Croker Sack

"Democracy is the theory that the common people know what they want, and deserve to get it good and hard." — Henry Louis Mencken (1880-1956)

Wednesday, December 07, 2005

NASCAR Signs New Media Deal

The private side of the proposed public-private partnership that would bring NASCAR racing to Kitsap County has agreed to a new multi-year media contract.

Our would-be partner was selectively silent during the press conference when it came to a question about the revenue to be earned from broadcasting companies:

Q: Brian or Dick Glover, are reports of a nearly 40 percent increase over the $400 million dollar a year average contract?
France: We never get into the financial aspects of any of our agreements. Just can't comment on that.
I will tell you that the promotional value that all three companies have committed to is unprecedented. The amount of programming, as said earlier, is going to be quite a benefit to our NASCAR fan base. Just can't get into the financial details.

NASCAR and their subsidiary corporations can, of course, refuse even to give hints about the revenue on their side of the ledger; but how does that fit within the idea of a "partnership" involving the government?

The total of the broadcast media revenue may not be made public, but here's a description of the way the private parties plan to divide up the pie:

Q: Brian or Mr. Glover, one of the larger concerns in the garage anyway about the last television package was kind of how the money breakdown worked. From how we understood it, the vast percentage of that breakdown went to tracks and NASCAR corporate. Can you lay out for us just bare bones how the new percentage breakdown might work?
France: We don't necessarily have a new percentage breakdown. That is something that's not likely to change. We like the way it's allocated currently, which is 65 percent to the tracks, 25 percent directly to the teams, then that little left, that 10 percent, to the fine folks that I work for. It all works out. It's typically worked out fairly well.
Obviously we'll look at it as we go along, but we're pretty comfortable with where we are now.

So, if the state of Washington agrees to pay a little more than half the cost of building a speedway and an as yet unspecified part of the cost for off-site infrastructure improvements, can we look forward to future press conferences in which our private partners will proudly state that they are "pretty comfortable"? Probably so, since the reason for the government subsidy is to enlarge the potential profit for the private side of the public-private partnership.

Would it help if we changed the name of our county for the duration of the coming negotiations from Kitsap to Kitsharp?

Update, Dec. 8, 2005: Why be so coy at their press conference? Today, has the approximate amounts to be paid by each of the networks, and Investor's Business Daily notes the drop in the stock prices of International Speedway Corporation and Speedway Motorsports after the new media contracts were disclosed.
The analysts and investors had been anticipating a bigger increase in the revenue from these new contrasts, so the share price dropped with the disappointing news.
It seems that the approximate revenue from the new contracts is material information that must be disclosed by publicly traded corporations like ISC, so why not answer the question at the press conference?


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