Forum: HoseHeads Sprint Car General Forum (go)
Moderators: dirtonly  /  dmantx  /  hosehead

Pay per view revenue. Any other questions?

I wish I knew how to make all the words different colors.

It's my understanding, that the WoO are puting this race on, not Knoxville Raceway.

Per the information provided to media. This event is 100% a WoO show. They are renting the facility and putting the show on themselves providing the purse money. Knoxville is not paying any sanction fees or purse money. Knoxville receives none of the Pay per view money from this event. 

The truth is the purse can't be covered .     This model of racing without fans in the stands is not sustainable.  If the Outlaws are renting the track then that shows that a track can't afford to have a race without fans.  Because the Outlaws aren't going to wave or lower the sanction fees for tracks.   The Outlaws have a business model and they need revenue to maintain that business.

Simple math will tell you that PPV will not bring enough money to sustain the model of fan less races.

Just to make the math simple.  Assume 5000 fans at $30 a ticket which is $150000.  So to equal that much revenue 5000 people would need to purchase the PPV for $30.  And it might have that many people buying right now because people want to see racing. But how many are going to spend $20 to $30  per race?  I would say not many of us.  Why do all the services offer a yearly plan because it is a better value for the consumers.    So in my opinion it is not a workable plan to assume fans will spend $20 to $30 when a yearly package is what $5 or less per race.     And what stops one friend from buying the race and their friends come to the house and watch the race.    The only way fan less racing works is 5000 people at the track are the same 5000 that individually buy the race.

I think we all know (well I hope most know) that this is not going to be sustainable or that it will be the new normal. I think this is a move to just get something on the track anyway they can. 

The reality is the month of May is basically a no go for having fans in the stands at any scheduled tracks or in any sprintcar hotbeds. Considering they are talking about NFL & college football games being played without fans in 2020, it might be writing on the wall it will be the same for racing. This move is more of trying to keep WoO moving anyway possible. Does that mean break even or operate at a loss? Only they can answer that. I'm sure they are & everyone are itching to get people back in the stands but a lot of that is out of everyones hands so we have to make adjustments as best as possible

I'll throw some hypothetical numbers out there... may or may not be that close to reality... but what the hell!?

The Outlaw purse at Knoxville last June =$50k a night.  

Track rental (total guess here) = $50k -- the track would have to pay for insurance, electricity, local officials (ie, flagman, people to sign in the drivers, etc), and track prep... nothing else.  Could they make money on $50k rent for one race??  Hypothetically, I would hope so.

Back gate fees (4 pit passes average per 48 teams = 192 pit passes x $40 = $7,680

The total the WoO need to get from PPV to break even is the $100k purse and rental less the $7,680 back gate fees = $92,320

If the WoO did NOT have the $40 monthly Fast Pass, they would need 3,078 PPV purchases (from every race fan worldwide -- sequestered at home, bored out of their ever living mind right now -- that has access to moderately fast internet) to get to that break even point -- 3,078 x $30 = $92,340.  

The cost of a fast pass is $40 a month.  How many subscribers do they have ???... again, worldwide, any race fan (sequestered at home, bored out of their ever living mind right now) that has access to moderately fast internet.  30k subscribers on the low end... 40k in the middle... maybe 50k or more on the high end?  30k subscribers = $1.2M a month... 40k subscribers = $1.6M a month ... and 50k subscribers = $2M a month. 

Not counting a single person paying a $30 one-off fee to watch (very unlikely, but possible) ... and 30k Fast Pass subscribers... that's $1.2M a month.

If the WoO put on just 4 shows a month (Knoxville, I-80, Jackson, and I-55 ... examples) ... rented the tracks, no fans, just PPV.  Their break-even cost (using the numbers above) would be $369,280 for those 4 shows.  If they went crazy and scheduled 2 shows a week (8 in a month), the monthly break-even cost would be $738,560.  The more shows they had in a month, the more value a Fast Pass would hold... so the 30k Fast Pass subscribers would maybe jump up... maybe double to 60k, at least in the short-term.  That would be $2.4M coming in per month.

A wild card with this is sponsors... how much is Drydene paying the WoO to be the title sponsor of DirtVision??  It's could be a sizable amount.  How much is NOS paying too??  I have no idea, but they're not free.  The WoO also has to advertise a little... but I would not think as much as if they were trying to attract a person to buy a ticket to walk through the front gate.  One could argue that their 20% discount on new Fast Pass subscribers or 20% discount on a $30 one-time PPV purchase on May 8th could qualify as an advertising cost. 

