Abandoned video: Address the problems in 2020/2021 (Patreon)

Hello! I wrote a script and recorded audio for a video on some of the problems (esp financial and fairness) that come out of a reduced 2020 season but I wasn't really happy with it.

It was going to come out today if I'd made it but in fact the FIA statement outlining the changes made is pretty  close to things I wrote/spoke about, so here for Patrons only is the script and audio for the not-video, should you care.

Fairness and Finances in 2020

1. As COVID 19 presents itself as a continuing threat, the high level isolation, quarantine and lockdown measures look to be sustained over the coming months, maybe longer. We can’t be sure right now. Some agencies report there will be changes to our way of life for 18 months, though the more severe policies are likely to last 3 to 6 months.
2. Have no doubt, this is a serious and dangerous matter and the more we’re able to stay shut down and isolated from each other for a sustained period of time, the quicker we’ll have this under control.
3. So stay inside as much as you can cause you’re a spreader and we’ve all seen animations of how the virus spreads exponentially as we interact with people and they interact with people and so on. Isolation is the only way. People are sick and dying and the hospitals are getting crushed under the weight of it.
4. I’m not a coronavirus channel but the seriousness of the pandemic and the measures taken across the world to contain it add to the question of how much of a season of F1 we can have this year and how much the potential tweaks to the 2020 and 2021 season will affect the running of the teams.
5. The amount of income the teams get is somewhat tied to the number of races contested this year. It’s a little complicated and very opaque but I can give you some rough shapes of what goes on.
6. An F1 team’s income comes from a variety of sources. Some of it will come from a parent company, like Mercedes Benz or Haas or Red Bull. 
7. Some of it will come from your technical partners like Shell or Dell Technologies.
8. Some of it will come from your sponsors.
9. They’ll be some other stuff like shareholders, investors and sponsors lined to drivers and stuff…
10. And then a whole chunk of it is the prize money that comes from Formula One Management.
11. I’m going to play fast and loose with the term “earnings” here because it doesn’t really matter for this, but essentially the whole of Formula One’s earnings comes to around a billion dollars. 
12. The teams, which already have a vast discrepancy in initial income, get about two-thirds of FOM’s earnings as prize money split between them by a complicated formula based on a mixture of turning up, performance, and being cool, historic or Ferrari.
13. So, here’s where a lot of question marks come in.
14. The fewer races F1 is able to hold this year, in theory the smaller FOM’s earnings will be for the year and the smaller the prize pot doled out to the teams at the end of the year.
15. How much the earnings will drop is a big question mark, depending on how many races go ahead, which ones they are and how the income coming into F1 is affected. 
16. There are championship sponsorships, event sponsorships, track fees, TV rights, F1 TV subscriptions and so on all connected to exactly what F1 is able to deliver this year.
17. Similarly, within teams, there may well be clauses from sponsorship contracts from which to argue that they aren’t getting their money’s worth.
18. So teams are looking at income shrinkage if the money flow dries up due to a lack of racing. And you may think two things:
19. One - that’s still millions of dollars
20. Two - everyone’s proportionally losing the same amount so it’s much of a muchness, right?
21. But then you have to think about what the base cost is of operating an F1 team, hiring the right staff, doing the R&D, manufacturing, travel, equipment and so on and so forth.
22. If a base operating budget is about here, then several teams start to sink pretty quickly into dangerous waters. 
23. And really we want teams operating above basic budget so they can innovate and be competitive. And ideally, we want to do that by bringing this line down, but… well, that’s another video.
24. But on the plus side, if you’re not travelling to races, running through parts, bringing staff then you’re saving some operating costs as a team.
25. There is a balance here from how much FOM get in track hosting fees to then distribute in prize versus how much it costs to actually go to that race as a team.
26. For Haas, Gunther Steiner has said, ‘if a Grand Prix pays more than 25 million dollars, we lose money. Below that, the loss is offset by not racing.’
27. Now this is clearly a pretty simplified rule of thumb but the idea is that it costs so much to go racing. And the race track pays a certain amount to FOM to host the race. A portion of that will come back to the team, so if the race fees are high enough, a team can make money by going racing, if they are low, the team will make money by staying home.
28. Again a simplified idea. Especially as the portion of the race fees will vary by team and the budget for going racing will vary by race.
29. But, with the average fees for hosting a race sitting at around 30 million dollars each it’s generally costing the teams money to sit on their backsides and not go racing, though the higher race fees are massively weighed towards races outside of Europe: China, the Middle East, Vietnam, and so on. The big, showy events massively outspend the classic european venues.
30. So what does F1 do to protect the teams - the teams they vitally need to keep the sport alive.
31. It’s looking like there will be an agreed freeze on 2022 car developments among the teams any day now. Maybe even by the time this video has released.
32. It would also be wise to get the teams to agree to use the 2020 cars for the 2021 season, however they end up doing this. It would be pretty wasteful to try and develop two seasons worth of cars when we don’t even know what’s going to happen in 2020 and especially if the rumours of how Liberty might change this season are true.
33. Chase Carey seems pretty adamant the season will roll on beyond the original November finale date. They really want to get these races in.
34. And, instead of a super season, they do want to get a 2020 and 2021 season completed separately so two championships can be celebrated and crowned. 
35. The rumours circulating mean we could have a 2020 season run as late as February. And then we’ll jump straight into 2021 after a short break. Sounds exhausting but it’s a possibility if we really do want to fit a maximum amount of races in and if we probably aren’t going to see proper grands prix again until maybe… August/September?
36. So the other thing the teams need to agree on is to extend the shutdown of the factory and headquarters. Most work takes place in the UK and Italy but nonetheless, different rules and quarantines are taking place across different countries and the safest and fairest thing for everyone is to keep the teams shut down together for the next couple of months, or whatever. 
37. It’s essentially Force Majeure at this point and no team should feel tempted to get staff back into work and if one team is locked down, they all should be. There should be a united front in this.
38. So, we’re still in the dark over how long measures around the world will take to play out and as such still in the dark over when F1 will get going and how the season will look. But if teams come together to agree to certain cost-limiting measures for 2020 and 2021 in the interest of overall fairness and financial necessity then they will be able to get through this without disaster.
39. And as we know. Teams will always come together and agree not to exploit a competitive edge in the interest of fairness, right? Right.