Apple Eyes Formula 1: A $2 Billion Streaming Gamble

Apple is pondering a venture into the realm of Formula 1, having already found success with Major League Soccer—particularly this year, thanks to the arrival of Lionel Messi. The tech behemoth is contemplating a $2 billion bid for the global streaming rights to F1. Should the bid succeed, Apple would become the exclusive rights holder for the sport, thereby displacing Liberty Media, the current commercial rights holder. Notably, the proposed figure is more than double what F1 currently garners from global television rights.

Apple's MLS Season Pass, which functions alongside an Apple TV+ subscription, has been well-received. This could likely serve as the blueprint for F1 if Apple secures the commercial rights. However, even if the deal comes to fruition, Apple won't immediately lay claim to the rights due to existing contractual obligations.

In the United States, for instance, ESPN holds the commercial rights until 2025. Apple CEO Tim Cook recently made an appearance at the US Grand Prix, where he waved the chequered flag. Furthermore, Apple is co-producing a film featuring Lewis Hamilton, with Brad Pitt in a leading role and Jerry Bruckheimer also on board.

Interestingly, a modified Mercedes F2 car is being utilised as the F1 car in the film. Additional garages were even erected in the pit lanes at the British and Hungarian Grands Prix for filming purposes.

Eddy Cue, Apple's services chief, is known to be a sports aficionado, much like Tim Cook. Cue is also a self professed car nut alongside Apple Fellow Phil Schiller who is part of Tim Cook’s executive team, meaning there could be a lot of support for the acquisition. Apple has also penetrated the athlete community with fitness-oriented products like the Apple Watch. Moreover, the company offers an MLB season pass and made a significant splash during the NFL season.

Apple's close relationship with Disney, which owns ESPN, could serve as an additional incentive. With the forthcoming Apple Vision Pro headset, content in virtual and augmented reality is also set to be significant. Amid Disney's financial woes, rumours are afoot that Apple might even acquire ESPN.

F1's popularity has soared, partly due to documentary series like "Drive to Survive" on Netflix. Liberty Media, which acquired the sport from Bernie Ecclestone in 2016, has witnessed a considerable uptick in its profile.

Thus, Apple's potential foray into F1 could be a watershed moment for the sport, the company, and the wider landscape of sports streaming.