On Thursday during the Performance Racing Industry show in Indianapolis my phone began to blow up. By Friday it was nearly hot to the touch. The rumor mill had started, but there was one notable difference this time around.
On Thursday during the Performance Racing Industry show in Indianapolis my phone began to blow up. By Friday it was nearly hot to the touch. The rumor mill had started, but there was one notable difference this time around.
All the potential inside scuttlebutt I was receiving was certainly plausible because much of it was based on substance. Of the so-called bombshells that came during PRI, nothing had the impact quite like the announcement that World Racing Group had created the Xtreme Outlaw Midget Series and the Xtreme Outlaw Sprint Car Series for non-winged sprint cars.
There seems to be little question that the emergence of live streaming as a significant revenue generator is a factor here. In fact, one ponders what might have been if the World of Outlaws and the United States Auto Club operated on the same platform. How all of this plays out is truly going to be an intriguing drama.
The initial reports suggest that WRG will work in a non-competitive mode with USAC and POWRi. Yet, many wondered how long that cooperative spirit would last. Some quickly dubbed this as the end of USAC, which seemed particularly premature. I‘ve been around long enough to be told that the grand old club had received Last Rites about 10 times.
All of this came on the heels of Kevin Thomas Jr. and Chris Windom announcing their respective moves to winged sprint car racing this season. Does that serve as a death knell for USAC? Hardly. Remember when people wondered if the World of Outlaws could survive after Steve Kinser, Sammy Swindell and Doug Wolfgang? I think they have done just fine. Drivers change and new stars emerge just as it always has been.
The 2021 season was a good one for USAC. There were more than 90 national races contested under the USAC banner, one of the highest totals ever. The total prize money earned by the top USAC stars compared more than favorably with the All Stars. How lucrative oval track operations were for USAC is a different question and an interesting one given the club‘s non-profit status.
As a sidebar, with persistent reports that USAC was about to be sold, it left one to wonder what does a potential buyer receive given the sanctioning body‘s club status?
I have spent a fair amount of time pondering what these moves may mean for key stakeholders and fell back on one of the most basic of analytic tools. A SWOT analysis can be useful in nearly any type of organization; in fact, it isn‘t a bad thing to use to think about your personal situation either.
The key terms to consider here are Strengths, Weaknesses, Opportunities and Threats. WRG went through some form of this exercise even if it was simply brainstorming around the table. USAC, POWRi and even groups not directly impacted, such as the All Stars and ASCS, should be looking down the road as well. That self-analysis should be ongoing. The fine folks at Underwood Typewriters and Blockbuster Video once thought they had the world by the tail, too.
It seems like new racing clubs are launched every year. For the most part, the overall impact on the racing landscape is minimal. This is different. USAC occupies three distinct spaces as the industry leader. Among the USAC national series, the Silver Crown tour is uniquely theirs and when it comes to traditional sprint cars and midget racing, they are the major league.
No one disputes the primacy of the World of Outlaws in terms of fan interest, media coverage and prize money. That is a key strength for WRG. Is delving into wingless sprint car and midget racing an opportunity?
Clearly, WRG officials think so. Will it draw more eyes and dollars to the series directly or indirectly? Perhaps. Does it reduce a threat? It certainly would not appear that USAC or POWRi was a concern, unless the item of interest is live streaming viewership. Could this new venture spread WRG too thin? There are myriad examples in the business world of the deleterious consequences of straying too far from home.
From the USAC perspective, things just got dicey. Despite of all the verbiage about non-competition, should this development be viewed as a threat? Yes. Can this changed landscape represent an interesting opportunity? Maybe. USAC has a good product. While it might not be as universally appreciated as the WoO, it has a constituency and a strong niche.
Knowing who you are and appreciating your base is an important consideration in motorsports. It bears noting that the All Star Circuit of Champions came into Indiana last year amid great fanfare. They have a good product, too. However, at press time the All Stars did not have a single date scheduled in the Hoosier State in 2022.
Late model racing is extremely popular. Yet, what draws a big crowd at Indiana‘s Brownstown Speedway has been generally greeted with yawns at Bloomington Speedway. It is worth pondering if over the course of 10 to 15 new events as envisioned by WRG if the profile of these cars and drivers can be enhanced. With more money up for grabs, one of the true beneficiaries should be traditional sprint car and midget teams. USAC can certainly profit if broader exposure to this style of racing translates into an increased demand for this product by race organizers and the general public.
As we head into this season, it will be fascinating to watch all of this unfold. USAC announced a robust slate of races and an enhanced purse structure. In addition, it was also revealed that a $150,000 bonus was up for grabs should a driver capture two national championships and $300,000 if one can somehow join the likes of Tony Stewart and J. J. Yeley and wear all three crowns in a single year.
The World of Outlaws have plenty of momentum, so don‘t expect them to miss a beat. One question does loom. How much will it cost to stage a World of Outlaws race with the addition of traditional sprint cars or midgets to the card? Not all tracks can make an Outlaw show work economically. Finding the right price point is also critical consideration not just for in-person entertainment but also for streaming packages.
As years go by, fewer people recall the days of the tire wars in the Indy car ranks. As Firestone and Goodyear fought for supremacy a great deal of money was poured into the series. It was good while it lasted. Do you ever wonder if a sport like Major League Baseball can survive if they continue to offer star players four-year $150 million contracts? If the television revenue remains high, the answer appears to be yes. Will this continue into perpetuity? I doubt it.
If all of this movement is predicated on what live streaming can generate that feels a bit like building a house on a shaky foundation. However, if the trend continues in a positive direction what other players, consolidations and mergers may result?
As I heard a lot of this unfolding in downtown Indianapolis, I turned to a friend who works in the industry and suggested he keep an ear to the ground. A lot of people can be impacted by shifting sand in the next few months. Some day we may look back and realize that a simple announcement made in mid-December changed the trajectory of the sport.