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In 1930, a non-appearance fee was paid by the Giro organisers. Alfredo Binda had by then established a stranglehold on the corsa rosa, winning in 1925, 1927, 1928 and 1929, in all of them riding for Legnano. It wasn’t just that Binda kept winning, it was the manner of his victories. In 1927 he had won twelve of the fifteen stages, in 1928 seven of twelve and 1929 nine of fourteen. In all, that’s thirty-three out of forty-one stages in three years. Giro boss Emilio Colombo was getting more than a little bit bored by il campionissimo. More to the point, La Gazzetta dello Sport‘s readers were getting bored by il campionissimo: circulation was down. So a plan was hatched between Colombo and his sidekick Armando Cougnet on one side and Legnano owner Emilio Bozzi and his direttore sportivo, Eberardo Pavesi, on the other: Binda would be politely asked to bugger off.

Alfredo Binda (Source: Cycling Hall of Fame)

Bozzi was willing to play ball because Binda taking a dive made commercial sense: another Binda victory wasn’t go to help sell many more bikes. But, at the same time, Bozzi didn’t want to simply surrender and allow Maino or Atala or Bianchi to step in and bag an easy victory. Here Pavesi came to Bozzi’s assistance, promising that he had a talented young rider waiting in the wings who could, quite possibly, profit from the absence of Binda. Pavesi was also concerned that Binda was having life just a little too easy, and had stopped taking cycling as seriously as he should be (or, at least, as seriously as Pavesi thought he should be).

With everyone else on board, it was time to pitch the deal to Binda. He listened to what was being told to him. And he agreed that yes, he was strangling the Giro and that yes, that was unfortunate. It would be best if he stayed away. You can imagine the sigh of relief this must have elicited. Only then Binda delivered an upper cut of sheer elegance. He demanded that, if Colombo really wanted him to stay away, he’d have to pay a non-appearance fee: the equivalent of the first prize, plus six stage wins, plus the bonus Bozzi would have had to pay him if he won. All in, the thick end of 22,500 lire. And even there, Binda claimed, he was being exceedingly generous, as failure to win the Giro would cost him a packet on the post-Giro critérium circuit (even then, riders needed the appearance fees paid on the critérium circuit). Colombo swallowed hard but saw he had little or no choice in the matter. The deal was done. Colombo, having stared down the demands for appearance fees in 1924, caved to the demand for a non-appearance fee. Once again commerce triumphed principles.

At which point appearance fees re-enter this story. Up to now Binda hadn’t taken a tilt at the Tour de France, preferring the Giro. It is said that the reason for this was that Legnano had no business interests in France, but this isn’t entirely true: they were there in force in 1924, and Ottavio Bottecchia’s two victories for Automoto demonstrate clearly that the Italian media gave the French Tour ample coverage, so long as one of their own was winning. The main reason Binda hadn’t bothered with the Tour is more likely to have something to do with that post-Giro critérium circuit; having won the corsa rosa and then filled his boots with the round-the-houses races and track appearances, it’s highly unlikely he was ever in much of a state to tackle the Tour. The fact is, few Giro winners had the legs to tackle the Tour, as we’ll see when we come to look at the 1924 Tour itself, which was graced by the presence of the reigning Giro champion Giuseppe Enrici.

The post-Giro critériums sapping Binda’s strength would not, of course, be the case in 1930. So with Binda now sitting out the Giro, and the Tour having just switched to national team format, Henri Desgrange – it’s claimed – saw an opportunity to get the best Italian rider of the day riding in his race. He offered Binda a generous appearance fee to ride the Tour.

It’s said by some that the reason Binda eventually pulled out of the Tour, ten stages in, eleven stages to go, is that he’d bled Desgrange dry and there was simply no more money to pay him to continue. If you look, though, at the 1930 Tour, you see a possible alternative reason: alongside Binda on the Italian team was Maino’s Learco Guerra, a rising star. When the Italian squadra snatched the maillot jaune on the second stage of the race, it was Guerra who wore it, not Binda, who was twelve seconds off yellow and in third place. The hills were yet to come and he was more than capable of clawing back time once the road went upwards. So Binda had nothing to worry about. Until he lost more than an hour after suffering a major mechanical on the road from Bordeaux to Hendaye, just before the race reached the mountains. That was his race for yellow done for. Time for him to turn to consolation prizes.

The next day, Hendaye into Pau, the campionissimo took the stage win. The same again the day after, Pau to Luchon. And on the third day – Luchon to Perpignan – he retired from the race, with his compatriot Guerra having finally surrendered the maillot jaune and eleven minutes to André Leducq. When the race made it back to Paris, Guerra was just fourteen minutes off Leducq’s pace, and stood standing on the second step of the podium.

It took a lot of spinning to explain Binda’s abandonment of the race, especially with his teammate in yellow and in need of support. Hence, perhaps, the legendary stories of Binda having bled Desgrange dry. The Italian cycling federation tried to claim that their campionissimo was saving himself for the Worlds (which, in fairness, he did go on to win). But many, many years later Binda finally offered his own reason: Colombo had welshed on the Giro deal and the agreed 22,500 lire non-appearance fee had failed to materialise. Even so, Binda was still proud of his ‘victory’ in that 1930 Giro, as he explained to Pierre Chany:

It was my best Giro. I didn’t just get the prizes without riding, but I took up about ten contracts on the track in France, Germany and Belgium. The records say I won the Giro five times, but I consider that I won it five and a half times.”

