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March 9, 2011

Brian France

KERRY THARP: Good afternoon, everyone. We appreciate you joining our special NASCAR teleconference today, featuring NASCAR chief executive officer and chairman Brian France.
Brian, at this time I'm turn the floor over to you for some opening comments.
BRIAN FRANCE: Thanks, Kerry. Good afternoon, everyone. We're just having on our off week here a little bit of a discussion about the start of the year, some of the things that are going on, some progress reports in a few areas. I'm going to reserve most of the time to take as many questions as we can.
But obviously in general with a very dynamic Daytona 500, having a really young star born, having the iconic 21 Wood Brothers team in Victory Lane, with 74 lead changes, very interesting way the competition played out during the Daytona 500. We started there and then on to Phoenix, getting Jeff Gordon back in Victory Lane, record lead changes again there, attendance up across the board.
Obviously, the competition has never been better. That's been brewing in terms of going in the right direction for a number of months, dating back well into last year where, as you know, we made a number of changes in the new car, which is not a new car anymore, but to get the car racing as good as we possibly can.
There's still some challenges for us and for many, many sports, many companies with still an uncertain outlook for the economy. As we said all along, we're not economists, we're not building around a doom-and-gloom, robust economy, we're doing what we think we need to do in general terms.
Obviously fuel prices are never helpful to our fans or anybody who needs to drive to an event, or anywhere. So those things are always out there.
The last thing that I would mention above competition that I think is important, we said during the last couple years that when the economy does what it does, you have some challenges, that's the time to look around and look deep at some of the areas for the future that you think you might be able to improve on.
Those reviews range, as you know, from the communications review, which brought us our IMC structure, Brett Jewkes, a number of new hires that are coming, has obviously been completed and we're implementing that on behalf of the industry and ourselves.
Then everything that would range from digital media, how effective are we in that new medium, range from the fans' experience at track, away from the track, trying to really get connected to our future in some meaningful ways.
Those reviews - I've sat through them all - are going very well. They're going to give us good ways to make sure this sport keeps on getting bigger, better and grows in the future.
With that I'll turn it over to questions.
KERRY THARP: Thank you, Brian. We'll open it up now to questions for Brian France.

Q. Brian, I wanted to ask you in regards to the TV ratings, different people said different things about them, I know there were challenges last year from going against the Winter Olympics, the Daytona pothole, the Vegas race. I wanted to ask you, shouldn't the ratings have been up this much anyway based off of not having that competition? People in the industry talk about the long-term broader picture. While the numbers are up from last year, they're down from 2009. How do you view that?
BRIAN FRANCE: I've always sed ratings are a function of many things: the competition, how you're viewed at the time by the fan base in a given moment, how the actual race is playing out. There's all kinds of things that go into it.
No one around here is celebrating. We're obviously pleased we're up dramatically in our ratings. But we know that is an ebb-and-flow thing. We're focused on a lot of things that will give us growth down the road. We're going to work on those, not get too excited or too down.
I look at the interest level of the sport, and that's growing after having peaked and maybe dropped back a little bit for some reasons a couple years ago. The general interest level is going up and that's what we're going to be working on, is creating new fans.

Q. You have the races where you grow ratings and attendance, then you have the off week. Can you detail the reasons why you have this off week so early in the season? Are you going to change that for next year?
BRIAN FRANCE: Well, it's historically how many events in the calendar we want to run, regardless when they ran. Historically it has been around this time where we do have an off weekend.
Arguably you would like to have that come down eight or ten races later. But that's just how the schedule and the climate issues that we face with certain markets and everything else has played out.
The reason for changing it is mostly driven that the other sports calendars are going to change on us - not just the NFL, but maybe some other things. So we're trying to get into the right date.
It also does accomplish, when we change next year, moving back the 500 a week, we'll eliminate the early schedule gap here. That will probably be a good thing.

