to tell us. We have today, through the Internet, a chance to join in the debate. To influence its outcome. I have tried in this series to offer my take on what I see as being some of the key aspects of the revenue-sharing debate. The issues I think need to be considered when looking at revenue sharing. To move the debate forward, the rest is up to you. You have a voice. Use it.

Next: Paris – the end of the road (for now).

Previously: Calculating the Tour’s TV Revenues.

Cavendish wears the strips. With black shorts.

Inspired by the events that began in New York City on September 17th under the auspices of Adbusters, both gentlemen decided that “enough was enough,” and they’d “had their fill of UCI “over-regulation.” Cavendish, in fact, withdrew from the Giro di Lombardia in order to organize the Swiss demonstration.

“I’ve had enough of their bullshite, and the fact that I have to wear f***ing white shorts with my world champion jersey was the absolute last straw,” stormed Cavendish, “Pretty soon they’ll be telling me when I can have relations with my dynamite girlfriend, Peta.”

When told that this was technically already the case, especially if he were to be caught “mid-shag” by an out-of-competition biological passport control officer knocking on his door, Cavendish shrugged his shoulders and smiled.

“I haven’t had one of those since they started that bullshite program. I don’t think anyone actually ever has [had a biological passport programme control]. In fact, I can’t remember the last time I had to do a piss test,” stated Cavendish.

Cancellara was a little more reserved in his judgements, “I’m just disappoint that the UCI guys has forgottent my favorit status in 2011. I’m insult that even tho I was for shure great and sucsesfull at true racing, they’ve choosen to castet aside of my person for pockfaced Gilbert. It hurts my insideness.”

“Irksome” bloggers the world over, numbering in the tens of thousands, joined in the march from Vevey to Aigle. Standing in their support were some of cycling’s most vocal critics of the UCI, including Jonathan Vaughters, Eurosport’s David Harmon, USADA head Travis Tygart, Dr. Michael Ashenden, Franco Pellizotti, and the formerly-disgraced-and-now-vindicated Floyd Landis, who carried a burning effigy of Pat McQuaid. Curiously, when Riccardo Ricco pulled up in his sometimes partner’s Skoda, the entire movement barred his attempts to join the crowd.

UCI president Pat McQuaid and former president Henricus Verbruggen stood defiantly at the doors of world cycling’s headquarters, while the vast majority of UCI employees called in a “vacation day” and milled around outside, not quite sure what to do with themselves. Several were seen to be passing out file folders stamped “Confidential” to anyone who appeared even slightly interested. By the early evening, an informal twitter village had been set up to live-blog the event, with both Verbruggen and McQuaid still not fully grasping the impact of the social media platform.

Asked when the movement will end, Cavendish was cryptic, “This movement will end when the corrupt rulers of Aigle step aside for a Brit to rule this organization what’s been revived by the surge in cycling’s popularity throughout the United Kingdom. Or when I can wear my black shorts.”

“Newspapers created the Tour de France, radio made it popular, television made it rich.”
~ Christian Prudhomme, 2010

 

In a July 19 story on Bloomberg, the following comment appeared:

“ASO may get as much as $200 million from TV rights, while the 22 Tour de France teams typically have an annual budget of $10 million each from sponsorships, [AIGCP president Jonathan] Vaughters said.”

The story was about attempts by Garmin-Cervélo, HTC-Highroad and Radioshack to limit France Télévisions’ access to their team vehicles during the Tour, contrary to a requirement to grant access to the TV rights-holder. The funny part of this story is that, in the AIGCP’s Ten Point Plan For Cycling, the team managers called for the use of in-car cameras and yet there they were during the Tour, blocking the use of such technology. Then again, the AIGCP’s Ten Point Plan also called for the internationalisation of the cycling calendar only for the AIGCP teams to threaten to boycott the UCI’s latest attempt to bring cycling to non-traditional nations with the the Tour of Beijing.

The fact that the AIGCP says one thing and then goes and does the exact opposite is not what’s interesting about this Bloomberg story (though it’s a fact worth filing for future reference). No, what’s interesting is the comment quoted above. It’s worth repeating. See if you can spot the problem with it.

“ASO may get as much as $200 million from TV rights, while the 22 Tour de France teams typically have an annual budget of $10 million each from sponsorships, [AIGCP president Jonathan] Vaughters said.”

Did you spot it? Yes, that’s right, it’s the failure to compare like with like. As we all know by now [see parts passim] ASO’s TV income – the value of which we’ll return to in a moment – doesn’t all come from the Tour de France. It doesn’t even all come from cycling. But you show that Bloomberg article to someone you know and, after they’ve read it, ask them how much the Tour’s TV rights are worth. I’m willing to bet the majority of people will say $200 million.

Now here’s an easy question, one designed to see if you’ve been paying attention as we’ve dawdled aimlessly through different aspects of the revenue-sharing debate: in 2009, what was the total revenue of ASO? Correct, it was €145 million. Which is how much in dollars? Give or take a rounding error, I’d say that’s about $200 million, wouldn’t you? So either: a) ASO have had a phenomenal increase in revenues in the last year and a bit; or b) the $200 million figure for ASO’s TV rights is total bunkum. Hmmnn, now there’s a real two-espresso puzzler.

So how much are the Tour’s TV rights worth?

Let’s begin by looking at just one TV deal, the headline-grabbing one with the host broadcaster, France Télévisions. A broadcaster so powerful they can tell the UCI that race radios are killing cycling and the next thing you know Pat McQuaid is issuing an edict banning their use.

France Télévisions recently renewed their deal with ASO, covering the rights for 2014 and 2015. The deal is made up of a package of events, including not just the Tour de France but also Paris-Nice, the Critérium International, Paris-Roubaix, the Flèche-Wallonne, Liège-Bastogne-Liège, the Critérium du Dauphiné and Paris-Tours. The deal also includes other ASO events such as the Paris Marathon and the Dakar Rally.

France Télévisions’ previous deal, signed in 2008, expires in 2013. The total value of that deal has been put at €120 million, being made up of €23 million for the 2009 rights, increasing by 2% per annum after that (i.e., rising through €23.9 million in 2011 to about €24.9 million by the end of the contract in 2013).

Now here’s a question for you: of the €23.9 million France Télévisions paid ASO for TV rights in 2011, how much would you apportion to the Tour de France?

You could do some simple math: add up the number of days covered by all the relevant ASO events, work out what proportion of those days the Tour’s twenty-three days represents and then apply that to the €23.9 million. You’d probably get a figure somewhere in the region of €5m if you did.

More correctly, you’d want to split the revenue based on audience share of the actual TV coverage of the individual events. The amount of work involved in doing that, however, is above my pay grade, so don’t look to me to tell you what the answer would be.

What you most certainly do not want to do is be exceedingly generous and say that all of the €23.9 million is due to the Tour and all the other events in the package are freebies, part of a super-dooper BOGOFF deal ASO offers France Télévisions. Not that anyone would be dumb enough to do that. No, some people would be way dumber: they’d take the full value of the five year deal – €120 million – and say that was the annual value of the Tour’s TV rights. There’s some very, very dumb people out there.

There’s also some very, very clever people out there. The sort of people who would take the total multi-year value of all of ASO’s TV deals – call it $200 million – drop it into conversation, and then talk about the Tour de France and the annual budget of participating teams. Never once would they say that all of the $200 million related to one year, never once would they say it all related to the Tour de France. But neither would they ever say it didn’t. Some people are too damned clever by far.