The appearance fees issue was put to rest – sort of – after the war, with the establishment of the Challenge Desgrange-Colombo, a precursor of the old Super Prestige Pernod trophy and today’s World Tour. To encourage the big teams to send their best riders to all the races making up the season-long competition, the organising journals – L’Équipe in France, La Gazzetta dello Sport in Italy and Les Sports and Sportwereld-Het Nieusblad in Belgium – dangled the carrot of generous travelling expenses under the noses of the teams. Today, Pro Teams in the World Tour races are guaranteed a minimum appearance fee of €7,500 each, with the ASO raising that to €51,443 at the Tour de France. The teams don’t think it’s enough and – as in 1924 – are still agitating for more.

The deal hammered out for the Challenge Desgrange-Colombo races clearly wasn’t the end of the issue. The Tour de France may have been able to attract the cream of the peloton, but the two other Grand Tours – the Vuelta a España and the Giro d’Italia – suffered a little in the shadow of other races, especially the Tour. Too often the Giro was used just as a training ride for the Tour, no more important – for some riders – than the Tour de Romandie which itself served as a leg-loosener for the Giro. So sometimes the Giro organisers had to take out the cheque-book and entice the best riders to put in an appearance.

Appearance fees weren’t the only thing that had the Giro organisers reaching for their cheque-book. Sometimes certain riders – certain Italian riders – needed a little bit of help when it came to ensuring that the maglia rosa stayed in Italy. The stories here are legion, although the facts supporting them are few. But it does seem that the Giro organisers paid for the right result on several occasions. (And sometimes they didn’t even pay, they just helped in other ways, such as cancelling stages and turning a blind eye to infringements of the rules.)

Other times, extra money was spent to liven a race up: consider, for instance, the 100,000 wager La Gazzetta‘s Rino Negri had with Roger de Vlaeminck over how many stages he could win at the 1975 Giro. And, of course, the issue of disappearance fees was also on the agenda that year. When Eddy Merckx‘s Molteni squad was pulled from the 1975 corsa rosa just before the start, the official reason given was that Merckx had taken ill at the Tour of Romandie. Some suspected that Vincenzo Torriani, the Giro’s direttore di corsa, had paid the Belgian off. Italy, at this stage, was so bored with the Cannibal’s reign of terror in the Giro – five victories, plus that near victory in 1969 – that RAI had stopped covering the race live. With Merckx gone and Torriani delivering a corker of a race in 1975, RAI returned to the corsa rosa the following year. Whatever money Torriani had spent on that 1975 Giro, it was a wise investment.

Chucking out money to the odd team or rider here or there was relatively easy to do. Paying off everyone in the race is of a different order of magnitude. Especially given the precarious financial position of the Giro and of its organising journal, La Gazzetta dello Sport. Which, in 1977, was taken over by the RCS group. One of the grand ironies of this take-over was that La Gazzetta was now part of a stable of newspapers that included the Corriere della Sera, that newspaper whose guns La Gazzetta had spiked back in 1908 with their pre-emotive announcement of the Giro d’Italia. And the paper to which La Gazzetta had needed to go cap in hand in order to ensure they had sufficient finances to actually run the inaugural Giro in 1909.

The RCS group had started life in the 1920s when Angelo Rizzoli created a small publishing company, Rizzoli & Co, later to become Rizzoli Editore. In 1974 Rizzoli took over Corriere della Sera and the newly-merged company became Rizzoli-Corriere della Sera. By the end of the seventies, with La Gazzetta now part of the company’s publishing empire, the future should have been bright for RCS.

Things went tits up for RCS in the eighties when they found themselves caught up in the Banco Ambrosiano and the P2 scandals and – in 1982 – went in and out of bankruptcy. The 1982 Giro itself was very nearly cancelled. Vincenzo Torriani, the Giro’s direttore di corsa,  had to stand personal guarantor of its debts. Torriani was by now into his sixties and had been running the Giro for three decades. He certainly didn’t need the headache, but he wasn’t going to sit back and watch his race – and it would be fair, at this stage, to call it his race – to be ruined by the financial incompetence of others. Knowing his own shortcomings, Torriani called in a man to do the jobs he himself couldn’t do. That man was Carmine Castellano and, together with Torriani, he set about saving the corsa rosa.

The Giro was saved, in the end, by the arrival of the Seventh Cavalry. Well, the American Coca-Cola corporation, which stepped up to the plate. It wasn’t their black gold that the men from Atlanta showered on the Giro, it was one of their other brands, Sprite (about to be launched in Italy), which became the drink that saved the Giro. (If you think that Coke entered cycling when their bidons began appearing at the Tour de France after 1985, think again. You can even date Coke’s interest in cycling to earlier than 1982: back in 1968 it was their money which had been used in one of the failed attempts to get a young Eddy Merckx to ride the Tour.)

Scroll forward to 2000. In the post-Festina years the Giro suffered heavily from an association with doping, not just through stars like Marco Pantani being laid low by controversy, but also through the Italian judicial authorities making their presence felt at the Giro, raiding hotel rooms and tickling collars with alarming regularity. You would imagine that the teams had enough on their plates at the time but – surprisingly – revenue sharing was again high on their agenda. A group of teams – through the Assogruppi, the Association of Italian Sporting Groups, headed by Moreno Argentin – demanded a share of the Giro’s TV and merchandising revenues. And they figured they knew just what it would take to grab the race organiser’s attention: strike!

