Why a 25-race F1 calendar is a risk

So much for those who said only Bernie Ecclestone is able to negotiate race hosting contracts. Since his de facto departure from Formula 1's driving seat in late January, the incoming owner of its commercial rights, Liberty Media Group - currently undergoing metamorphosis as it converts to Formula One Group - has agreed two contract extensions, the Canadian Grand Prix's renewal running through to 2029 at that!

Even Sochi's deal, to 2025 is not too shabby. That comes hot on the heels of announcements that local finance house VTB Group takes over as title sponsors of this year's Russian race as part of a move by promoter NPJSC to sever financial ties with the national government.

The next circuit likely to renew is Shanghai, particularly given that next month's edition is the last under the current contract. The Shanghai local government recently published a paper called 'Shanghai Sports Industry Development Program 2016-2020', with the grand prix identified as a must-keep, showpiece event.

"By 2020 [Shanghai] commits to keeping the momentum of holding an iconic event in each month," the publication said. "Firstly, to improve the operation and effectiveness of the eight existing big events, such as the F1 Chinese Grand Prix...

"Thirdly, to grow the appeal of Shanghai to international top commercial sport events... and add 1-2 big events by 2020."

Promoted by local company Juss Events, the renewal may, though, be a break from recent tradition in that Juss may no longer retain the rights to the event's TV rights, with a joint venture comprising local broadcaster CCTV and the Chinese affiliate of sport's marketing giant IMG said to be in the running. Neither party responded to a request for comment although a local media source is adamant a switch could happen.

CCTV-IMG already promotes the China Touring Car Championship (CTCC) in conjunction with the FIA. Should the switch happen, it would mark the first of what observers predict will be a raft of broadcaster channel migrations for F1 as existing contracts expire. The other alternative would be for IMG to go it alone via its US-based operation, which, again, would be a coup for FOG.

All these deals, though, count for nothing in the greater scheme of things unless the fees at least equal those extracted by the outgoing CVC/Ecclestone regime, for increased fiscal demands are sure to be made on Liberty by all teams as part of post-2020 commercial negotiations. As outlined previously, the Big Four (Mercedes, Ferrari, Red Bull and McLaren) are unlikely to accept reduced shares of F1's revenue streams, while independent teams will surely push for more than they have received up to now.

In order to keep teams (and shareholders) sweet, Liberty needs to grow revenues, not offer discounts to circuits and broadcasters. And the only way to achieve that objective - short of pricing itself out of the market, with predictable long-term effects - is to increase the calendar.

As Ecclestone, who long harboured ambitions of 25-race calendars, discovered, expansion is far easier said than done. This year's 20-round championship is one shy of last year's total, despite a concerted push in all geographical directions to grow the calendar.

The reason for this lack of growth was primarily the astronomical hosting fees F1's then-tsar charged, and one wonders whether Liberty managed the same trick with the recent renewals. If so, a toff of the hat to whoever led the negotiating team for proving that Bernie could, after all, be dispensable.

If Ecclestone was spectacularly successful in persuading Middle Eastern and Asian governments and entrepreneurs into buying into his model - but less so at retaining them, as Turkish, Korean, Indian, and, now, Malaysian promoters can attest - the same cannot be said of his efforts in Europe, Africa and the Americas.

True, Bernie talked Valencia into a race at the height of Fernando Alonso fever, but the event lasted just five years before collapsing in acrimony. He encouraged Red Bull boss Dietrich Mateschitz to stage F1's return to Austria at the circuit now named after the energy drink company - but attendance has plummeted since that jam-packed 2014 race. Yes, a deal was cut for Paul Ricard's return, but that is slated for 2018.

For the rest: Bernie couldn't hold onto a regular race in the land that invented the automobile, the country where motorways are largely unrestricted, the nation that oozes high performance motoring: Germany. Until well after last year's race at Monza the future for F1's temple of speed was uncertain, while Silverstone has already advised its members that it could soon trigger its exit clause.

With those cases in mind, Liberty (FOG) has plenty of headroom for new races. Three whole continents (Africa, North/South America) could add at least a race each - in South Africa, Argentina and the USA's east and /or west coasts - while Europe is again ripe for the plucking, potentially providing five or six events to add to the current fixture list, or 25 per season even if Silverstone or another venue drops out.