The point to note is that, whatever way you slice it, you will still end up with a figure well south of €23.9 million as being due to the 2011 Tour from the France Télévisions deal.

Now, having done all the math that’s already been asked of you, you’re probably feeling like going for a quick lie down. But you’re only just past Go on cycling’s Monopoly board. You now have to do the same math with all the TV deals ASO have in place before you get to sprint past the posh properties and collect your €200. And the Tour is – allegedly – seen on TV in 186 countries (the UN says the world is made up of 194 countries; one day ASO will list all 186 countries receiving the Tour and we’ll be able to work out who the eight countries are that need to be love-bombed by cycling fans).

If calculating the French audience share of the various ASO events is above my pay grade, you can guess how much effort I’m willing to put into collating all the relevant TV deals, identifying the events each covers, finding insiders willing to put values on each contract (TV companies hate to reveal how much they pay for sports rights) and then trying to work out how much of that relates to one edition of the Tour.

It does all sounds like rather a lot of hard work, doesn’t it? Is it any wonder people just pluck numbers out of thin air? But is using made-up numbers that bear little or no relation to reality a proper basis for discussing something supposedly as important as revenue sharing? No it isn’t.

Is there a way of short-cutting the process? Possibly. Earlier in this series I gave you figures for ASO’s performance in 2003. In that year out of a total 117 days of sport organised by ASO, 74 of them were cycling. In total, cycling contributed 70% of the company’s revenue. ASO’s total income – somewhere between €110 million and €120 million – was split between TV rights (44%), marketing (39%), competitors’ rights (12%), and local communities (5%).

Let’s, for the sake of argument, call the revenue €115 million. Let’s start by being generous. Super generous, in fact, and say that all of ASO’s 2003 TV revenue came from just one event, the Tour de France: that would have been €50 million (€115 million x 44%). Markedly south of $200 million, even allowing for inflation over eight years.

But, as we’ve already seen, being super generous would be super stupid. Let’s try to be intelligent. Cycling’s share of ASO’s 2003 revenue was 70%, or €80.5 million. Let’s make an assumption here, which is that ASO’s TV revenue splits evenly across all their sports. Crazy assumption, I know, but let’s run with it. That would give us cycling’s TV revenue (in 2003) as having been €35.4 million (€80.5 x 44%). How much of that do we apportion to the Tour? It contributed about a third of the cycling days. Call the Tour’s TV revenue €11 million? Or be generous, and say the Tour was worth at least half the TV revenue, €18 million? Hell, let’s be kind and call it a nice round €20 million.

That was eight years ago. The sport has seen boom and bust since then. Can we find a more up-to-date roundabout way of doing the calculation? Well ASO’s marketing director, Laurent Lachaux, has in recent years estimated that the Tour is getting as much as 60% of its revenue from TV rights (with 30% coming from sponsors and most of the rest coming from fees paid by the towns that host stages of the race). Previous estimates from Lachaux had put the TV revenue at 50%, with sponsors chipping in 40%. This suggests that sponsorship income, following years of doping scandals and a global ecomonic crisis, has fallen back somewhat. Whatever the figure, 50% or 60%, it’s useless without knowing the race’s revenue line.

Here we turn to an estimate I don’t like. Pierre Ballester – David Walsh’s partner in crime for L.A. Confidentiel and Le sale tour – has in recent years put a guesstimate of €100 million on the Tour’s budget. For me, that number’s far too round, looks too much like it was plucked out of thin air. It also looks far too high, based on previous estimates. But let’s assume that Ballester knows something here. His figure would tell us that the Tour’s TV revenue was in the region of €50 million to €60 million. A substanial figure, but again, substantially different from the figure the AIGCP have tried to suggest.

* * * * *

What have we got at this stage? We’ve got a ballpark figure for the Tour’s TV revenues as somewhere between €20 million and €60 million. I say that the upper figure is over-inflated while accepting that the lower figure needs beefing up. Can we find an acceptable middle ground, that the Tour’s TV revenue is probably in the region of €40 million to €50 million?

Whatever the figure, it’s important to remember that the teams currently get €1.6 million of whatever it is. Which, as AIGCP president Jonathan Vaughter’s recently noted, barely pays for two bus drivers per team when shared out among the individual teams. So just how much of the Tour’s TV revenues do the AIGCP expect ASO to share with them? Clearly more than €1.6 million. And, from comments made by Vaughters’ AIGCP colleague Johan Bruyneel, clearly more than the €3.4 million total prize pool, too. Which leaves me wishing I knew the answer to this question: just how much do the AIGCP think ASO can afford to share with the teams?

Let’s wrap this up with a question: why TV revenues? Why single them out? Why not simply demand a share of all the Tour’s revenue? Why not simply point out that the participation fees negotiated between the teams and ASO – presumably between the AIGCP and ASO – are no longer deemed sufficient and the teams have rethought their previously-negotiated position and, on mature reflection, now think they deserve a greater reward for their role in this sport?

The AIGCP won’t do this, for obvious reasons. So they focus on the emotive issue of TV revenues. But do the AIGCP really believe that the TV revenues are surplus to ASO’s requirements, that all the other costs of putting the Tour on – which include, don’t forget, travel and accommodation expenses for all twenty-two teams for all three weeks of the race, which alone must run to an amount not unadjacent to the €1.6 million cash the teams already take out of the race – are covered by the Tour’s other income, from sponsors and host towns? That TV revenue is pure profit to ASO? Bear in mind here that, in 2006, 2008 and 2009, ASO reported total profit of just €32 million a year. That’s from all their events, not just the cycling ones and most certainly not just the Tour de France. It seems clear, to me at least, that TV revenues are not surplus to ASO’s requirements.

Right now, I am not arguing that the AIGCP don’t deserve a greater share of the cake, don’t deserve more crumbs from the table. Right now all I am doing is questioning the manner in which the AIGCP are asking for their due. Because right now, the AIGCP’s attempts to focus this debate on a massively-inflated TV revenue figure just make the managers look pretty damned silly.

Next: Can a salary cap stop the teams from blowing all their pocket money in the one sweetshop?

Previous: Licenced to thrill.

The Smartest Man in Cycling

Cyclismas: Thank you for the tour this morning of UCI world headquarters. It was enjoyable to see the work that you do here in Aigle. First question is two-pronged – what are your favorite parts of the complex here, from a personal perspective and also from a professional one?

Pat McQuaid:

You’re quite welcome. I’m very proud of our facilities here. We have nothing but the best of the best, from the materials used in the construction and finishings to the exquisite handmade furniture. The Swiss have impeccable taste. As far as favourite parts? I’d have to say on a personal level I’m rather fond of our wine cellar – I believe the collection is now valued at well over 2 million Swiss francs, and contains, in addition to the rare vintages, some of my favourite spirits. Of note are a few bottles of exclusive Nun’s Island whiskey. I’ll crack that for special occasions, like when we grant [uses air quotes] “victories” to the AIGCP. On a professional level, I quite enjoy the spaciousness of my office. It certainly is my home away from home.”

Cyclismas:  Okay, so let’s get right into this then. You mention [mimicking McQuaid’s air quotes] “victories” being conceded to the AIGCP. What do you mean by that?

PM:

Look, it’s painfully obvious.  We never really cared about the race radio business. Not at all. Pure rubbish. But certain riders and team owners were so whipped up over it, Hein thought it might be a good way to ensure control over the peloton. Take a look at the fact that after we took it away, and they did their little temper tantrum walk-out business, the end result was that they still went to China. We just wanted to make sure they were present in Beijing.”