Rather than boycotting the race itself – clearly someone had learned a lesson from the 1924 Giro – this time the Italian teams decided they would refuse to participate in their media duties: post-race interviews and podium ceremonies were to be boycotted. Nor would they wear any of the race leader’s jerseys, including the maglia rosa. This they announced on the eighth stage. Moreno Argentin made his position clear:

They are prepared to talk […] but they never talk of the congestion of television rights and advertising. They want to see how strong we are. This is the only sport in the world in which ninety-five percent of the costs are covered by sponsors and five percent by television rights. Riders are paid by us and without riders, there would be no cycling.”

On the tenth stage of the race the Assogruppi took action. Stage winner Ivan Quaranta (Mobilvetta) and maglia rosa wearer Francesco Casagrande (Vini Caldirola) were no-shows on the podium and refused to talk to journalists from La Gazzetta or RAI. Polti’s direttore sportivo Gianluigi Stanga, speaking on behalf of the Italian teams, had this to say:

Bicycle racing changes. Twenty years ago, TV rights were not a topic, but today I think that it’s normal that the teams – and their sponsors who invest in them – get a say in where the money goes.”

 

The reason the dispute was limited to the Italian teams was that they believed foreign teams were being paid more than they were to ride the Giro. This sort of complaint was typical of the Spanish teams and riders in the Vuelta, especially in the sixties and seventies. Riders regularly complained about the vast sums being lavished on foreign teams in the form of appearance fees, especially when they fielded half-strength squads or just used the Spanish Tour as a warm-up for the Giro. Or even used the Vuelta as a way to make money, selling their services to the highest bidder. Pedro Delgado complained about this aspect of the Vuelta in his autobiography:

Apart from getting paid a good starting fee by the organisation, [the foreign teams] would accept ‘offers’ from the team of an escaped rider in return for not chasing him down. The system of these strong teams, especially the Dutch, was to only allow solitary breakaways, letting them build up a considerable leeway. These teams, filled with powerful road-men, were so dominant they could close down the escape in the final kilometres unless they found some other ‘interest’ in the stage.”

But the fact was the Vuelta needed to pay appearance fees in order to attract the stars of continental European cycling: in the years before and after Franco’s death, Spain was not high on people’s must-visit lists. How much the Giro needed foreign stars – and whether or how much they paid for them – is debatable.

RCS Sport responded to the Assogruppi’s actions with more words. They pointed out the long history of the race. They pointed out how the profits made on the Giro subsidised other RCS Sport events. Then they tried to kick the issue upstairs to the UCI:

The situation demands a careful analysis, in which the organisers and rider representatives must debate responsibly. After that we can perhaps change things. RCS Sport does not believe that such a serious problem can be resolved through a unilateral imposition of a solution, without assessing all of the information and comparing accordingly. The organisers have tried every effort to invite the Assogruppi to the discussions, but emotion seems to have prevailed over logic.

Before answering negatively to the ultimatum given to us by the Assogruppi, we want to verify our own position in the dispute and are seeking UCI president Hein Verbruggen’s opinion. We hope, however, that the Giro can continue as normal, and we would like to start the debate at its conclusion, rather than coming to a hasty compromise.”

The promise of talks, though, was sufficient for the Assogruppi to back down and life in the 2000 Giro returned to normal, or what passed for normality in the Giro in those days. What came of the subsequent talks between Assogruppi and RCS Sport isn’t clear, but nothing really changed, except for the UCI amending its rules with regard to travel expenses and participation allowances.

Appearance fees at the Giro became an issue again when the un-retiring Lance Armstrong made his return to the peloton, with the corsa rosa joining races like the Tour Down Under and the Tour of Ireland in the rush to hand over big bags of swag to the American in order to get him to put in an appearance at their races.

Then we come to last year, and the return to the centre of the stage of the appearance-fees issue, once again linked to TV revenues. At the Tour we had that little strop some of the AIGCP teams pulled, refusing to cooperate with ASO on certain media duties, specifically the issue of in-car race coverage (ironically, one of the points on the AIGCP’s ten-point plan to improve cycling). That doesn’t seem to have endeared them greatly to Marie-Odile Amaury and the attempts to get ASO to hand over a share of their profits – or even engage in talks over handing over a share of their profits – made little progress.

This week’s announcement from Jonathan Vaughters, that the AIGCP and RCS Sport were in advanced negotiations with regard to the issue of revenue sharing at the Giro, suggests that the AIGCP have adopted a different tactic in their negotiations: it’s easier to talk to someone who’s willing to listen and has something to gain from what is being proposed. On the surface, the notion of the Giro sharing a slice of their TV income with the teams makes sense. Michele Acquarone, interviewed by Daniel Friebe, has acknowledged that, over the last few years, the Giro has stood still while the Tour de France has marched forward. This, he knows, has to change:

Now we have to make up ground, and we can do it by trying to convince the biggest stars to come to our race, but it’ll still be their decision. Our biggest weapon in that battle for hearts and minds is the audience; the more people are watching, the more stars will want to come.”

 

The converse of that is equally true: the more stars who take on the Giro, the more people will watch the race. The Giro, after years of going toe-to-toe with the Vuelta over who can find the toughest climbs, is now living up to its marketing slogan: the hardest race in the most beautiful place. But, in audience share, it is still a league below the Tour. A revenue-sharing deal that’s structured around teams bringing their ‘A’ game to the Giro would help the race as much as it would help the teams. The Tour’s status in the minds of ordinary sports fans as the great bike race could even, finally, be challenged.

