Dario's Lab

2011 retrospective Part 3 of 4

Needless to say, this turn of events was surprising and extremely disappointing because the athletic and technical sides of the team had grown to be truly formidable.The record shows the calibre of the names involved. Perhaps more importantly in such a collaborative undertaking, promising constructive relationships were growing within the group.
The sailing and shore teams had already fitted out and assembled their first race boat at the regatta venue after completing a training camp in home waters.
The design team had put in place the test matrix and was already well into the calibration work necessary to home in on the optimum parameters for the bigger boat. Once again a lot was learned, but this time we had gone much further down the path.
We began functioning as a team and felt confident we were headed for great things.
 
Reflecting on the commercial proposition of the 34th AC, one cannot help but notice that a radical transformation happened by degrees, in a way that was not immediately apparent at each incremental step, but which added up to a format very much at odds with the initial premise.
 
As things stand, one cannot argue convincingly in favour of the commercial viability of the format. 
The balance of power has also shifted away from the interests of commercial teams, in favour of large privately funded entities that effectively hold the keys to the field of play. 
In this framework, it is easy to imagine that ‘some animals in the farm are more equal than others’. 
It is tempting to say ‘it was ever thus’, but this incarnation of the Cup has morphed beyond the reasonable expectation of politics, lobbying, intrigue and power-plays that are part of AC folklore. 

A confluence of years of play stopping litigation, the economic times, a ‘non-establishment’ vehicle, and, perhaps most significantly, a Challenger of Record that was ‘friendly’ to (and possibly dependent on) the Defender (and has in any case left the picture), points to an interesting moral hazard in relation to the funding of both the event and prospective teams.

The unprecedented combination of a participating team also supplying (through entities that purport to being independent but share a common funding source) the equipment, and having mechanisms in place to unilaterally penalise other parties, makes for an extremely uncertain situation for someone who is considering investing in order to gain a return (whether monetary or in the form of patriotic prestige and sporting satisfaction). 

This point is worth pondering if it is really to sink in: the defender is supplying equipment to prospective challengers that can be admitted and sent off at will through thinly veiled rule pretexts.
I want to be clear that this is not a naïve idealistic realisation: politics and deal making have always been a part of professional sport. But in this case the picture is extremely unbalanced. 
Instead of Challenger and Defender doggedly negotiating, each in the self-interest of securing the best chance to win, you had first a Challenger that was more interested in securing hosting rights than actually racing and winning. Then a ‘puppet’ Challenger. And finally a Challenger relying on financial backing from the Defender.

As a small aside, let us remember that we are talking about professional sport. Professional does not mean ‘full time’. It means that the people involved do it for a living. Meaning they get paid. In turn this should mean that those providing the money should expect some value in return that is commensurate with the investment. This requires arrangements to be dependable and transparent, with knowable costs that should be subordinate to the value being added. 
In a commercial reality where value for money is at a premium (since the need to spend on tax-deductible advertising is negated by slim or non-existent margins), a bold new proposition should offer as many certainties as possible to entice genuine investment.
 
And there is no question that the new AC format is bold and different if not new. 
It brings to the forefront the spectacle, excitement and technology that were once hiding in a niche of our sport (namely the C Class and, to a lesser extent, the A class). 
In my opinion this fulfils the spirit of the AC as a pinnacle of international competition and a crucible for the development of performance under sail. 
Yet these premises are contradicted by mandating a conservative one-manufacturer/one-design for a period much longer than the anticipated ‘hit the ground running’ introductory bracket (leaving aside the dubious implications this revenue stream has on the fiduciary duties of the Trustee/Defender). 

Along the way there have been radical policy changes in the declared profit centres of the business model, particularly with regard to TV and venues. 
The calendar still has gaping holes in it, and the eventual race boat rule does not address the original promise of containing costs where they do not lead to outright performance or where they are absorbed by minute gains. Specifically, the AC72 rule started out admirably by restricting the key speed producing factors and imposing equipment limitations. But subsequent changes have driven up initial and ongoing / logistical costs beyond recognition whilst simultaneously the value available through exposure has dwindled.
Again, the AC has never been ‘cheap’, nor should it be. 
The issue is not the size of the investment but the relationship between investment and return. 

The graphics and television coverage are remarkable and technically brilliant. 
But, as with any project lacking pre-defined benchmarking, it is impossible to judge how much better the results could have been, or what would constitute an unremarkable result or a failure. 
The commercial considerations that should come first and foremost if viability and sustainability are the goal seem to be forgotten: the true measure should be efficiency – the value for money to a stakeholder represented by what is being produced against the cost of producing it. 

In this context I am surprised at the apparent willingness of commentators to marvel about technical excellence without reference to the resources available. 
Given enough money to hire enough talent, technical excellence should be expected, not marvelled at. 
Technical achievements are of course admirable, but they are even more so when they dwarf the available resources. 
That is why TNZ beating the Americans in 1995 on a shoestring budget and with wooden wings on their bulb is more remarkable than America^3 winning in ’92 with a virtually unlimited budget… 
One would do well to examine the quality of the Extreme 40 coverage that uses radio controlled UAV’s and other ideas that save money to increase the value on the bottom line.
 
But one must not dwell… The experience was fulfilling and worthwhile. 
For sure similar chances will arise again in better times. 
Right now the lessons learned are valuable and I intend to apply them to our other work whilst sharpening the focus for 2012.