Cyclismas: But why Beijing? Why the importance on that particular race?

PM:

Have you been a cave for ten months, boy?  Hein [Verbruggen] has a personal interest in Beijing. He ran the organizing committee, and he’s a smart businessman. There is only so much money in the first world nations, and everyone is fighting for a slice of a that golden pie. The only growth areas are in the so-called BRICS countries of Brazil, Russia, India, China and South Africa. With Hein’s connections in Beijing, China is an easy one for us. With the addition of Makarov to the managment committee, we have Russia in our pocket.  Two for starters is good. Anything else from the other fooking countries is icing on the cake.”

Cyclismas: What about developing races in cycling-mad areas like the United States and Europe, capitalizing on the large fan base?

PM:

To paraphrase Jonathan Vaughters from twitter earlier this week, who wants to race over shite northern European farms and stay in shite Belgian hotels? Obviously he doesn’t. As far as America, they’re all fooking broke and their current anti-corporate President is seemingly enjoying this daft Occupy-Everywhere shite. I mean really, you should be thankful Wall Street is around, otherwise you’d be shoveling horse manure instead of tweeting on your fooking eyepad or whatever it’s called.”

 

Verbruggen, the master teaches the student, McQuaid.

Cyclismas: You mentioned Hein’s personal interests in Beijing. Care to expand on what you mean there?

PM:

Well let’s see, Henricus owns a TV production company that handles some major contracts – it did the on-ground TV work for the Tour of Beijing [Ed. note: You can see the company information here]. He also has his SportAccord shell company doing massive sports projects in Beijing like the World Combat Games, and he’s pretty much friends with the politicos that did the Beijing Olympic Games. We’ve leveraged that relationship to provide an excellent cash return to our pockets.”

Cyclismas: Speaking of your own pockets, what’s with the controversy surrounding taking money from the UCI to start a for-profit corporation that has UCI insiders as shareholders rather than the UCI itself, like the FIFA model?

PM:

I’m a firm believer in trickle-down economics. Your President Reagan was right. The money we collect will find its way back into the economy based on our purchases of luxury goods for our various holdings the world over. FIFA missed the boat on lining their own pockets. I mean, really, collecting a “salary” when you can have the entire net profit? They’re too old school and still hold onto some archaic principles. Stupid fookers.”

Cyclismas: So using blackmail tactics to ensure your pockets are lined is also fair game?

PM:

Hey now, it’s not blackmail if the other stupid fooker starts it.  We’re just protecting our interests from an obvious threat to our little mafia game. We’ll just fight fire with fire, and usually no one does anything about it, because they’re all just a bunch of stupid fooking sheep. I mean, no one really gives a rats arse. If they did, wouldn’t you think that someone would have stood up by now besides that sideburned fop of a crusader?”

Cyclismas: Moving along, you’re up for election this year.

PM:

 

Well it’s not really an election, per se. It’s more of a coronation.”

Cyclismas: Coronation?

PM:

 

We had the 42 handpicked UCI Congress members cast a secret ballot that we’ll be divulging in detail sometime around February.”

Cyclismas: And what was the voting about? Can you share details with the readership today?

PM:

Well, since no one reads your shite little rag anyhow except L’Equipe, I guess I can share that we’ve passed a motion that installs me as President for Life.”

Cyclismas: Wow. Congratulations. How did you accomplish that?

PM:

It’s easy when you buy off and install a Congress that votes on UCI business. I just convinced each one individually that this is what’s best for the sport.”

Cyclismas: Isn’t this counter to the mission of the UCI? Isn’t the current world climate rather against this sort of event?

PM:

Thank goodness that cyclists don’t read too well, and they’re a little fooking stupid, and definitely spineless. So I don’t think that constituency reflects the rest of the world. I mean, cycling politics is still [uses air quotes] “the old boys club.” We even got rid of the one woman troublemaker who just didn’t get the fooking program a few years back. Thank Christ the ethics committee understands what is right and just, otherwise we might have had a flap over that business.”

Cyclismas: You’re referring to Sylvia Schenk?

PM:

Who? I don’t know what you’re talking about [winks with both eyes, while laughing].

 

Cyclismas: Any final thoughts you’d like to share with our readers?

PM:

I’d like to say thank you to the entire world of cycling for persisting with a passive mentality that has allowed a closed circle of well-connected insiders the ability to raid the cookie jar at liberty. Couldn’t happen in any other sport.”

 

Last time out we looked at the way cycling’s various stakeholders share the cost of solving cycling’s doping problem. In 2010, the teams – ProTour and Pro Conti – picked up 59% of the tab, while race organisers chipped in for 21% of the bill. The UCI itself picked up 14% of the bill, or 1,104,180 Swiss francs (call that €880,000 and you wouldn’t be far wrong).

Question: where does the UCI find the money to cover its share of cycling’s anti-doping costs? Answer: part of it comes from the teams and the race organisers, who must pay for the privilege of organising and participating in the races on the UCI’s calendar.

Prudhomme starts an eventful day. (Photo: Casey B. Gibson)

How much teams pay is pretty straightforward. ProTour teams are obliged to pay a registration fee of €50,000, plus a licence fee of €100,000 for a four-year licence (i.e., €25,000 per annum). An interesting point to note about the licence fee is that even if a team folds before the expiration of its licence, the full €100,000 is payable. So consider, perhaps, Team RadioShack. Two years into their licence, they’re folding this year. The remaining two years of their licence fee must still be paid to the UCI.

For ProConti teams, the registration fee is €13,750 (this is reduced for teams registered in certain developing countries, the reduction varying between 40% and 60%). For Continental teams, the registration fee is €2,250. For Women’s teams, €1,000. (Again, discounts of 40-60% are offered to teams in developing countries.)

Teams are also obliged to pay a CADF fee. For Continental and Women’s teams, this is €1,000 (with the discounts referred to above available). For ProConti teams, it’s €60,000. For ProTour teams, the CADF contribution is €120,000.

What do the teams get for those fees? For their licence fees, the teams get to ride in their registered league. For the teams with a ProTour licence, that means they get to ride the Tour de France. Once upon a time the Tour used to levy an entry fee on riders, and then on teams. Starting at ten francs per rider back in 1903, by the 1980’s it was about £25,000 per team (circa 125,000 French francs). That fee is now gone and all you need to enter the Tour is a ProTour licence, or the luck of being one of the four wildcard picks. As the ProTour licence guarantees entry, you can see how some teams would be willing to pay almost any price to get one. And how it has, effectively, replaced a fee that used to be levied by the race organisers.

For the CADF contributions, well the teams obviously get the warm fuzzy feeling of knowing they are doing their fair bit to help police cycling’s doping problem. They get the feeling of security that comes with knowing the bio passport will catch any of their riders silly enough to put their hands in the cookie jar. And they get the feeling of satisfaction knowing that dopers no longer sleep easy at night, not with the knowledge that the UCI’s Bulldog Drummonds are hot on their trail.

So much for the teams. What do race organisers get for their CADF contribution? Well, as we saw last time out, beyond the WorldTour, they get an absolute bargain, with their contribution not even covering the cost of a single doping control.

The CADF contribution is not the only fee levied upon race organisers by the UCI. They must also pay in order to appear on the UCI’s calendar of events. And the amount they pay varies depending on how their event is rated. Organisers of WorldTour races must pay UCI fees of €24,000 for a one-day race or €3,450 per racing day for stage races. The Grand Tour organisers pay more: €4,700 per racing day at the Vuelta a España and the Giro d’Italia and €5,000 per racing day at the Tour de France.