Acquarone, Bisconti, and Vegni in Milan at the Giro unveiling (Source: Pedalare Tricolore)

But Acquarone has also indicated that he is willing to play a long game with the Giro, and will not necessarily rush to bribe the biggest stars of the day to race the Giro:

What we can do, the only thing, is to build up the biggest possible international audience and grow our race so that our team is ready when a huge star comes along and captures the imagination again. We haven’t had that pied piper effect for the last few years, that excitement, and yet the race has grown, so that at least shows we’re moving in the right direction.”

On the issue of the proposed revenue-sharing deal with RCS Sport, though, it would appear that Vaughters may have jumped the gun to some extent. He himself did indicate that no deal was actually on the table, that the two sides were merely in discussion:

I’m very pleased with the negotiations with RCS and hope to have a deal that’s mutually beneficial at some time in the near future. I’ve been really happy with how RCS and Michele Acquarone has treated the teams. We’re really excited about the possibility of this partnership.”

Now, though, it is being reported that no deal is likely to be reached in the short term. Acquarone has indicated to VeloNews that talks are more likely to take place in the off season, November and December. Acquarone has also indicated that he was surprised to hear an announcement from Vaughters so soon and that any deal would be tied to future TV deals, not current ones. And here one needs to take a step back and look at the RCS Media group as a whole. The group may have turnover north of €2,000 million, but in 2011 they reported losses of more than €300 million, compared to a profit of €7 million in 2010.

A deal with RCS Sport would, of course, open the door to deals with other race organisers and, eventually, ASO. However, what those race organisers have to gain from such a deal needs to be considered. For the smaller events, some form of revenue-sharing deal that guarantees teams will bring their A squads would help generate more revenue from TV rights, a portion of which could be shared with the teams. But what’s in this for ASO?

TV rights for ASO events are currently sold in a package that includes the Tour as well as Paris-Nice, the Critérium International, Paris-Roubaix, the Flèche-Wallonne, Liège-Bastogne-Liège, the Critérium du Dauphiné and Paris-Tours, and other ASO events. A race like Paris-Nice could, perhaps, benefit from the teams taking it more seriously, but is there much to be gained at Paris-Roubaix, Liège-Bastogne-Liège or even the Flèche-Wallonne? Or take the Critérium du Dauphiné – ASO are still trying to bed that race down having only taken it over in recent years, and the level of prize money being paid there suggests it is not yet profitable. But serving as it already does as one of the major pre-Tour warm-up events, can the teams offer ASO more at the Dauphiné?

Consideration also needs to be given to the fact that ASO’s current deal extends through to 2015. If RCS Sport tie a revenue-sharing deal to future TV deals, you can expect the same from ASO. Which suggests no deal with ASO is likely to be forthcoming within the next year or two.

A lot has changed in cycling since Italian teams tried to hold a gun to the heads of the Giro organisers in 1924 in an effort to gain a greater slice of the cake. Down through the years progress has been made on the issue of appearance fees and the teams have managed to extract a larger slice of the cake from race organisers. Whether we’re really on the cusp of a new deal, or whether we are seeing a repeat of 2000 – talks that ultimately go nowhere – well, only time will tell.

Now that we’ve come to the end
I’ve been trying to piece it together,
Not that distance makes anything clearer.
~ Paul Muldoon

The story of the Tour de France began in Paris. Montmartre to be precise. That was where the offices of  L’Auto-Vélo were located and where Géo Lefèvre first punted the idea that became the Tour de France. In order to put some symmetry on this thing, let’s draw this series of articles on aspects of the revenue-sharing debate to its conclusion by returning to Paris. Issy-les-Moulineaux to be precise. That’s where Amaury Sport Organisation is headquartered, next door to the offices of L’Auto‘s spiritual successor, L’Équipe.

Most days, the story goes, you’ll find the matriarch of the Amaury family dining in L’Équipe‘s staff canteen. While it is her thirty-something son, Jean-Etienne, who heads up the sporting arm of the family empire, it is Marie-Odile Amaury who is the Amaury Group’s chief executive. The buck stops with her. And, as a hands-on chief executive, she undoubtedly seeks to stay aware of all the bucks heading her way. She keeps a watchful eye over the affairs of ASO.

What does Amaury see today when she looks at ASO? She sees a Dakar Rally that is going from strength to strength. She sees a Tour de France that is back on an even keel. She sees ASO’s cyclo-sportif footprint growing, with the creation of new events like the Etapa Argentina and the acquisition of events like the Roc d’Azur.

But Amaury must also be aware of the storm clouds gathering on the horizon. There are the ever-present clouds of those who call for a greater share of ASO’s wealth, more money, a bigger slice of the cake, more crumbs from the table. Nor can Amaury be unaware of the threats posed by would-be sporting-magnates like Arnaud Lagardère.

Even if Lagardère proves to be the sort who would pull a gun in a fistfight, I’d like to think that the Amaurys would still be able to take the media-to-munitions mogul. They’re not without a few dirty tricks up their own sleeves, as Laurent Fignon discovered after he snapped up Paris-Nice from under their noses. But that is a fight that is unlikely to come to a single stand-up knock-down session. The Amaurys and Lagardère are digging in for a long war, an attritional war, each chipping away at the other bit by bit.

What of the other notable rival, the UCI’s new race-organising arm, Global Cycling Promotion? Could ASO take them? Fighting the UCI is not easy. Not because they don’t play by Marquess of Queensberry rules (the Amaurys can pay scant attention to them too, when the need arises) but because, as cycling’s sole governing body, the UCI ultimately write the rules and referee the fight.

The Amaurys – to their cost – know that fighting the UCI is not easy. I’m not just referring here to the ProTour Wars. There’s older history than that. Back in the eighties, when Hein Verbruggen set in motion the changes which would turn the UCI from being a toothless tiger into a force to be reckoned with, the organisers of the Tour attempted to halt him in his tracks.

