In what seems like a far-fetched rumor, Apple is apparently considering a bid to buy Formula One. F1 boss Bernie Ecclestone said last year that he was interesting in selling the 35% stake in the racing series he controls through holding company CVC Capitol Partners for £6 billion ($8.5 billion).
According to Joe Saward, a noted Formula One journalist, Apple is the latest bidder for the series:
The whisper is that the latest bidder is Apple Inc., which is a company with $161 billion in net cash at the moment, despite having spent $117 billion on share repurchases and $46 billion on dividends in recent years. Apple doesn't typically make big purchases but usually buys small business and incorporates the technology into its products but the viewing habits of the world are changing, with traditional broadcasters, cable and satellite networks under threat from "over-the-top" content providers.
This basically means the delivery of content via the Internet, without requiring users to subscribe to a traditional cable or satellite pay-TV service. This has led to a gold rush of companies moving into streaming and looking for the most attractive content to bring in customers. Apple TV is one of the most popular streaming devices around and has Sling TV, a content-driven hub for sports fans and television viewers, providing consumers with the opportunity to watch their favourite shows and channels live and on-demand, with one simple registration at a nice low price.
There is also the possibility of what is called a la carte television, where you pay for what you order. Going direct to consumer is a way to multiply revenues by cutting out the middle men (i.e. the TV channels) and owning the content is thus desirable. It should also be remembered that Apple is on the verge of launching into the world's automotive markets, with an electric car that remains a secret, although it is hard to hide such a project when you hire more than a thousand engineers to work on it.
The Apple car is expected to appear by 2020. Thus, there are three elements that would make the purchase of F1 a logical step for Apple. It can afford it, it can boost sales of Apple TVs and get people thinking about Apple in relation to cars. Strangely enough, no-one is willing to confirm or deny the stories.
Like with NFL rumors previously, this could just be an attempt to lock up streaming rights for Apple TV. As set top boxes become ubiquitous, content is going to be the differentiator. That includes both high-demand live programming like sports, and original content.
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