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The Business Models of Olympic Sailing and How Kiting May Actually ‘Save’ Our Sport

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There has been incredible response to the blockbuster decision for ISAF to remove windsurfing from the 2016 games and replace it with Kitesurfing.

This post will not discuss items like lack of communication with current windsurfers, kiteboarding safety, mothballing for federation bic techno gear, the athletic peak of sailing being the windsurfers, or how this switch likely reduces the diversity of sailing in the short term.

Instead, this post will focus on just one item that is being banded about on the windsurf/kitesurf flaming boards.  That item is the business model for Olympic sailors.  The kiters are proposing to use and ‘open 3 by 1’ rule, where 3 kites and 1 board can be measured into a regatta.  This is counter to the current ISAF sailing model of strict 1-design like the current RSX rule where every person sails on the exact same equipment.  There lots to discuss in terms of creating a fair playing field, but again, I’d like to focus on the business model.

Currently: The default business model for Olympic sailors is the Olympic advertising from NBC and others goes to the IOC to ISAF to MNA to NSA to Class to Sailor model… sorry for all the acronyms.  The money flows from the Olympics to Sports to Countries to Sports to Classes to Sailors… assuming every organization takes a cut to ‘administer’ their mandate… you can see why the $6B NBC puts into each games isn’t making any Olympians rich (directly).  For the most part, top sailors are getting their budgets paid for to compete in this model.  The odd sailor may even take home  a salary, but those sailors are the outliers and not the norm.

Open Supply: The kiters are saying, that their proposal will put more money into sailors hands.  By keeping an kiting as an open rule, it will allow the equipment manufacturers to compete via athlete proxy.  The commercial rewards for companies ‘winning’ will drive huge $ into top sailors hands.  Indeed, there is much anecdotal data to support this.  There are big sponsorship budgets in the kiting business.  ISAF member and the evaluation committee were said to be impressed by the pimped out vans the kiters use to support their brand sponsors.

Further, windsurfers from the PWA tour know this scene well as there is a similar business model used to compete in the Formula board circuit.  In the formula 18 catamaran circuit, there is also a good sponsorship model with the big 5 brands all using top sailors to promote their boats on circuit.

There is the suggestion that the World Cup Circuit format and Olympic format will itself will undermine the open business model.  The open business model of companies competing with each other doesn’t work without having fans or media who care about the racing.  The anaemic coverage and lack of ability to view the World Cup circuit means that there is little money generated by anyone in sailing other than through sailors buying their equipment or attending their events.  If your entire market is only sailors and excludes the rest of the world, it’s safe to say the potential is limited.

Now back to marrying a business model to the Olympic format.  One thing is certain and in one design racing – sailors are buying their equipment.  There is little to no incentive for a one design manufacturer to sponsor any sailors… the sailors are their only customers.  In the ‘3 by 1’ model the kiters propose, the manufacturers will presumably sponsor many of the top sailors for their equipment in hopes of having the rest of the fleet and worldwide kiters in general buy their gear.  They say that top guys will sell down their rejected or 2nd had gear to those lower down in the rankings, a trickle down effect.

Having lived within one design classes and seen the extremes sailors go to when selected from ‘identical’ kit, I can only imagine the anxiety sailors will have when there are no bounds to what they can get… big teams and big budgets will surely be spent on.  Team GBR is already legendary for reported spends of $100,000 on one mast for Shirley Robertson and $1M of redundant Star gear from Ian Percey’s campaign and the switch away from the Star… and these are spends within the one design arena.  ISAF is proposing to regulate the market for gear somewhat by making sure any gear is available to any kiter, that would certainly help a lot.

Recently, the Volvo Ocean Race has made their fleet one design, and there is a lot to be learned from their experience.  When the VOR 70 came about, designers got to work and explored the rule… wonderful designs and enhansements have been developed… not a decade in, the organizers are taking those advancements and rather have teams spend more money on micro-developments have one-designed in the best pieces reducing the cost for the future.

Some model like this would suite the Kites well.  Leave the ‘3 by 1’ rule in until after the 2014 worlds in Santander… after that, see what brands finished as the most popular and only allow 3 or 4 brands to one design equipment for the games… The competitors use 1 design for the final 2 years and then it opens up again after 2016.

There is much to learn from what the Volvo Race has done, and this is just one more piece… hopefully the Moth class will do the same and get one of their boats into a future Olympics.


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