Q. Brian, a lot of feedback that we in the media get from fans is about the post-race show or the lack of a post-race show. There seems to be a sense of frustration that fans invest so many hours into an event, then they get under 10 minutes of reaction after from the drivers that they've been watching. Is that something that NASCAR is hearing from your fan council? Do you have any input with FOX to try to solve this dilemma fans are faced with?
BRIAN FRANCE: We do have a fair amount of programming that happens with the SPEED Channel throughout the post race, even into the evening typically.
But, yeah, I think generally speaking we would agree, that it would be nicer to have a longer post-race. But if you think about it, most sports don't have a particularly long post end of a game, whatever else. The networks don't stick around for an additional half hour. It's not something FOX should be thinking about because, after all, that's just not the norm with network or even cable television.
Once the game is over, there's typically a short post-race. You hope the rest of it, social media, NASCAR online, places to digest good post-race information is where they go.

Q. Several of the manufacturers have talked about the next generation of car being redesigned for 2013. Can you bring us up to speed on how that project is coming along?
BRIAN FRANCE: Going well. Obviously lots of dialogue with the car manufacturers. We're addressing those needs, which is the need to keep the competition and safety and all that stuff where it is today, which is at a very high level. At the same time, evolving the car to give them even more identity with their manufacture make.
There's a way to do both. It kind of coincides with some of their new model launches and some things. So we're working pretty closely, as you can imagine.
It's going well. That's the beauty of the R&D center today. We can do multiple tasking with big, big initiatives, and do them hopefully all fairly well.

Q. What do you see as the biggest impact on television ratings? Sponsorship revenues you and the tracks can earn or now are they becoming more critical on the rights fees as you start negotiating in the next couple years?
BRIAN FRANCE: We spend a lot of time looking at obviously traditional broadcast television. Our cable partners are critically important. We spent a lot of time recently looking at the other media, which is social and digital media, where that's all going, where people are getting information, content and everything else.
We have a plan. We have a robust plan in the long run. We'll try to capture both. But one of the ratings impact is people are getting their news, updates, their fix, if you will, in lots of different ways today. We're going to want to, as a sport, make sure that we're taking advantage of all of them.

Q. Brian, can you address the ethanol situation and what challenges have you faced with the implementation to the new fuel in the three top series?
BRIAN FRANCE: Well, the fact that we haven't had a discussion is evidentiary proof of how well it's working. We couldn't be happier with it. From the early testing, we got good performance numbers. The teams certainly think it's working well. It obviously takes us another step. Especially now that you see energy prices going where they're going, it takes us a way down the road with a real biofuel that we're using in the car. They've just been a really good partner so far and it's going well.

Q. Will the elimination of the open week early continue after next season? Will the Daytona 500 still be moved up in years past this? Can you tell me the thought process why there always seems to be an open week early.
BRIAN FRANCE: As I said, it comes from the fact that we want to have 36 events, plus the All-Star Race, all that stuff. It's just a logistical matter where you can place events, February, March, in some parts of the country. There was an open weekend even though it might not be ideal. We're going to move that. It's going to fix that, although it wasn't the main driving reason.
In my view, all things being equal, we'd probably like to be racing this weekend. But I don't believe that to be a significant challenge for us because we happen to have an open week. We have a long season, we're going to have some open weeks.
In the long run, with the 500 moving, it will by definition take care of that. Our schedules are year-to-year, but you typically can see we have a lot of continuity.

Q. I asked you earlier in the year of the potential of an NFL lockout. How do you think NASCAR is now positioned should that happen? Why do you think we're seeing the growth in the younger demos so soon?
BRIAN FRANCE: First of all, my hope is that they will figure that out. I am not close to that any more than anyone else is. We're wishing that all of the leagues do well. That is just the reality of how we look at that. We don't pay any attention to where they are, where they're not. It's obviously out of our control.
The younger demo is the bigger question. That's good. I think having a young winner, and Jeff Gordon runs up our young fan base, and then Junior, arguably he's competitive more than he was a year ago. Probably a lot of reasons. I think the kind of racing we had, just to get off to kind of a good start.
But the young demo is something we're going to keep working at. It goes to candidly reaching new young fans. This is not a one-dimensional effort here just to get people to tune in on television. It's to get young fans really interested for the long run in every aspect of enjoying NASCAR the way we want them to enjoy NASCAR.