For races elsewhere on the calendar, the fee varies from €121 for a one-day men’s or women’s race to €2,100 for an HC classed one-dayer. For stage races, the fees range from €168 per racing day to €1,050. (Again, discounts are offered for races in developing territories, ranging from 40% to 60%.)

What do race organisers get for their licence fees? Beyond having their races evaluated by the UCI’s bean counters, the fee includes (and here we’ll quote from the UCI) “allowances (expenses and travel) for Officials (International Commissaires, Doping Control Officers, Classifiers and Technical Delegates) appointed by the UCI and enrolment fee for each race on the international calendar. The accommodation expenses (room + breakfast) remain payable by each organiser.”

Okay. All of that is rather abstract at this stage, isn’t it? How about we consider the fees paid by the WorldTour races? We’re already familiar with their CADF contribution, time to see what else the UCI demands of them.

I’ve included minimum prize money for no reason other than to give you an idea of the scale of the problem faced by organisers of a WorldTour event, that on top of the fees you would expect (team travel and accommodation costs, paying the police, paying for road closures, insurance, race marshals, publicity etc) stepping up to the big league requires a deepening of your pockets.

Take, as an example, our good friend the GP Ouest France-Plouay. At this stage, the organisers of that race are probably regretting the day they ever accepted the UCI’s gift of €30,000 from the ProTour reserve, the amount of times we’ve referred to it, but it helps explain a problem faced by race organisers.

What was the GP Ouest France-Plouay before becoming a WorldTour event? I could check, but I’ll presume it was HC, that being the next step down the ladder. As a HC event, it would have had minimum prize money of €18,000 (compared with €40,000 as a WT event). It would have had a CADF contribution of €100 (compared with €6,000 as a WT event). It would have had a calendar fee of €2,100 (compared with €16,000 as a WT event). And there wouldn’t have been a registration fee (compared with the €8,000 due as a WT event). A little bit of mental arithmetic tells me that stepping up from a HC event to a WT event has cost the Plouay organisers the thick end of €50,000. What has really changed at Plouay?

Let’s look a bit beyond the WorldTour. Having previously looked at ASO’s stable of events, let’s see what the UCI takes out of them in fees and levies.

All very interesting, says you, but what has any of this got to do with the issue of revenue sharing? Well, this is revenue sharing, this is race organisers sharing their revenue with the UCI.

Here’s a question: are the amounts being levied upon teams and race organisers by the UCI fair? To answer that question, you have to address the question I posed when considering the UCI’s balance sheet: what is the UCI there to do and how much money does it really need to do it? If you believe, for instance, that the UCI has a training role, then race organisers and teams should obviously be levied a fee to help the UCI meet its training commitments (if you do believe that the UCI has a training role, then you might want to ask why the UCI hold only a 0.32% stake in CMC, the world cycling centre, which seems to have had the UCI’s training role delegated to it). Answer the question as to what the UCI is there to do, and then you can decide whether the amounts shown above are fair.

The other side of these fees is this: every euro the organisers pay over to the UCI is a euro the race organisers can’t share with the teams. These race organisation expenses are, I think, the sort the AIGCP would like us to consider when pondering the revenue-sharing question (unlike, say, the teams’ travel and accommodation costs picked up by race organisers, which the AIGCP would prefer we just ignored). Unlike other expenses faced by, say, the Tour, it isn’t easy to bring on an official partner to pick up the tab for these expenses and turn them from a cost centre into a revenue source. These expenses must be paid for out of general revenue. Out of, say, TV revenue. TV revenue which the AIGCP would like to claim as being due to the teams.

Next: The Holy Grail – TV revenues.

Previous: Sharing the cost of policing cycling’s doping problem.

WorldTour race organisers must contribute an amount equal to 15% of minimum prize money to the CADF as their contribution toward the cost of cycling’s anti-doping efforts. Every euro contributed by the race organisers towards the cost of anti-doping is a euro for which others sharing the cost of anti-doping don’t have to pick up the tab. Which leaves them free to spend that euro as they please. Every euro that the race organisers spend on anti-doping is also a euro which they cannot pay out to the teams. The race organisers’ CADF contributions should therefore be seen as an indirect form of revenue sharing.

With that thought in mind, let’s consider how much of the cost of anti-doping the race organisers currently share. As we saw last time out, minimum prize money for WorldTour events varies. For the five monuments – Milano-San Remo, Paris-Roubaix, the Ronde van Vlaanderen, Liège-Bastogne-Liège and the Giro di Lombardia – it’s €50,000 per race.

The other one-day races on the WorldTour calendar – Gent-Wevelgem, the Amstel Gold Race, the Flèche Wallonne, the Clásica San Sebastian, Vattenfall Cyclassics, GP Ouest France-Plouay, GP UCI  Cyclist Québec, and the GP UCI Cycliste Montreal – have minimum prize money of €40,000 each.

For the shorter stage races making up the WorldTour calendar – the Tour Down Under, Paris-Nice, Tirreno-Adriatico, the Vuelta al Pais Vasco, the Tour de Romandie, the Volta Ciclista a Catalunya, the Critérium du Dauphiné, the Tour de Suisse, the Tour de Pologne, the Eneco Tour, and the Tour of Beijing – minimum prize money is set at €10,000 per stage plus half that again for GC, or €15,000 per racing day (e.g., a six-day WorldTour stage race has minimum prize money of €90,000).

For the Grand Tours, the minimum prize money is €850,000 each for the Giro d’Italia and the Vuelta a España, and for the Tour de France it’s €1,000,000.

To turn those numbers into the organisers’ contribution to the CADF, multiply them by 15%. Doing that, we learn that the organisers of the Monuments each pay €7,500 to the CADF, the organisers of the other WorldTour one-day races €6,000 per race, and the organisers of WorldTour stage races pay €2,250 per racing day (e.g., €13,500 for a six-day stage race). The Giro and the Vuelta toss €127,500 each to into the pot, the Tour €150,000.

To complicate the matter somewhat, from last year, the GT organisers must also cover the cost of pre-race out-of-competition tests. The UCI’s 2010 accounts give a figure of 709,830 Swiss francs for that. Call that €190,000 per GT, bringing the Tour’s total CADF contribution up to €340,000

The sum of €340,000 from the Tour de France, it doesn’t look too bad, does it? Try this number then: €120,000. That’s the amount every ProTeam is required to contribute to the CADF. The Tour de France sits at the centre of the cycling world. For too many people, it is cycling. Yet the Tour de France coughs up less than the combined contribution of three ProTour teams to cover the cost of solving cycling’s doping problem? Think about that – Garmin-Cervélo, HTC-Highroad and BMC between them contribute more toward the cost of anti-doping than the Tour de France does.

ASO’s total CADF contribution

That, of course, is an unfair comparison. The teams are competing all year around and the Tour lasts just three weeks. Why then don’t we look at ASO’s total contribution to the CADF?

If we’re going to consider ASO’s total contribution to the cost of anti-doping, don’t you think it would be fair to consider the total contribution to the cost of anti-doping borne by teams? Consider Garmin-Cervélo. On top of the €120,000 levied upon them by the UCI, they fund their own independent anti-doping programme. The best estimate for the cost of that is about €375,000. Which brings their total anti-doping spend to just shy of half a million euros.