Starting out as a marketing executive with the candy confectioner Mars, Verbruggen rose to power within the UCI’s professional arm, the Fédération Internationale du Cyclisme Professionnel  (FICP), before – following the death of Luis Puig in 1990 – taking the helm of the UCI itself. While still with the FICP, Verbruggen took an idea from Vélo magazine and introduced the FICP World Rankings, which put a value on the head of every rider in the peloton, based on the points they accumulated over the course of a season.

Then Verbruggen expanded his power base with the introduction of the World Cup, supplanting the Super Pernod Prestige Trophy. FICP points became the key to gaining entry into the World Cup races. Félix Lévitan and the men of the Société du Tour de France saw Verbruggen’s initiative as being an attempt to stake a claim on sponsorship income, an attempt by the UCI to bring their own sponsors to others’ events. A move which would ultimately, they calculated, see the UCI muscle in on the TV revenues generated by the race organisers.

The Tour’s organisers became résistants, fighting the UCI with word and deed. In 1988, with the Société du Tour de France in turmoil as race directors fell like flies (three leaving in the space of just eighteen months) the Tour’s organisers even offered Verbruggen the gig that would neutralise the threat he posed to them: become Jean-Pierre Courcol’s replacement as director of the Tour de France. The men of the Tour know the truth of the old adage about keeping your friends close, your enemies closer still.

Hein Verbruggen, though, was not for turning and declined the offer from the Société du Tour de France. The World Cup ploughed ahead, eventually morphing into the ProTour before being rebranded as the WorldTour. For sure, the Tour’s organisers won some important skirmishes. The battlements around the Tour’s TV revenue withstood the brickbats the UCI tried to throw at them. And the World Cup was never successful at attracting its own sponsorship income.

A story for you: if you’ve ever worked in the media industry, there’s a trick you might be familiar with when faced with new rivals (or when threatening existing operators in the market): sponsors (advertisers) are advised or induced to stay away from the new kid on the block. The new kid is left to slowly wither away, expenses mounting up, reserves being run down, little or no income coming in. Eventually they fold and go away. Some people call this bullying. Others call it business. Whatever the name, it’s a trick that the Amaurys are not unfamiliar with, on both the media and sporting sides of their empire.

Whether this is why the World Cup singularly failed to attract sponsors, or whether the World Cup was just a pointless event that no one could see any merit in, well that’s a question that remains unanswered. But it was an attractive enough proposition when Pernod used to sponsor it. Back then, though, L’Équipe were supportive of the Super Pernod Prestige Trophy and gave it plenty of column inches.

All victories come at a cost. ASO were made to pay a price for their defiance. Showing his contempt for the sport’s traditional stakeholders, Verbruggen rode roughshod over them. One example: he added a time trial to the UCI-organised World Championships. In doing this he killed ASO’s end-of-season time trial, the Grand Prix des Nations. The UCI’s lesson was clear: don’t fuck with us.

Back to the present. The storm clouds on the horizon. What threat does Global Cycling Promotion pose to ASO, when all ASO’s races are within cycling’s traditional heartland? GCP is, after all, supposed to be charged with bringing bike racing to the rising economies of the BRIC countries (Brazil, Russia, India, and China). Where’s the beef in that?

The beef is that all of ASO’s races are not within cycling’s traditional heartland. ASO, for a long time, have been involved with developing cycling in Africa, through their Tour du Faso. That seems to have slipped quietly off the calendar this year. The why and the how I don’t know, perhaps someone reading this will tell me one day. But Africa is not the end of ASO’s international interests. ASO are partnered with AEG, the organisers of the Tour of California. They’re also helping to bring cycling to the Arab world, with the Tours of Oman and Qatar. And ASO partnered with Oman in their bid for the 2015 World Championships.

With ASO’s cyclosportif footprint expanding into Argentina on the back of the success of the Dakar Rally, can it be long before they set their sights on organising races in countries visited by the Dakar (Argentina, Chile and Peru)? Or look at Indonesia. Earlier this year ASO had advisors at the Tour of Singkarak (a 2.2 event, held in June). Advisors, fans of military history love to point out, frequently turn into boots on the ground.

So the UCI, through GCP, are not the only ones trying to expand cycling beyond its traditional borders. As ASO’s Christian Prudhomme pointed out a few months back, none of this is new for the Amaurys. “Riding a bike is universal,” Prudhomme explained during this year’s Tour, “but cycling competitively isn’t yet. We have to go everywhere […]. International development is important for ASO.” He then went on to highlight the history of the Tours of Oman and Qatar, before offering his audience another slice of history: “But this isn’t new to us. In 1954, four years before the foundation of the common European market, we organised the start of the Tour de France in Amsterdam, outside France. We went to Berlin in 1987 before the fall of the Wall, etc.”

The UCI can, at times, be thin-skinned and Prudhomme’s boasting might have been seen by some as a put-down of the UCI’s efforts to internationalise cycling. The UCI never took kindly to Dick Pound’s little barbs. And, in more recent months, they were stung by comments from USADA’s Travis Tygart having to do with foxes and hen houses. If the UCI and ASO were really entering into another petty little struggle for the soul of cycling, the UCI could easily have responded to Prudhomme’s braggadocio by reminding us of all the non-traditional nations they have sent the World Championships to down through the years. Or maybe they could have just pointed out that the reason the Tour went to Berlin had little to do with bringing cycling to the Communists and everything to do with capitalism: the good burghers of Berlin paid the Société du Tour a king’s ransom in order to entice them across the Iron Curtain.

