rec.autos.simulators

--
Jeff Murchison Jr
http://www.racesimcentral.net/

-Paul

Hardly, Andrew Craig has brought a level of professional
management to CART that was sorely lacking in the past.
Under his direction CART became a publicly traded entity
so all one need do to check on the fiscal health of the
series is enter 'MPH' in any online stock research tool.
Doing so will show quarter after quarter of increased
revenue and record profits.

 - George

There was a time when Apple computers was recording steady profits
thanks to the price tags on their machines and the business they did
in certain kinds of markets (academic and graphics).  We know what
happened to them as a result.  Profitability is not the only measure
of the health of an organization.  Those low TV ratings are noticed by
the sponsors.  Have you seen Valvoline ditch Mark Martin in NASCAR?  I
haven't.  I was actually relieved that Tony Kanaan won because it
meant McDonalds was given some reason not to regret their decision to
go to CART.  I don't recall feeling this concerned about sponsors in
NASCAR or F1, but in CART I worry about every one of them.

If enough sponsors jump ship because the sport is lacking in eyeballs,
the profits and the stock will follow.

Randy

True, but it certainly beats:

1) 'I heard ratings are down so the series is in trouble'
2) 'I saw a bunch of empty seats at the last race so CART is near death'
3) 'Sponsor X is pulling out of team Y so something must be up'

With a trivial amount of research you can answer each and every one
of the above and draw an INFORMED conclusion about the true
health of the series:

1) TV revenue is given in each quartly report, for the year it is slightly
down indicating either fewer races have been run this financial period
compared to last (the revenue is collected on a per-race basis) or the
per-race TV revenue is less (strongly suggesting that the ratings have
gone down).  Best to wait for the annual report on this one unless
you want to pay for TV ratings (ouch, they cost a bundle).

2) Sanctioning fees are up a bunch which indicates that track owners
and promoters are in general happy with the series and therefore
willing to pay more.  Of course, Cleveland did opt out rather than pay
more so you have to take that into consideration as well.  You can
also check the progress of the big track conglomerates as most of
them are traded publicly as well (last I checked they are doing
fine [TRK, SPWY, ISCA]).

3) Team sponsors are seldom static (ask Ricky Rudd about that), the
whole concept is based on marketing and marketing is a bit of an odd
bird.  More related to CART itself sponsor revenue is also up big
time.

So the series looks in pretty good shape to me so why the doom
and gloom?  If anything I think Andrew Craig should be praised,
having watched this series most of my life I can remember when
things were truly on the brink of collapse.

Until that starts to happen you are just guessing, which is fine, you are
entitled to an opinion, however with the amount of information available
on the Internet why not strive to do better than that?

 - George

More accurately, they had high margins, thus high profits, and then as
their marketshare dwindled in comparison to PC clones their profits
dived.  Then they reduced their prices and opened up their
architecture but it was too late at that point.  The relevance here is
that rather than look strictly at the short term, determine whether
you can project growth into the future, regardless of what current
profits are.  I don't see CART projecting real growth into the future.
If they were, you wouldn't see the 4 engine manufacturers at IMS
talking to Tony George and saying they wouldn't rule out just about
any kind of compromise to get back to Indy, and people like Bill
France Jr saying there should be only ONE open wheel series.

Yes, and the ratings are stagnant at best.

If attendance continues to fall, the "happy" promoters are going to do
what Cleveland did.  I cannot believe that only 45,000 people showed
up at Michigan.  That's AWFUL and I don't care what spin you want to
put on it.  Why do you think they are running NASCAR trucks alongside
CART events if CART is so strong by itself?

How many of those sponsor CART alone?   Most of them are doing fine
largely because of NASCAR or its support events, not because the
stands overfloweth with CART attendees.  The biggest draws for CART in
terms of crowds are still the road & street circuits (fine by me...I'm
a Laguna Seca attendee every year and always will be!)

We'll see how long that holds out.  Many sponsors have indicated a
strong desire to return to Indy and get the series' reunited.  They
may very well be continuing the status quo with CART while they wait
this thing out.  If CART goes back to Indy and the series either
re-unifies or gets together at Indy again once per year, then their
loyalty will be worthwhile.  If attendance and TV ratings continue to
drop, they will re-evaluate.  

Because every indicator of long term growth is DOWN while the money
itself grows.  It's simply common sense to look at where the money is
coming from and ask WHY that money is coming from those places, and
once you know that, you want to know whether the other non-fiscal
trends are going to cause those money sources to begin to dry up.
When you see a company like Valvoline, who has been with CART for
years, abandon ship, you have to ask yourself WHY?  They don't bail if
they think they are getting their money's worth from sponsoring a
Champ Car.  The trend the past couple of years in terms of TV ratings
and attendance has been down at most of the tracks (particularly the
ovals), and THAT trend is more worrisome than any short term profits
can offset, because THAT trend will eventually cause those profits to
shrink and vanish.