Hosting a WoO show with no fans, could a track pay the $50k purse, a $50k sanction fee (total guess there), plus their other overhead costs... with no PPV revenue share... no freakin' way!  Sponsors would help, but it would have to be an amazing $pon$or.  I don't think the WoO is willing to give any of the PPV revenue share... so I think this is where we're at (for now... hopefully not long!!!).  It could end up being beneficial to everybody if done right... IMO.

A shame they can't have fans. Knoxville is the one track in the country that has enough grand stand capacity to seat thousands of people 6' apart and still no fans?

 
 
 
They don't even know how to spell sprint car 
much less chromoly...http://www.ycmco.com

Exactly,  a weekly show at Knoxville  (in the stands) front stretch  and I think back is closed... is social distancing 101.

My guess is that Knoxville opens to fans as currently planned on May 16.   

I believe that this a test run to prove to state and county officials that this part of the show can happen safely....it is the toughest part of the whole deal.   

I agree this would be the best place to give it a shot.  The problem is getting all of the average fan to listen once they are in the facility.  I think the average American is so dumb right now, they would screw it up on the first try.  

WTF difference does it make.  Theyre racing, and if you want to see more, Id suggest supporting the PPV.. I will/

Freedom is the first thing that comes to mind to me, watch all the ppv  you choose however explain how 4 or 5 people working on a race car is safer than let's say 3000 people in a 20,000 seat stadium . 

It’s not. It’s rediculous. But it is what is allowed right now. So let’s keep moving forward with what we can. 

" I think the average American is so dumb right now"   Wow..... think much of yourself?

Once again, I think George Carlin said it best.

If anyone has Floracing and watched the first of three nights of no fans in the stands Late Model racing last night they saw an interesting twist.  Sponsors were literally calling in donating to a front row challenge that grew to over $25k with each donation announced in real time.  There are a lot of sponsors, businesses and individuals all over the US wanting to help jump start racing right now.  While I don't expect the Outlaw race to take on the appearance of a telethon like that Late Model race did I'd guess that there must be an avenue for those wanting to come on board and help make this event happen.

That is the kind of cooperation and support it's going to take for the short term to get things going again.  I believe that the business model of offering multiple races at a low cost aka package deals like fast pass work against the PPV only situation.  None of us know the bottom line of any of the parties involved but we can all surmise that money is tight right now and they have to be innovative and think outside the box.  

Stan Meissner

That LM race last night was entertaining with all the last minute call in's pledging money, it was heartwarming to see signs of life in the racing industry!    The actual racing had it's moments too,   I am pretty sure that I have never before heard the phrase "Is he going to open a White Castle and throw a slider?"

But it shouldn't be called the Front Row Challenge,   TMac (rightfully) pointed out on Twitter that it is a registered trademark....and with everybody calling in and offering cash bonus's on their own terms, it turned into the Top 4 Challenge.   

I don't think Knoxville or anywhere else is going to be able to open until there are plans in place for proper social distancing.  Everyone is focused on spreading out the crowd in the stands, but the focus needs to be placed on the concession stand, beer stand, bathrooms, enetering the facility etc.  Once there is a realistic policy in place for that along with seating in the stands that is realistically able to be enfroced you'll see more stuff open.  That is the same issue for movies and other entertainment venues. 

Let me give you an example:

In my wonderful state of Illinois, our Governor has made it illegal to be in a place of business without a mask---effective today.  So, agree, or disagree, these businesses must abide by the rule/law.  So, this morning my daughter has to go to work at the local gas station and is mortified of the response she is going to get as her boss has already told her not to serve anyone not wearing a mask.

So, this morning Facebook is blown up with people being told they will not be served at various businesses all over the county.  They are never going back, can't believe this is America, ripping on the employees who told them the policy, on and on and on and on. 

So, yes, the average American is dumb right now.  Why rip on employees that are doing what they are told by their boss?  Why ban Menards because of their policy following the health officials guidelines?  And, even worse, the employees trying to take home a paycheck?

To be real honest, I don't think the masks will do shit.  But, I'm going to wear one, because it's the law and I don't want to put some of those hard-working people in a bad spot.

So, let's translate this to the race track.  You're going to take these same idiots who have no regard, or respect for any type of authority or people just doing their jobs, and put them in the stands at a race?  And expect them to do the right thing?  No.  They're too dumb at this point.  The first race with fans would likely be the last because they wouldn't be able to put away their pride for 3 hours and not ruin it for everyone else.  

I would not be one of the "average."  I would follow the guidelines----so, I do think much of myself.