But would the UCI waste their time fighting ASO with words when they can fight them with deeds? Time to recall a story told in the first part of this series. Back in 1946, when the post-Libération fight for title to France’s Grand Tour was going on, the UCI settled the first round by choosing Jacques Goddet’s Tour de France over its rival – Ce Soir‘s Ronde de France – for the calendar slot. Today, the UCI still have control over those calendar slots. Events can be shifted around the calendar to rival existing events. Or new events can meet considerable resistance in their attempts to gain a calendar slot. And, of course, old events can always lose their place on the calendar. While we would all notice were the UCI to attempt to remove the Tour de France from the calendar, how many of you had heard of the Tour of Singkarak before ASO sent advisors there?

So let’s ask the question again: what threat does Global Cycling Promotion pose to ASO? Some drippy hippy shit here: if a smile is just a frown turned upside down, then a threat is just an opportunity in disguise. Rather than asking whether GCP represent a threat to ASO, we should wonder instead whether GCP are really an opportunity. ASO and the UCI have, after all, kissed and made up since the ProTour Wars. And ASO have partnered with the UCI to bring cycling to the Chinese. Those aforementioned words from Prudhomme, they were made at the media launch of the Tour of Beijing.

But aren’t ASO still fighting with the UCI? Despite Marie-Odile Amaury’s edict that L’Équipe should give over banging on about doping and report news rather than make it, wasn’t it L’Équipe who broke the story about the UCI’s Index of Suspicion? Had the UCI done something to upset the Amaurys, causing them to respond in such an unkind fashion?

That Index of Suspicion story, how did it really hurt the UCI? Why, it hurt them by showing that they suspected certain riders of doping more than they suspected others! That really is utter balls. The Index of Suspicion was exactly what many in the anti-doping community have long called for: greater use of intelligence-based target testing, as opposed to inefficient blanket testing. Wasn’t this exactly how the AFLD and the FFC caused such a stir at the 2008 Tour, by profiling riders in advance of the race and then using those profiles to draw up a list – an index – of who the testers needed to pay the most attention to? Look at how successful that was.

The people who were hurt by the Index of Suspicion were the riders. Their teams felt the pain too. Because the cycling community saw the Index of Suspicion as being an Index of Guilt, rather that what it really was, an index of priority for the testers, partly based on something as simple as when a rider was last tested. Whoever gave that list the title of the Index of Suspicion was a clever little operator.

When did the Index story break? May time, wasn’t it? Not long after the AIGCP’s deadline for “drastic action” should the UCI fail to rescind the ban on race radios. That drastic action, we all knew even before the May Day deadline, was a boycott of the Tour of Beijing. A race organised by the UCI in collaboration with (among others) ASO.

Step back in time to just a few weeks before L’Équipe revealed the leaked Index. Recall that little strop some managers pulled, walking out of a meeting with the UCI. Some of the managers claimed that their walkout was spurred by the UCI trying to give them a history of the bicycle, which is always a contentious issue, with the French and the British going at one another, each claiming they got there first. Only for the Germans to get chippy at their contribution being overlooked. And all the while the Italians just sit there looking smug, knowing that they hold the trump card, some doodles in one of Leonardo’s notebooks. It’s usually around that time that the fists start flying. There are days when I actually admire Pat McQuaid.

The day after that meeting, L’Équipe carried a report of its proceedings, a report which claimed McQuaid had informed the managers that, thanks to the bio-passport, he held precise information on each team’s riders, before brandishing “the spectre of public revelations that would cause damage.” One AIGCP member, Roberto Amadio (Liquigas), disputed L’Équipe‘s version of events but in doing so seemed to confirm that McQuaid had in fact threatened them with the public revelation of a list of targeted riders.

And then, by one of those strange coincidences life throws up all the time, such a list of targeted riders happened to find its way into the hands of someone at L’Équipe. Someone who, despite Amaury’s edict to the contrary, banged the doping drum and made the news instead of just sitting back and reporting what others had uncovered. Did a head roll in L’Équipe that day? There’s more than enough blood on Amaury’s carpet to suggest that, had the Index of Suspicion story offended her, the journalists and editors responsible would have faced the guillotine.

Am I just peddling a conspiracy theory here, demonstrating that I read far too many thrashy thrillers? Of course I am. For the UCI were hurt by L’Équipe‘s release of the Index of Suspicion. They were cut to the quick. They were shocked – shocked I tell you – that someone could leak such a list, quite possibly someone in their own organisation. And so McQuaid promised to do a George Smiley and root out the traitor in the UCI’s ranks. Except, of course, that I see McQuaid as less like George Smiley and more like George Stroud, from Kenneth Fearing’s The Big Clock.

And so when I picture Marie-Odile Amaury sitting in her Issy-les-Moulineaux office, gazing out at the Paris skyline and the storm clouds gathering on ASO’s horizon, I don’t see her frowning when she views the cloud caused by GCP. I see her smiling. Happy in the knowledge that ending the ProTour Wars was – for ASO – the right thing to do, for in so doing she finally enabled ASO and the UCI to unite in a common purpose: sharing the revenue to be generated by the global expansion of cycling.