I have.  I've read all the interviews with CART's engine
manufacturers, I've read the statements about Cleveland and by
Valvoline about pulling their support, the continued dismal TV ratings
and progressive attendance drops. I've also heard CART's public
comments and those of people on the teams.  I don't know everything
and don't claim to, but I do know that I'm not "just guessing", and
I'm FAR from being the only one who is looking beyond the near term
profits at the signs of trouble ahead.  Clearly some of those included
in that list along with me are engine manufacturers and sponsors who
are currently trying very hard to reunify the series.  The writing
*IS* on the wall, and most of the people in the industry know it.
CART has a window of time in which to grow their fan base, or they
will become even more marginalized than they already are, and I for
one do not want to see that happen.  CART is easily the best, most
entertaining racing in the world (second is British Touring Cars, IMO)
and I would like to see CART stop acting like a money-collector and
start paying for some marketshare (and yes it can be bought).

Let me ask you something:  How does Microsoft bury a competitor?
Answer:  They sacrifice short term profit for long term marketshare.
If that means undercutting on price, they do it, if it means GIVING
something away, they do it.  If it means paying off people to prevent
them from going to a competitor, they DO IT.  CART's problem is they
are still trying to make money in the short term, and they are doing
so at the expense of investments they could make into making their
marketshare bigger.  Another example:  How does McDonalds boost the
number of hamburgers they sell?  Do they make a better hamburger?  No.
Spend more on advertising?  Not really.  No, they figured out beanie
babies, and they figured out movie tie-ins.  They found a way to LURE
a customer in, getting them to buy their products in order to get the
glitzy stuff that was cheap to offer.  I could list off a ton of
fairly little things that CART could do to get eyeballs on the screen
and fans in the stands....but they do NOT do them.  Anyway, I'm
probably boring everyone so I'll stop, but I see a profitable Apple in
decline here, not a baby AOL in growth.

Randy
Randy Magruder
http://members.home.com/rmagruder

Eldred

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Well, there may be an empty seat... <g>

Eldred

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Stephen

:> Hmmm? It appears all those empty seats that were so obvious on
:> tv has Carl looking for a new job.

: Bear in mind that the total capacity for Michigan Speedway is
: 112,000 seats so even if half of them were empty that still
: means 66,000 of them were full.

:> Sad to say; If Mr Craig doesnt bring more to Cart racing the
:> organization might go under??

: Hardly, Andrew Craig has brought a level of professional
: management to CART that was sorely lacking in the past.
: Under his direction CART became a publicly traded entity
: so all one need do to check on the fiscal health of the
: series is enter 'MPH' in any online stock research tool.
: Doing so will show quarter after quarter of increased
: revenue and record profits.

:  - George

For STARTERS?!?  What's your GOAL?<<

Nothing, I'm just incredibly greedy. Maybe I could buy the nurburgring.... :-)

Rob Swindells
4th in Goldline Bearing FFord Championship (12 Points);
8 points behined Championship Leader (as of round 3 of 6)

For those of you out there that claim the attendance for CART is
exhibiting a downward trend I offer the following excerpts from
the last three Goodyear Racing Attendence reports:

1996

The PPG Indy Car World Series (renamed PPG CART World Series

in 1997) raced in two new locations in 1996, at the Homestead

Motorsports Complex in Florida, and at the Nelson Piquet Raceway

in Rio de Janeiro, Brazil. According to Nielsen Sports Marketing,

38.5 million households tuned in to watch the 16 races and support

programming on ABC or ESPN. Overall, more than 2,366,000 fans

attended PPG Indy Car events in 1996.

"In the past, we have always included the USAC sponsored Indy 500

in the PPG Indy Car World Series totals," said Grant. "Since we

pulled that figure and put it under IRL's totals, we can not compare

last year's total to this year's total. Nonetheless, the series saw

attendance increases at a majority of its races in 1996. Next year's

figures will allow us to more accurately gauge CART's growth."

1997

The PPG CART World Series (now CART FedEx Championship Series)

also experienced record attendance in 1997, as it crowned its new

champion Alex Zanardi. Including debut races at California Speedway

and Gateway International Raceway, a record 2,491,050 spectators

filled the stands at the 17 events, an increase of 5.3 percent over

1996. With additional races in Houston and Japan planned for 1998

and a new title sponsor in FedEx, the series is in position to

continue with strong growth.

1998

The Championship Auto Racing Team's (CART) Fedex Championship Series

saw a season of attendance growth in 1998, even though rain impacted

37 percent of its events on the four continents the series visited. The

addition of two races, in Motegi, Japan, and in Houston, helped propel

weekend attendance estimates to 2,529,995, an increase of 1.6 percent

over 1997. CART will continue to expand its reach and exposure in

1999 when its Champ Cars race at the newly constructed Chicago Motor

Speedway in the third largest metropolitan statistical area in the

United States.

 - George

Eldred

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