The caveat, however, is sustainability - and that raises a whole array of questions, for all too often the popularity of a race is linked to the presence (and success) of a local hero. During the 2000s, Hockenheim and the Nurburgring packed their stands to the absolute rafters due to the victories notched up by Michael Schumacher and Ferrari; ditto Monza and Imola. When Michael's winning ways stopped, so did ticket sales.

In recent years Silverstone has been the best-attended grand prix - mainly due to Hamilton-mania, aided by Jenson Button's popularity. Should Lewis impulsively hang up his helmet, the odds of the oldest race on the trail attracting 140,000 punters on race day are far from even. The race could then come perilously close to bankrupting its owner, for break-even lies at roughly that attendance figure so inflated are its hosting fees.

The driver factor makes a Dutch Grand Prix particularly attractive to Zandvoort's new owners, who acquired the circuit early last year. The Max Verstappen Day at the circuit situated amongst North Sea dunes have during the past two years been extremely well-attended - the Dutch will follow any sports star donned out in shades of orange - but the circuit would require major investment to meet F1 standards.

As it is, various tracts of land were hived off years ago to seaside resort developers to cover debt, resulting in the loss of evocative corner names and emasculation of its famous straight. While the current compressed layout could conceivably cater to F1, massive investment would be required to provide a start-of-art venue and meet FIA safety standards.

While the current owners - their number includes Prince Bernard of Orange, cousin of King Willem-Alexander - of the holding company (named Chapman Andretti b.v. in deference to the 1978 world titles-winning duo) are self-confessed petrolheads and entrepreneurs with strong records in property development, they are hardly likely to pour their fortunes into a project riding on a single Dutch driver.

Kyalami faces similar challenges. Now owned by the (Toby) Venter family trust, the circuit, which hosted two grands prix (1992/3) on (roughly) its present layout, has been totally rebuilt and upgraded at a price estimated to run to R500m (£25m) in a country with substantially lower construction costs than Europe, yet is still only an FIA Grade 2 (sub-F1) level track.

Developer Andrew Baldwin concedes that an imminent return of F1 is not, though, on the agenda considering the amount of funding that would be required: "The challenge is the business model, in terms of finding the money to bring F1 to South Africa," he told Autosport during a visit to Kyalami last year.

"I can't see it at the moment, but never say never. We'd love to see F1 back in Kyalami."

Asked what it would take to bring F1 back to the venue, Baldwin said: "We would need government support. It's the only way, as proven in other countries. They are aware of what we're doing, but I can't say we've had formal discussions."

Given South Africa is poised to lose the 2022 Commonwealth Games on costs grounds, what chances its government, already reeling after the 2010 FIFA World Cup, subsidising F1?

Which brings us to the French Grand Prix, the last deal negotiated by Ecclestone before his sidelining, but sealed three months after Liberty first bought into F1 - albeit a deal long in the making and likely greased by the fact that the circuit is owned by Excelis, a company controlled by the Ecclestone family trust.

Whatever, it means that France, like Austria, returns to the calendar, thereby altering the Europe/Asia imbalance and providing a buffer against Hockenheim's expected departure when its contract expires after next year's race. The question is, though, whether Ricard's 2018 race is granted a July or August date - both have been suggested - as either will set up a clash with existing European rounds.

FOG's North American options were dissected here, which leaves Argentina. More specifically Buenos Aires. A race there is regularly mooted, only to fall apart at the first mention of hosting fees, and, like a return to South Africa, so a return to the equivalent latitude on the opposite side of the Atlantic is likely to test Liberty's negotiating skills to the max.

After all, if Bernie could (re)crack neither country in recent years, an additional grand prix or two in the southern hemisphere would massively boost Liberty's negotiating credibility, while increasing F1's global footprint. And without jeopardising the sustainability of existing events, whether in traditional or emerging markets.

That, in a nutshell is the key to F1's future strategy: sustainability of teams, venues and media outlets. When TV ratings have plummeted for six straight years - F1's latest Global Media Report reveals drops in major markets of around 10% to 390m unique viewers (defined as people exposed to at least 15 minutes of F1 during 2016) - it must critically question its own sustainability: if not publicly, then certainly internally.

In order to succeed, Liberty needs to better Ecclestone's best negotiating skills while ensuring a prosperous and stable environment for all players, including the fans. That will be a tough balancing act, with the ultimate result being measured by a simple metric: TV ratings. Too few races and the numbers won't add up; too many, and fan fatigue will destroy all the good work.