Thor Hushovd enters anti-doping control at the 2011 Tour de France (AFP PHOTO / PASCAL PAVANI )

Yup, that’s right folks: in total, ASO spend less on anti-doping than Garmin-Cervélo do. At some of their races, ASO are not even chipping in enough to pay for a single dope test. Seriously. The average cost of an anti-doping test is about €300. That’s not a very scientific figure, not all tests are the same and so not all tests cost the same but, as a simple average, it’ll do for our purposes here. €300. For just one test. Compare that with the €100 contributed toward to cost of anti-doping by the Critérium International. Or the €30 at the Ladies Tour of Qatar. Beyond the WorldTour races organised by ASO, the Amaurys really are getting a bargain when it comes to policing doping.

The World Tour’s CADF contribution

How does the half million or so euros spent by Garmin-Cervélo on anti-doping compare with the contribution of all the WorldTour races to cycling’s anti-doping costs?

Hands up, please, those impressed with those figures?

The big picture

Let’s move this up to the big picture. In 2010, the CADF raised 7.9 million Swiss francs from the teams, riders, organisers and the UCI. This compared with 8.2 million the year before. Let’s look at who contributed what:

The teams in total bear 59% of the cost of anti-doping, compared with the 21% borne by the race organisers. That seems unfair, but look at what the position was in 2009: the teams were shouldering 66% of the burden and the race organisers just 13%. Look closely at those figures though: the contribution made by the ProTour teams has actually risen, from 37% to 40%. The saving produced by making the Grand Tour organisers cover the cost of pre-race doping controls have been passed not to the ProTeams, who make up the majority of the Grand Tour peloton, but to the ProConti teams.

The shift in the burden of anti-doping costs between 2009 and 2010 might leave you thinking that we’ve reached a fair balance in the way the burden is borne, at least between the teams and the organisers in general (sharing the burden between the individual teams is a different debate). The race organisers have shouldered more of the burden, the teams have been freed of some of the burden. The teams are still required to spend nearly €3 for every €1 spent by the race organisers but compared with the €5 they had to spend in 2009, that’s an improvement. But are the race organisers now really bearing their fair share?

Go back to the table of ASO races. The Tour of Oman chips in just €210 toward anti-doping. The Critérium International just €100. Paris-Tours just €100. Once you step out of the twenty-seven WorldTour events, race organisers are contributing next to nothing to solving cycling’s doping problem. Think about this: twenty-seven races pick up the tab for more than 90% of the race organisers’ contribution to anti-doping. Three races – the Grand Tours – contribute more than two-thirds of the race organisers’ total share of anti-doping costs. ASO alone contribute nearly one third of the total contribution made by all race organisers.

Solve the manner in which cycling’s anti-doping costs are shared – between the teams and the organisers, among the teams themselves and also among the race organisers – and you will have gone some of the way toward solving the problem of revenue sharing.

Next: Sharing the revenue with the UCI.

Previous: Sharing the wealth at the WorldTour.

Tour of Qatar (photo: REUTERS/Fadi Al-Assaad)

Last time out we looked at the prize funds on offer at ASO’s races and discovered that only four ASO races – the Tour de France, the Tour of Oman, the Tour of Qatar and the Ladies Tour of Qatar – offer team prizes. Time now to turn to what is happening in the WorldTour as a whole.

The first thing you will notice in the above table is that it is incomplete. (So much for research, eh?) Of the 27 WorldTour races, I don’t have prize figures for 10 of them. Prize funds are not covered by the official secrets act. It should be easy to find out how much each race pays out. In fact, you would think most races would want to boast about their generosity, no? For a lot of races – particularly ASO’s – finding the information is easy, it’s just a click away on their websites. For other races though … oh dear.

For those races I couldn’t find the information I was looking for – either on the race’s website, or elsewhere on the net – I emailed the race organisers. Out of about a dozen-and-a-half emails I sent, only two race organisers could be bothered enough to reply. And one of them is still trying to find the information for me. (If any of you want to help fill in the blanks, you can find me on Twitter @fmk_RoI.)

So, my poor research skills aside, what is there to say of the races for which information is available? As per last time out, these figures are before considering participation allowances. If getting basic prize fund information isn’t easy, you can imagine the difficulty in getting participation allowances. The information I have though is that, the Grand Tours aside, only the Tour Down Under and the Tour of Beijing are paying more than the UCI-mandated €7,500 participation allowance (the actual amounts being paid by the Tour Down Under and the Tour of Beijing I don’t have, but it’s somewhere between $20,000 and $40,000 per team).

My real interest here is again in that portion of their prize funds race organisers set aside for teams. Of the above races for which I do have information, just five pay out team prizes: Tierreno-Adriatico (€11,000), the Giro (€118,340), the Tour (€201,000), the Eneco Tour (€1,000) and the Vuelta (€52,000). The Tour we’ve already covered, when looking at ASO’s races. The Giro and the Vuelta, you would expect them to pay team prizes. That Tierreno-Adriatico pays team prizes is not entirely unexpected, given its placement on the calendar. That the Eneco Tour is the only other race paying out a team prize is a surprise. (Again, it’s necessary to stress that there are ten WorldTour race organisers who couldn’t be bothered answering a simple question about how much they pay out in prizes. Some of them may, and probably do, pay team prizes.)

So let’s go back to the question I left hanging last time out: should ASO pay out more to the participating teams? The knee-jerk response is obviously yes. But let’s not be jerks. Rather, we should note that the Tour is already paying out considerably more than its nearest rival, and that ASO are, generally, more generous than most all of their rivals. Rather than demanding more from ASO, shouldn’t the AIGCP be doing more to level the playing field among all the race organisers, make the other races pay out more first?

But what if those other races can’t afford to pay out more? Anecdotal evidence tells us that the Tour de France makes a profit, as does Paris-Roubaix. The tours in Qatar and Oman have rich sugar-daddies. The profitability of the other races is open to question. My own opinion – and it is just that, an opinion – is that ASO is not a charity and would not be running races if there wasn’t a profit in it.

But what of others? Take the GP Ouest France-Plouay. Out of the generosity of their hearts, the good men and women in Aigle who ruin this sport kindly allocated €30,000 from the ProTour reserve to the GP Ouest France-Plouay in 2010, to help meet the increased costs of being on the WorldTour calendar (most of which costs go back into the pocket of the UCI – it’s just like giving aid to Africa, really). Making races pay their way is never easy, as all of us who have been involved in organising them at any level can attest. (It’s also worth recalling that the good men and women in Aigle have also generously used the ProTour reserve to sub Global Cycling Promotions €445,000 in 2010 and €177,000 in 2009. Given that GCP organises just one race, you might see that as a subvention to the Tour of Beijing.)

Does the failure to pay out team prizes mean that those races that don’t can’t afford the extra prize money? Possibly. But, as we saw last time out, even at ASO’s races there’s only four paying team prizes. So how about we consider the size of the overall prize fund and see what that tells us? The UCI sets a minimum prize money figure for different races, which covers stages and GC. Comparing how far ahead of the minimum different races are might offer some guidance as to how flush with cash they are.

Let’s do this in two stages, the first looking just at ASO races, the second looking at WorldTour races.

What’s interesting here is that there are only three races at which ASO pay the absolute minimum prize money: the Flèche Wallonne Femmes, Paris-Tours Espoirs, and the Critérium du Dauphiné. Of the last, it’s worth remembering that ASO only took over the race last year. So while they can afford to find extra money for riders at most all of their races, they can only afford to find money to reward the teams at four of them. If you were writing their end of term school report, you’d be inclined to put ‘could try harder’ at the bottom of it.

