Thursday, September 11, 2008

Live Nation sells Supercross with motor sports division

No surprise here as Live Nation has sold off its entire motorsports division to Feld Entertainment in a deal valued at $205 million. The sale is the latest step in Live Nation's current corporate gin rummy hand — the predictable, cyclical business of first acquiring unrelated businesses to "leverage synergy for increased profits and growth" and then, a few years later, selling them off to "release pent up value for increased profits and growth." Funny, that.

We have stated here before our position that Live Nation had very little, if any, corporate commitment to Supercross and that believing otherwise was naive. At best there is only marginal synergy between motor sports events and music concerts. Live Nation have known this since their inception as a spin-off from media conglomerate Clear Channel at the end of 2005. In 2006 they began selling off everything that was not "core" to the music concert business — including theatrical shows, sports representation, and real estate. The company has now sold off more than $460 million in non-core businesses.

With Live Nation completely out of the Supercross business, who is in charge? Feld Entertainment, the parent company of Ringling Bros. and Barnum and Bailey circus, Disney on Ice, Disney Live, and other live attractions.

What is most interesting about Feld is their description of themselves:

Feld Entertainment is the worldwide leader in producing and presenting live entertainment experiences that lift the human spirit and create indelible memories, with 30 million people in attendance at its shows each year.

This is clearly not Live Nation &mdash the company that promotes Fergie, Rob Zombie, and Madonna among dozens of others. I haven't seen a self-promo that corny in years. But maybe it's time we had someone in charge of Supercross that at least has a clue what the term "family entertainment" means.

The entire Clear Channel/Live Nation episode of Supercross history has been a gut-wrenching experience for true motocross fans, who watched as their beloved sport turned into a cartoon-like caricature, a frenzy of near-naked girls and violent crashes feverishly pitched at hormone-addled 18-year-old boys and pro wrestling fans.

Yes, the sport grew. Yes, it brought in more money. Yes, a handful of riders can now make contracts well into the 7-figure range and a good number more can make nice 6-figures. But yes, it also become "sports entertainment", just like monster truck racing and the WWE. I don't know that Feld intends anything differently, but I feel no loss for Live Nation.

For now, Feld says they will keep everything intact at the Aurora, IL HQ of the former Live Nation Motor Sports, including all management, schedules, partnerships, and structure. Changes will likely begin late 2009, as Feld gets a feel for what they do and do not like about the new business.

There are many, many possibilities for the future. Far too many to cover here, and at least as many bad as good. But one thing we can be sure of, nothing stays the same in these scenarios.

Sunday, August 10, 2008

Ducati ownership changes

Back in February I did a little profile on Ducati based on an article in Cycle News. You may recall that Harley-Davidson made a run at buying Ducati late last year, but the move was quashed by the investment group Investindustrial, which owned a significant, but not controlling, portion of Ducati stock.

H-D has since satisfied their craving for a European marque by acquiring MV Agusta. And now it appears that Investindustrial has insulated themselves from foreign management by putting together a larger private investment group, Performance Motorcycles S.p.A., which consists of shareholders Investindustrial, BS Investimenti and Hospitals of Ontario Pension Plan (HOPP). According to the press release:

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Sunday, July 27, 2008

Smart money says new AMA Pro Racing will get it right

The entire professional road racing community has been up in arms since DMG (now officially AMA Pro Racing) began making their presence felt. The complaints have been long, loud, and many. A person less magnanimous than me might even call it incessant whining. But I won't do that. I understand what all the furor is about. The road racers were, more or less, happy with the status quo, and DMG have begun shaking that up — not always in a positive direction. But in MX and Flat Track the situation is different.

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Mike Kidd chosen to lead AMA Pro Flat Track

AMA Pro Racing (the new AMA Pro Racing) announced Thursday that long-time, old school flat track racer, former AMA Grand National Champion, race promoter, Motorcycle Hall of Fame member, and Texan Mike Kidd has been chosen to head the redevelopment of the national flat track program. This is good news. Kidd has been around the block more than once and knows the flat track business. He's also seen the ups and downs of race promoting, being one of the first to bring racing to the small arenas in the mid-'80s.

I love flat track — watching those big Harley XR750s pitched completely sideways at 100mph in a mile race is awesome. The old AMA's apathy toward flat track was exceeded only by their apathy toward outdoor MX. Flat track is a genuinely American form of competition and deserves much better. I've read that AMA Pro Racing's Roger Edmondson is a big flat track fan, and this move to bring in Kidd is encouraging.

Kidd has done some very innovative things in his promotional career, but it seemed he never really had the big bucks behind him that he needed - even though he had the backing of Clear Channel for a while. It just didn't work. But now that he's got the backing of a group with both money and a love of the sport things could be very different. I hope so.

Thursday, July 17, 2008

Davey Coombs wants to make outdoor motocross cool again

I just read the interview with Davey Coombs in the new Cycle News — Issue #29, July 23, 2008 — talking about MXSports, outdoor MX, Barber Motorsports Park, and the future of motocross and the outdoor series:

We want to make motocross as cool, as competitive, as entertaining, and as safe as possible.

Live TV, improved facilities, adding new venues, listening to riders, listening to fans, taking a business approach that admits we have to modernize but recognizes motocross has its own unique value — that it does not have to be Supercross, just in the daytime.

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Sunday, July 13, 2008

Long live the two-stroke Part Deux: FUD in the marketplace

Two-stroke technology is not banned. Never was. Yet this myth continues to run rampant over the internet. Two-stroke technology is changing, getting cleaner, but this is a story about how purposeful misdirection and a campaign of Fear, Uncertainty, and Doubt created a myth, killed development of a promising technology for over a decade, and changed the face of a sport.

Let's assume that a large, multi-national corporation (for simplicity we'll use a fictitious entity called Company H) manufactures everything from inexpensive lawn mowers and power generators to motorcycles and $40,000 SUVs. Every item in their massive product line is powered by a four-stroke motor. Every item, that is, except a small group of dirt bikes. The company has enormous investments and intellectual property in the development, marketing, and sales of four-stroke-driven products.

Company H is aware that certain proprietary methods, techniques, or technologies for lowering two-stroke emissions are either available or under development, some by their primary competitors. But Company H doesn't own any of the intellectual property (patents) associated with this improvement. Further, two-stroke engines do not fit the company's financial model — costing extra for development (since they can't leverage their vast institutional knowledge of four-strokes) — while generating lower margins in sales and service parts.

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