Marie Odile Amaury, PDG du groupe Amaury (Crédits photo: HAMILTON/REA)

And I see her smiling, happy in the knowledge that Hein Verbruggen has left the stage and gone off to play World Mind Games with his new toy, SportAccord. But look closely at that smile. Is that a frown forming at its edges? SportAccord is, after all, just a new stage from which Verbruggen is waging his war to allow sports’ international federations to seize control of the TV revenues generated by their sports. The battlements around the Tour’s TV revenues are already being reinforced in preparation for Verbruggen’s next assault.

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.

“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.

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.

In the Summer of 2010 two newspapers owned and operated by the Amaurys – Le Parisien and its sister title, Aujourd’hui en France – were put up for sale. The bankers at Rothschild valued the combined titles at €200 million, with a reserve of €170 million. Expressions of interest came from rival publishers like Serge Dassault (Le Figaro) and Vincent Bolloré (Direct Matin, Direct Soir, Direct Sport). There was also some interest from Belgium (the owners of La Voix du Nord), Germany (the Springer group, owners of Bild) and from the UK (Mecom, David Montgomery’s struggling wannabe media empire).

But no one was biting at the €200 million asking price. The Belgians valued the titles at just €100 million and only wanted to buy 80% of them. Dassault – whose other interests, like those of Arnaud Lagardère, also extend into the world of warfare – offered no more than €130 million. The “For Sale” signs, the Amaurys declared, were taken down.

Why were the Amaury’s willing to dump Le Parisien? Had they simply had their fill of the trouble and strife – declining circulation and a truculent workforce – owning it brought them? One reason given by some is Arnaud Lagardère, whose media to munitions empire has owned 25% of the Amaury Group since the eighties.

Media mogul Arnaud Lagardère     photo: Reuters/Phillippe Wojazer

Like Marie-Odile Amaury, Arnaud Lagardère has only relatively recently taken control of the family business. In the case of Lagardère, that business was originally created by his father, Jean-Luc Lagardère. From humble beginnings as an engineer with the aircraft manufacturer Dassault, Lagardère Senior began to create an empire that ranged from munitions (the armaments and missile company Matra) through to media (the radio station Europe 1, the publisher Hachette). When Jean-Luc Lagardère died in 2003 it fell to his son, Arnaud, to take the helm of the empire his father had created.

Like Marie-Odile Amaury, Arnaud Lagardère has encountered a certain amount of resentment simply for inheriting the family business. Frequently he has found himself compared unfavourably with his father, in the same way that Amaury has been compared unfavourably with her husband. “I am an heir, therefore I am stupid,” Lagardère once pointed out to a biographer. “That is the way we see heirs in this country …” For some in France, dynastic succession in business is seen as being too close for comfort to the concept of royalty. The French know how to deal with royalty.

But whereas Marie-Odile Amaury seems determined to remain true to the ideals of her husband and preserve the family empire, Arnaud Lagardère seems to be rebelling against his dead father and has set himself the task of disassembling the empire he inherited, in order to build it anew. Much of that empire was made up of minority holdings in different enterprises. Recently, Lagardère has decided to extricate the business from these investments. Stakes in Marie Claire (42%), Canal+ (20%), La Dépêche (15%), l’Alsace (20%) and others are all up for sale. A large part of Hachette has already been sold to Hearst and his stake in Le Monde‘s online division has also been sold.

What, though, of Lagardère’s 25% stake in the Amaury Group? Curiously, when it came to the Amaurys, Lagardère didn’t want to be a seller. He wanted to be a buyer. In the spring of last year he publicly made the widow Amaury an offer he thought she couldn’t refuse: sell him the whole business or he would dump his minority holding.

Why, if he’s unloading his media interests elsewhere, did Lagardère want the Amaurys’ business? Simple: Lagardère has looked at the sporting landscape and sees gold in them thar hills – a $100 billion global market – and has struck out for the end of the rainbow, shovel and pick over his shoulder. Last year he consolidated his Group’s existing sports interests – which date back to the sixties when his father oversaw the sponsorship on the Matra-Ford F1 team – in a new vehicle, Lagardère Unlimited, whose objective is modest: to become the premier player in international sports marketing and media rights within five years.

Key to Lagardère’s plan is growth through acquisition. The Lagardère Group has already absorbed companies like Sportfive, which handles European media rights (mostly football); IEC In Sports, which deals with sports rights for Olympic sports; Upsolut, a German organiser of sports events; Prevent, organiser of tennis events in Sweden; World Sports Group, which handles media rights in the Asian market (mostly football, cricket and golf); and Best, which is involved in athlete representation, event management, and the sale of media rights in the US.  Lagardère has also taken a minority stake in Saddlebrook, an academy which seeks to train the basketball, baseball and football stars of tomorrow.

An attempt to buy into IMG – the company Lagardère seems to measure his own success or failure against – failed. And the widow Amaury showed her mettle and rebuffed his advances too.

Lagardère responded like a lover spurned. He accused the Amaurys of having a conflict of interest, between L’Équipe, the events organised by ASO, and the company’s stake in the online-gaming site Sajoo.fr. Never mind the fact that he himself is looking to build a vertically-integrated sports marketing and management empire that would see him training athletes, managing them when they turn pro and organising events at which they might compete. That’s neither here nor there. What matters, he would have the world believe, is the Amaurys’ conflict of interests. Not his.

Having been brushed off by the Amaurys, Lagardère now wants to cash in his stake in the Amaury Group. And the Amaurys need to finance the buy-out of their dissident shareholder. Hence, it is argued, the abortive proposal to sell Le Parisien and Aujourd’hui en France. How much the Amaurys need to raise is open to debate. For a start it depends on how much they have sitting idle in the petty cashbox. Which got a bit of a boost last year when the Amaurys sold L’Écho Républicain, a small, local paper which it originally bought in 1999 (from, as fate would have it, the Lagardère Group).