At the WorldTour races, the picture looks like this:

Of the WorldTour races for which I have information, you can see that 11 are paying above minimum prize money (and almost half of them are ASO events). But remember, just 5 of the above races (for which I have information) pay out team prizes.

There’s a point I’d like to introduce here, but for which I don’t have detailed information. Someone else will pick it up and run with it, perhaps. The point is this:  increasingly, race organisers are turning to cyclo-sportifs to help boost their bottom line. Consider the list of World Tour races above and the number of them that have associated cyclo-sportifs. Cyclo-sportifs which feed off pro races. It is easy for some race organisers to put on the poor mouth and argue that they are barely covering their costs in organising pro races. It’s even easier to use accouning sleights of hand to prove this should anyone ever look hard enough. But if race organisers are making money off the back of those races via a cyclo-sporif, then some of that money should, I think, feed back into the pro race. And from there back to the teams (and riders) who make that race popular.

Does any of this help answer the question as to whether the playing field among all the race organisers can be levelled, whether other race organisers should also be called upon to pay out more to the teams? Even without the cyclo-sportif point, I think it does, and that the answer is yes. If race organisers can afford to be generous to the riders, they can afford to be generous to the teams. Even if that means they have to be less generous to the riders. That’s just my opinion, and you’re welcome to disagree with it. And, by the end of the week and the conclusion of this series, I may be disagreeing with it myself.

Focusing the revenue-sharing debate on the richest race on the calendar is obviously the easy thing for the AIGCP to do; it is the story that will gain them the most publicity. But, if you were in ASO and the AIGCP were trying to embarrass you into giving them more crumbs from the table, don’t you think that you’d tell them to get other race organisers to improve their act first? Or maybe you’d want to tell them that, rather than using the media to demand meetings with Marie-Odile Amaury (bypassing the head of ASO, her son, Jean-Étienne Amaury, which is a bit like saying ‘I’ll tell your ma’ when the big boys won’t let you play with them) they should take their problem to the UCI and get them to set minimum prize money for teams and not just for riders?

Next: The CADF and the sharing of costs between teams and race organisers.

Previous: Revenue sharing at ASO races.

From the beginning, the Tour de France has shared its revenue with the participating riders and teams.  At that first Tour, away back in 1903, riders were competing for a prize pool of 20,000 French francs, with the winner pocketing 3,000. In addition, L’Auto subbed the riders five French francs per day. Over the years, the manner in which the Tour has subsidised the cost of participation has changed. And the prize fund has grown. And grown. And grown. Want to see how much it’s grown? Try the chart below.

 Figure 1: Tour de France Prize Fund, 1903 to 2011
(k = thousands, m = millions)
Source: ASO

Because we’re dealing with three different currencies here (pre-1960 French francs, post-1960 French francs and, today, euros) I’ve had to convert everything into a common currency. Because the growth in the prize fund in the first forty or so years is somewhat lost, that’s covered in the inset chart.

The issue of revenue sharing, as raised during the Summer by the AIGCP, is about sharing money with the teams, not the riders. The Tour’s prize fund though – generous and all as it seems – shares ASO’s wealth with both teams and riders. While I realise that riders deserve to be well-paid for what they do, and deserve to have a generous prize fund to compete for, right now I want to ignore the issue of sharing the wealth with riders. Cervélo’s Gerard Vroomen has recently addressed the issue of sharing the wealth with riders at all levels of the sport through a minimum wage. His views are worth considering and taking on board as part of the whole revenue-sharing debate. For me, the issue of riders’ salaries, bonuses and winnings is an area I have mixed views and insufficient information on so, insofar as it relates to the upper echelons of this sport, I’m keeping well out of it. Call me a coward but I’m with Roger McGough on this: discretion is the better part of Valerie.

For me, what’s interesting about the Tour’s prize fund is how much of it feeds back into the budgets of the teams compared with how much goes into the bank accounts of the riders and their agents. This is the aspect of the prize fund that relates to the revenue sharing debate as it has been framed by the AIGCP.

Some of you will have seen the table (right) breaking down the 2011 Tour’s prize money between the different teams. Cadel Evans’ BMC Racing Team topped the table with an impressive €493,990 while Johan Bruyneel’s Team Radioshack were rooted to the bottom with a paltry €10,540. But how much of that actually went to the teams and how much of it went to the riders?

The original table included the overall team prize (€120,000), the team time trial (€25,000) and the sums won by the teams of each of the stage winners (€56,000). If we apportion that €201,000 to the correct teams, subtract the resulting figures from the original set of numbers then we should have the figures for how much the teams got and how much the riders got out of the 2011 Tour.

Except we don’t. If you look at the table you’ll see it accounts for just over €2 million of prizes. Yet ASO claimed that the total prize fund for the Tour was €3.4 million. What happened to the missing million and a lot?

Here’s where ASO play a smoke and mirrors trick on the media. Their total prize fund of €3.4 million includes fees negotiated between the AIGCP and ASO for their participation. Yes, at the Tour, you get a ‘prize’ just for turning up. Just like school sports day.

At the Tour, each team receives a €51,243 participation allowance. In addition, teams finishing with seven or more riders (out of the nine that started) get a bonus of €1,600 per rider. So the worst performing team can take home an additional €51,243, while a team finishing all nine of its riders will ride away with €65,643. So let’s add those two figures into the mix and see what the final picture looks like:

The key point here isn’t that Garmin-Cervélo came out of the Tour with eighty grand more than the oil-rich oligarchs in Katusha did (although that is a nice point). It’s that, of the €3.4 million ASO shared with riders and teams, only €1.6 million went toward helping to defray the costs of running the teams. As splits go, it doesn’t seem to be that bad, at 46:54. But it’s the teams who are the ones spending the money on fancy team buses and the like, not the riders.

How does the €1.6 million of the Tour’s revenue shared with the teams this year compare with previous editions of the race? Let’s look back over the past four years:

The sharp-eyed among you will have noticed a slight difference between the numbers given here for 2011 and the numbers given previously. Simple answer: these are pre-race budgeted numbers, using guesstimates for the number of finishers, which impacts the final figures for some prizes and allowances.

The important point to note is that the only real difference in the revenue shared with the teams over the last four years has been because of the number of teams participating and the inclusion (or not) of a team time trial in the race. The base numbers – a €51,243 participation allowance, €1,600 per rider for teams finishing seven or more riders, €2,800 per stage, €120,000 for the team classification and €25,000 for the team trial – have been static.

Could ASO do better? Should ASO do better?

Before answering those questions, I think it’s necessary to consider what else ASO is already doing. The Tour is but one of a stable of races they control. While it is central to the cycling calendar and is loved by one and all, the Tour does unfortunately act as a distorting glass, warping our perception of what’s going on elsewhere in our sport. So what is happening elsewhere within ASO’s stable of races?.

This time round, for the Tour de France, I’ve excluded the participation allowance and finishers’ bonus as the comparative figures for other races are not available and we really should compare like with like. On the issue of participation allowances, the UCI sets a minimum of €7,500 (per team, per race) to be paid to all ProTeams participating in WorldTour (WT) races, excluding the Grand Tours: for other teams and other races, the figure is to be negotiated with the event organiser. When I asked the AIGCP if figures were available for fees negotiated at other races, I was told that – with the exception of the Grand Tours and a couple of other races – they receive only the UCI minimum. €7,500. Whether it’s a stage race or a one-dayer.

