Edwards..Thinking about it

[Mopardh9]

Neither 21CF or Comcast or whatever corporate monoliths own the Fox and NBC networks in the coming years is going to pay NASCAR hundreds of millions of dollars to not televise their races. Nor are they going to breach the contracts that are signed for that period through 2024.

Why wouldn't they breach?

 

[gnomesayin]

NASCAR would have open-and-shut cause to sue them for damages above and beyond the value of the contracts, and any network that did that might as well write a suicide note alongside declaring their intention to breach. No sports league or entertainment property would ever sign a deal with such a network again.

 

[gnomesayin]

None of this is to say that the networks, particularly NBC with its less attractive, more expensive late season package, might not become increasingly desperate and push for more short-sighted changes that will further erode the sport's credibility.

 

[Team Penske]

After General Motors filed for bankruptcy protection I would never bet 100% against anyone doing it. Having said that Nascar has no financial problems and they are not just based in America.
Right now they are downsizing and will hit a plateau that is still profitable for Nascar, tracks and the teams.

 

[aunty dive]

What happens if Monster bails early?

Nothing happens to the 2 major track operators if Monster bails. NASCAR would lose 1 of many revenue streams.

The TV partners will still be there in the last year of the current deals.

 

[Charlie Spencer]

For how long?

For tax deduction purposes, major improvement costs are usually spread out over 7 to 10 years. The track owners obviously expect to get that long or they wouldn't have spent the money.

 

[Skoalbandit33]

Monster's presence as the title sponsor isn't the important factor. They are reported to be paying $20-$25 million per year and are only signed through 2018. I would guess that most analysts believe it is a distinct possibility they won't be the title sponsor by 2020, let alone 2024. If they go away, another company will replace them and may pay even less. But even if that amount was $5 million annually, this is not the revenue that is propping up the whole enterprise. That would be the $700+ million of annual TV rights money that is locked in.

Well there is no guarantee that will be there either, that's until 2024 also correct? If NBC or Fox opts out, which i think could very well happen Nascar is done.

All bets are off when the TV deals expire after 2024, yes.

To the best of my knowledge the current broadcast deal ensures that the tracks don't need to sell one beer or put one butt in a seat in order to remain profitable so things are good for another 7 years. Of course it is possible there could be provisions in the language of the broadcast contracts that allow the networks an out or a formula to pay less should certain numbers not be met.

When the current broadcast deal was signed the prevailing thought was that the sports channels of NBC and FOX would be able to recoup a lot of their investment by being able to charge cable and satellite providers more money to carry their sports channels but I don't believe that has materialized. The alarming thing is that Nascar world is undergoing extreme belt tightening while operating under the protection of the broadcast deal so if those dollars end up getting severely cut in the next deal the official day of reckoning will begin. At that point all the tracks would become gate driven and with less people showing up to the track each year it would be problematic. There is a lot of time to go yet but Nascar needs some wins along the way instead of the constant losses.

Nothing happens to the 2 major track operators if Monster bails. NASCAR would lose 1 of many revenue streams.

The TV partners will still be there in the last year of the current deals.

I would not make any absolute statements about how long how long FOX and NBC will be around for as neither one of us has seem the contracts that were signed so we don't know what provisions are in the deal to protect both Nascar from the networks and the networks from Nascar. Contracts are broken or modified every day after all. I think one possibility is that FOX and NBC both extend the deals at a significantly reduced price and average out what the deals are really worth over a longer period of time. JMO.

 

[StandOnIt]

Or you could read their financials and be fully informed.

That doesn't work in the what if world. That is black n white public knowledge by a public company with stockholders.

 

[aunty dive]

The bottom line is that the 2 major players in the track business are making money.