The numbers didn't add up for Team Sky's new bean counters
The cycling phenomenon that is Team Sky will roll to an end at the close of the 2019 season, a decade after it launched and went on to change the face of the sport.
Along the way the juggernaut that Sky Pro Cycling became made Great Britain a dominant force in professional cycling, track cycling and encouraged thousands to take up the sport as a hobby.
But its commitment came at a cost to the media organisation that bankrolled it, and more than £150 million later, Sky has decided to pull the plug, claiming that sponsorship of Team Sky had “reached a natural conclusion.”
It would be easy to blame the the drug scandals that have blighted the team over recent years for this decision, but that would disregard one key factor - Sky PLC has new owners.
When Sky Pro Cycling was founded back in 2009, Sky PLC was a pillar of the Murdoch Empire and Rupert’s son James was chairman. He loved cycling and he was obsessed with his bike. Just as we have all done when we get hooked, he took things as far as he could.
Which was about as far as anyone could take it - Team Sky was established on his watch and he green-lighted the allocation of millions of pounds towards it. By 2016, the team budget was £31.1 million, more than double the £14.6 million budget it launched with in 2010. Team Sky had the resources to experiment with new methods and under the leadership of Dave Brailsford it had the confidence to go out and do it. Enter marginal gains, the practice of bolstering rider performance with seemingly innocuous adjustments to diet, sleeping arrangements, pre and post-ride activities and so on. These have been so effective that many aspects of marginal gains have been adopted throughout the sport.
The vast sums available to implement these and other strategies such as cherry-picking the best talent, paid off massively for Team Sky. It has dominated pro cycling, much to the chagrin of the French, producing six Tour de France titles between three winners including four for Chris Froome and multiple other wins on the racing calendar.
As any pro cycling team owner will tell you, success does not equate to money in the bank, such is the broken economy of cycling, and Team Sky will not have seen much change from its £150m spend over its ten years of existence.
It is no coincidence that in September 2018, ownership of Sky PLC transferred to Comcast after it paid £30bn in a bidding war that came out of nowhere and blew Disney out of the water. As the new owners walked in, James Murdoch resigned.
Many considered the Comcast bid to be too high, including the shareholders, many of whom sold out. Comcast’s share price plummeted.
The ending of Sky’s funding of pro cycling so soon after the Comcast takeover looks like the result of Comcast accountants trying to cut costs. In the face of any accounting scrutiny it is obvious that £30 million of annual marketing outlay is an indulgence too far.
The team’s recent hammering in the press and social media over jiffy bags containing Salbutamol and before that the release of details of Bradley Wiggins’s corticosteroid injections by the Russian Fancy Bears hackers could have helped validate any decision to pull funding, but ultimately those costs were just too high.
For Comcast, Team Sky is an unnecessary expense on the balance sheet of the company it paid well over the odds for.
At the end of the 2019 season, Team Sky will be looking for new owners. It will be a terrible blow to the sport, because whether you love them or hate them Sky’s involvement in cycling meant more than money - it was proof that cycle racing was worthy of investment. And look what it achieved.
Sponsorship of a cycling team has many comparisons to the act of cycling itself. It’s an investment in time and energy as well as money, but moreover, it demands commitment and passion.
Something the bean counters at Comcast seem to be regrettably lacking.