A factor you need to consider with regard to the participation allowance is the costs picked up by ASO, principally accommodation. Back in the day, that five French francs per diem the Tour allowed riders in 1903 was just that, a per diem. The riders had to sort out their own accommodation. As the years went by, that’s an expense for which the Tour itself started to pick up the tab. For a time, the race organisers tried to cover it by hiking up the amount charged to enter the race, rising from 10 French francs per rider back in 1903 to something in the region of £25,000 (circa 125,000 French francs) by the mid-eighties. Today, there is no direct fee for entering the race.

Some of the costs assumed by the race, though. have actually become a source of revenue for the Tour. Away back in the eighties, one Tour anecdote has it, Félix Lévitan was shocked to see Colombian riders queuing for payphones, their pockets bulging with centimes so that they could phone home to Colombia. Lévitan issued an edict that, henceforth, all riders’ hotel rooms should have a telephone. Soon enough the Tour brought on an official partner who paid for the privilege of being the Tour’s telecommunications provider.

Digressing a little into the Tour’s history, another story is worth telling in relation to this aspect of the race’s finances. In 1989 Jean-Pierre Courcol – having stepped down as Tour director after the Delgado affaire – took a long hard look at the way the Tour provided transport. Peugeot provided official vehicles. Courcol thought they should pay for the honour. Jean Todt – now head of the sport some in cycling want us to model ourselves on, F1 – thought Courcol was joking. He offered 500,000 French francs. FiatFrance could see that Courcol was being deadly serious. They bid 6,000,000 French francs. And got the gig. Once the Tour’s organisers caught the official partner bug they exploited it for every centime it was worth. And then some.

No figures are available for the costs assumed by ASO today – or the revenues they pull into to mitigate them – but you don’t need to be a math wizard to work out that just putting 22 teams up in hotels for more than three weeks doesn’t come cheap. This alone is one of the reasons some towns and cities are willing to pay such large amounts for the privilege of hosting the Tour: a lot of the money immediately flows back into the local economy. One estimate has it that the average spend is in the region of €150 to €200 a head. Multiply that by three thousand or so people (riders, team personnel, organisers and media) and then add in something for the thousands of fans who also spend money while following the race and the cost of hosting the Tour doesn’t seem so expensive, does it?

The issue of the extra costs borne by ASO is also one of the reasons why the revenue-sharing debate is, in my opinion, poorly framed: you can’t consider revenue without considering the costs associated with it. Some of those costs – and who is levying them – we will come to later in this series.

Back to the issue of prizes at ASO races then. There are a few things interesting in the table of prizes, such as the pathetic sums on offer at the two races ASO organises for the women’s peloton. But, again, what I’m interested in here is the issue of team prizes. The Tour apart, they’re offered at just three other races in the above table: the Tour of Oman (€5,100), the Tour of Qatar (€5,100) and the Ladies’ Tour of Qatar (€1,850). All the rest of the prize money in all the other ASO races flows directly to the riders (or, to be precise, the riders and the team personnel amongst whom the pooled prize money is shared).

Just four ASO races offering team prizes. Just one ASO race paying more than the UCI-approved minimum participation allowance. Doesn’t seem like much, does it? So let’s ask the question again: can ASO do better? Me, I think they can. Cycling is a team sport and the teams deserve to be rewarded for their efforts. Not all the glory – or all the wealth – should go to the riders.

But should ASO do better? To answer that question I think it’s worth considering the prize money on offer at some other races. ASO might be the biggest race organiser out there. But they’re not the only one. And, if we’re going to ask them to do something, we should also be asking the same of other race organisers.

Next: Sharing the wealth at the WorldTour.

Previous: Monitoring the UCI’s cholesterol levels.

Let’s go back to the beginning. The Tour de France was originally just one of more than a dozen sporting stunts announced by L’Auto in early 1903, all with the express purpose of boosting the newspaper’s circulation. In this the Tour was remarkably successful. From a low of 20,000 L’Auto‘s circulation shot up to 65,000 during the first Tour. Le Vélo, the newspaper which L’Auto had been created to rival, was driven out of business in 1904. Within a decade L’Auto‘s circulation was touching 320,000 during the Tour.

During the first world war, with its pagination reduced to just two pages and Henri Desgrange himself away from the farm, earning a Croix de Guerre as a volunteer infantryman, L’Auto‘s circulation slipped to just 22,000. Post-war, this climbed to 162,000 in 1920. Throughout the ‘twenties L’Auto‘s circulation roared, climbing to 298,000 copies generally and topping out at 650,000 during the Tour in 1930. In 1933, circulation peaked, hitting 364,000 copies generally and touching 730,000 during the Tour.

Then came the decline. By 1938 L’Auto‘s circulation had fallen to 200,000. Not through lack of interest in the Tour: quite the reverse. The Tour had become so popular that L’Auto‘s rivals were giving it their whole-hearted support. They too were getting a large benefit from L’Auto‘s hard work.

Henri Desgrange had tried to tread a delicate line on this issue. Initially, in 1903, when Le Vélo tried to ignore the Tour in the hope that it and its sponsoring newspaper would go away, he complained bitterly. Then, when the race began to boom and L’Auto‘s circulation began to soar, Desgrange tried to block other papers from covering his race. It took him until 1922 to admit defeat and allow rival journalists to follow the Tour. A caravan of fifteen press cars was soon in pursuit of the peloton, five of them belonging to L’Auto.

By the second half of the thirties Paris-Soir – a general interest newspaper – were putting a team of forty journalists on the Tour, supported by two planes, five cars, five motorcycles and a bus. Better still, Paris-Soir, being an evening newspaper, were able to beat L’Auto to the punch by producing an edition of their paper that carried all the news from that day’s racing. Readers of L’Auto, on the other hand, had to wait until the following morning to discover how the race was unfolding.

It wasn’t just rival newspapers that were numbing the effect of L’Auto‘s circulation-boosting stunt. Radio soon discovered the joys of the race. The Tour became a multi-media event and fewer and fewer people relied upon L’Auto to tell them how it was unfolding.

With the arrival of Émilien Amaury in the 1940s, a new order went out: the Tour was no longer to be treated as just a circulation-boosting stunt for his own Le Parisien Libéré and Jacques Goddet’s L’Équipe. The Tour had to grow up and start paying its own way. While revenues from the race did increase over the next two decades, so too did its costs. It wasn’t until 1974 – according to Félix Lévitan – that the Tour started to turn a profit. Think about that a moment: for its first seventy years the Tour didn’t pay its own way. Talk about children refusing to grow up and stop living off their parents, eh?

Let’s jump forward in time. What impact do you think the Tour has on L’Équipe‘s circulation today? Would you be correct in assuming that every July, L’Équipe sees its sales peak? If that’s the case, you’d be wrong.

Fig 1: Combined monthly sales of L’Équipe & L’Équipe Dimanche, 2005-2010 (millions)
Source – OJD

Only once in the last six years has L’Équipe‘s total sales peaked in July. In 2006. Floyd Landis, eh, what a guy? Uum, no. Chapeau instead to Zinedine Zidane and the French World Cup squad.

If the Tour is no longer about selling more newspapers then, what is it about? Well, let’s zip back to the seventies again. In 1973, the Tour was put into the hands of La Société d’Exploitation du Tour de France (the ‘exploitation’ part –wisely – being dropped in 1980). The following year the race turned its first profit. How? Principally through the generosity of host towns.