Of bigger import though is the valuation of Lagardère’s shareholding in the Amaury Group. Some have valued the Amaury Group at €2 billion. Lagardère himself says his 25% stake is worth €200 million. The Amaurys say it’s only worth €100 million. Between the ask and the offer there is clearly a lot of ground to be made up. Ground which representatives from each side will have to negotiate (Crédit Agricole representing Lagardère, Rothschild presumably representing the Amaurys).

That is, of course, unless one can convince the other to change their mind: either the Amaurys persuade Lagardère to hold on to his shares; or Lagardère convinces the Amaurys to give him what he most wants – the Tour de France and the rest of the Amaury Group’s stable of sporting events and media-rights-management interests.

A third option would see the Amaurys sitting back and letting Lagardère sell his shares and then learning to live with his replacement, whomever that might be. Not many people, though, want a 25% stake in a private company given how little control over its affairs that offers them. Or the exit strategies open to them.

How much of a competitor is Lagardère Unlimited to ASO? ASO’s principle sporting interests are event management and media rights. Lagardère Unlimited’s principle interests are athlete management and media rights. On the event side of its books, Lagardère Unlimited has twenty events across eight disciplines (American Football, Basketball, Cycling, Figure Skating, Football, Golf, Tennis, and Triathlon), none of them having the status of something like the Tour or the Dakar. In cycling, there are just two events, both built around the model of a pro race plus a cyclo-sportif: the Skoda Velothon in Berlin and the Vattenfall Cyclassics, which incorporates Germany’s sole contribution to the UCI WorldTour series. Compared with the Amaurys’ stable of cycling events, Lagardère Unlimited must seem like a gnat, of no great consequence.

But even gnats can sting. And Lagardère has stung the Amaurys: in the most recent bidding for control of the European TV rights for the Winter and Summer Olympics – covering the 2014 and 2016 Games – the Amaurys lost out to their dissident shareholder.

Despite cycling itself not being central to Lagardère’s plans – his preference is for sports with balls – the little interest he has shown so far in the sport leaves questions to be answered. Such as just what was he discussing with Lance Armstrong when the two had a meeting during the Tour of Murcia last year? Could he have been attempting to sign the American to his athlete management agency? Or was he discussing his bid for the Tour de France with a man who himself made a putative attempt to buy the Tour from the Amaurys?

And given the year the sport has gone through – with threats of secession by some team managers and the AIGCP generally trying to reorganise the way the sport is run so that the teams take a larger slice of the sport’s revenues – it would also be interesting to know who else within the sport Lagardère has had meetings with in recent months. He is a known associate of Johan Bruyneel, but of whom else in the cycling world does he have an ear?

How serious Lagardère is about turning the family business into a sporting giant, though, is a question some in France have been asking. Previously, his sporting interests – Team Lagardère and Lagardère Paris Racing – have seemed like little more than vanity projects. Lagardère is seen by some as being just another dilettante blessed with a substantial inheritance.

Over the course of the summer, the divorced father of two only added to this view when he became something of a French YouTube sensation, star of a video showing him and his girlfriend (now fiancée), Jade Foret, preening and posing for a magazine photoshoot. The three-decade age gap between the two – he’s 50, she’s 20 – has amused some, prompting the usual questions of quite what she sees in the diminutive billionaire or he sees in the leggy model.

For others – keen to put Lagardère on the couch and play Freud with him – the fact that his father’s second wife was also a statuesque model (he towered over her in age, being her senior by eighteen years) is enough to set them off in a chin-stroking reverie (“Ah, he really is his father’s son, eh!”). How these people reacted to Lagardère’s comment that what attracted him to Foret was that she reminded him of his mother you can only wonder at (and some among you will no doubt now be stroking your own chin and wondering if it wasn’t just an inhibited Oedipus complex he and Armstrong were discussing in Murcia).

In the staid world of French finance, though, this silly-season story led to some calling into question Lagardère’s suitability to take the helm next year of EADS, the Franco-German aerospace and armaments giant in which the Lagardère Group holds a 7.5% stake. And which his father before him once presided over. The leadership of EADS is a political prize that rotates between Germany and France and the deal ensuring Lagardère’s ascension to the throne was brokered between Angela Merkel and Nicolas Sarkozy. Sarkozy is now being called upon to reconsider his choice of Lagardère. Who would have thought that the French would find it hard to accommodate the notion of a middle-aged man marrying a model who towers over him and think that such a relationship should debar him from taking the reins of power?

But Lagardère should not be underestimated. If the chin-strokers are right and Arnaud Lagardère really is his father’s son, then he will be as determined as his father before him to make his mark in the world of business. To be a success. The equal – at least – of his father.

Lagardère has been brought up to believe that success can be bought, as evidenced by the number of companies that have been acquired in order to grow the Lagardère Group’s sporting interests. Influential friends can also be acquired. Lagardère’s little black book has some very interesting entries. Over the years he has – through business and through things like his patronage of Paris’s failed bid for the 2012 Olympics – cultivated relationships with the likes of Nicolas Sarkozy, Dominique Strauss-Kahn, Alain Juppé, Martin Bouygues, Bertrand Delanoë, and Laurent Fabius.

In the same way that Émillien Amaury first built the Amaury empire by cultivating friendships with those who wield power, Arnaud Lagardère understands the need for friends in high places. And how to use them to get what he wants.

Next: Back to basics – the Tour de France in numbers.

Previously: An Empire at the Crossroads.