In 1974, Lévitan was able to squeeze 1,800,000 French francs out of Brittany’s market gardeners and vegetable growers in return for granting them the Tour’s grand départ (some perspective for you: the Tour’s total prize-fund that year was 802,650 French francs). In return for their barrow full of French francs, Brittany’s market gardeners got the prologue and two stages of the 1974 Tour. A third stage – up and down a dual-carriageway in England – was paid for by the operators of a ferry service between Roscoff and Plymouth. The money these opening stages generated was a coup for Lévitan but the racing was, at best, anaemic (of the English stage, the wags at the Daily Mirror were prompted to run the headline ‘Can Forty Million Frenchmen Be Wrong?’). But at that point it was the money that mattered the most.

Towns, cities, whole départments had been paying for the privilege of hosting the Tour for years, providing an important source of revenue for the race organisers. It was Lévitan’s job to squeeze every last centime out of them. And this was something he was the Mr Kipling of finance at: exceedingly good. As he demonstrated in 1974. And continued to demonstrate until his ouster in 1987.

The cost of hosting the Tour has risen as the years have gone by. In 1977 Rennes paid 200,000 French francs for the privilege. According to the-then Mayor, the town “saw the riders for ten minutes and the publicity caravan for three hours.” Almost thirty years later – 2006 – Rennes had to pay €76,000 to host the Tour again, roughly the equivalent of 500,000 French francs.

By the time the Tour came to Ireland in 1998 the cost of hosting a foreign grand départ was something in the region of 5 million French francs. Less than a decade later London coughed up €1.5 million – call it 10 million French francs and you wouldn’t be far wrong – for the 2007 grand départ.

The Tour has other income sources, such as jersey sponsors and the publicity caravan. Important as all these are to the financial well-being of the race, their contribution to the Tour’s coffers is dwarfed by the men who really control the Tour today: the television companies.

The modern Tour is inceasingly a televisual event. And he who pays the piper calls the tune. As France Télévisions demonstrated when they summoned Pat McQuaid to a meeting some years back and told him that race radios were killing the Tour and had to go. With plans for his own races, and the need to sell their media rights for as high a price as possible, McQuaid did his best Michael Flatley impression for the executives at France Télévisions.

It is on the Tour’s television rights that the revenue-sharing debate has recently focused. Quite how big those rights really are we’ll come to later in this series. For now it is sufficient to note that putting a value on them is not straightforward.  Putting any values on the Tour’s revenues and expenses – on its profits – is not easy. While the Société du Tour de France used to file annual accounts, once the race fell under the control of ASO in the early nineties a shroud was pulled over the race’s profitability.

With the Tour’s finances under a shroud, attention shifts to ASO itself. Since the creation of ASO new events have been added to the Amaury’s sporting empire. In 1998 ASO acquired the Marathon de Paris, previously the property of Stade Française. In 2002, they acquired Paris-Nice and created the Tour of Qatar. In 2003 they added l’Open de Golf de France to their stable of events.

In that year – 2003 – out of a total 117 days of sport organised by ASO, 74 of them were cycling (motor sports accounted for 21, golf 16, equestrianism 4, and athletics 2). In total, cycling contributed 70% of the company’s revenue (motor sports accounted for 21%, athletics 4%, golf 4%, and equestrianism 1%). ASO’s total income – somewhere between €110 million and €120 million – was split between TV rights (44%), marketing (39%), competitors’ rights (12%), and local communities (5%).

In 2004 the Rencontres Internationales des Disciplines Équestres (RAID) was added to ASO’s roster. They also added the Paris-Dakar. In 2008 they took a 49% stake in Unipublic, organisers of the Vuelta a España. The following year a partnership was announced with the organisers of the Tour of California. The next year they liberated the Critérium du Dauphiné Libéré from its previous owner. All of these acquisitions – and the various ones not listed here – have had an impact on ASO’s revenue and profitability.

Last year, the cycling world finally decided to shine a light on ASO’s revenues and profits. Someone released a set of numbers showing a jump in ASO’s revenue between 2008 and 2009 of €24 million and a profit of €32 million. Many leapt to the conclusion that all of this was down to the Tour de France. Then, heaping foolishness upon foolishness, they credited it all to the unretiring Lance Armstrong. John Wilcockson and VeloNews treated those claims with the scorn they deserved, going back to 2002 to show the true picture.

Figure 2: ASO Revenues and Profits, 2002-2009.
Source – VeloNews / ASO accounts

The big drop in revenues in 2008, Wilcockson explained, was down to the last-minute cancellation of the Dakar. When the Dakar returned in 2009, so did the revenue. Or most of it. That ASO’s revenue in 2009 was less than the figure for 2007 is telling: the world of sport is as credit-crunched as the rest of the global economy.

The numbers shown in the chart above are central to the revenue-sharing debate. While the debate has, so far, focused on the alleged $200 million of TV revenue generated by the Tour, the real argument is about getting ASO to share more of the total wealth cycling generates for the Amaurys. Instead of feeding back into the pockets of the Amaurys (and Arnaud Lagardère) the teams would like to see more of the wealth feeding back into their pockets.

How wealthy are the Amaurys? The question may not seem relevant to cycling’s revenue-sharing debate, not when you consider the full scope of the Amaurys’ empire (see An Empire at the Crossroads, part 4 of this series). But it is worth considering if only to realise what’s in this for the Amaurys and why they didn’t simply accept Arnaud Lagardère’s offer last year to take the whole kit and caboodle off their hands.

Connections magazine in France produces a French rich list. As with all rich lists a certain amount of salt should be pinched when you consider these numbers. Numbers are plucked out of thin air and estimates are heaped upon estimates to arrive at a final figure. Most rich lists are just fun colour pieces, not to be relied upon. With that caveat in mind, here’s how the family’s wealth has been estimated over the last few years:

Figure 3: Amaury Family Wealth, 2004-2011.
Source – Connections

Most of you will have noticed the big drop in the family’s wealth between 2007 and 2008, from €450 million to €228 million. You will remember that the patriarch of the clan, Philippe Amaury, died in 2006. Death duties on his estate presumably wiped out a lot of the family’s fortunes. But unlike the situation when he finally secured his inheritance in 1983 – when he had to sell a quarter stake in the empire to Arnaud Lagardère’s father – this time around the surviving Amaury’s had enough reserves to be able to pay the state its dues without having to cede more control of their empire.

The Amaurys were not without offers of help after Philippe Amaury’s death. Some people just like to be nice and help someone out when they find themselves in troubled times. Charitable sorts, some people are. Ever eager to lend a helping hand. That the Amaurys refused these offers of aid is worth remembering. Having refused to sell the family silver when they were at their lowest ebb, and having refused other offers since, it’s hard to see the Amaurys simply walking away from the family business today. Not without a fight. Or a very, very generous offer.

It is equally hard to see them giving in easily to the entreaties of the AIGCP that the pocket money paid to the teams should be increased at the cost of ASO’s profitability. Not without the AIGCP offering to do something nice for the Amaurys in return. Is the AIGCP’s promise to spend more money on anti-doping sufficiently nice? Or would the Amaurys be skeptical of such a pledge and want to protect the teams from themselves and their tendency to out-bid one another in their quest for the shiniest riders in the shop window? Only time will tell.

Previously: The man who would be king.

Next: The UCI’s role in the revenue-sharing debate.