Q. I'm intrigued by the schedule-making process. This year you added testing to Daytona. You can actually point to that as a catalyst for a big Speedweeks to where we are now. What is the process that you go through as you look at the 2012 schedule right now?
BRIAN FRANCE: Well, you look at historical dates obviously. We have been a sport that's tried to build continuity around that. A lot of other motorsports, that's not necessarily so important. With us, it is. Then you look at the broader sports calendar, the notable big events that we're always looking at: the Masters, obviously the Super Bowl, other major events throughout the year that you want to make sure that you're putting your events in the right place as to get everybody the most room to be successful that you can.
It's all those factors. And the last point would be we have some limits as to moving dates around beyond even the continuity of events, which we've changed when we've had to. There are seasonality issues. You can't run a race in Phoenix, Arizona, in July. You're not running Cincinnati in February. On and on it goes. There's a lot of things that have to go into making up the ideal schedule.

Q. We know you've been a big supporter of the diversity program. Where does that stand now? Has it taken a little longer to get minority drivers into the top three series?
BRIAN FRANCE: I really didn't have a timeline. After all, there are limited seats available in the first place. But I will say that when we've had to change the program to maximize it, we've ended up partnering up with Revolution Racing, which has given some of these talented, diverse drivers a better opportunity to show their skills. It's not just giving them the opportunity, it's giving them the right opportunity.
I will tell you Darrell Wallace is a young African American driver that's winning. He's doing that now. We're going to have a breakthrough in that area. It's going to be on my watch, and I'll be very proud of that when that occurs.

Q. A couple of the drivers after recent races have expressed a level of concern about the level of rough driving going on out there these days, especially at places that don't normally feature that. Do you share their concern or do you think it's normal racing?
BRIAN FRANCE: No, I don't share that concern at all. They're the best guys in the world. We've said, You have to mix it up, this is a contact sport. We feel really good about that.
It's made the racing better. They've got to figure that out. They're doing that largely. I would say, too, with the wild card situation, where the last two spots are going to be decided by wins, if you don't happen to have the perfect top-10 performance in the first 26 events, I think you saw the disappointment with Tony not winning when he thought he should have won last weekend, he now counts that because he doesn't start fast. He may need that.
I think you're going to see an escalation of that. That's what great competition is. I'm actually happy to hear people complaining about that. It means it's working.

Q. Daytona obviously saw kind of a different style of racing than in the past. What did you think of that? Do you like that better or worse than the 30-car packs that we'd seen before?
BRIAN FRANCE: To tell you the truth, we were curious, too. It was a phenomenon. We'd never seen anything like that. We were curious going into Sunday. I remember talking to Mike in the tower. We didn't know how that was going to play out.
But 74 lead changes, dramatic racing all the way through, although it looked a little bit different, the competition level went up. We look at a lot of things to come to that, but we like it. It's different. But, generally speaking, if competition goes up, the races are exciting, we're going to like it.

Q. What do you think was the single most important factor in getting the buzz and the ratings up? Was it Trevor winning? Was it Jeff Gordon, Danica?
BRIAN FRANCE: You know, I don't know. We can't monitor things and measure things that closely. We went out in a strong way, as you know, in 2010 down to the last laps. We hadn't had that in a few years. You want to go out strong. It's really important to have a good playoff, a good finale. You see where that's helped the Super Bowls of late, which have been very competitive. So have some other series, other sports. You want to go out on a real high. We have a very short window to launch. If you're going out a little bit down, a little harder to ramp up.
So it's probably all those things.

Q. Are there any things that are worth pointing out innovative that NASCAR is going to do like what they're doing this weekend in the 1:00 special that will showcase on an off weekend a culmination of tape that hadn't been seen before? Are there other things like that coming up?
BRIAN FRANCE: You know, the programming schedule, it's pretty set. There will be a couple special shows that you'll see. One will be on the ethanol and the biofuel transformation we're working on. By and large, we'll zero in on the events. FOX, they're off to a very fast start. We'll be working with Turner for the mid-summer package, and ultimately ESPN and ABC as we conclude to make sure that they're getting everything they need from us and we're getting everything we need from them.

Q. Regarding the schedule, do you see any changes?
BRIAN FRANCE: Do we see any major changes in the schedule? We don't release that for another month or so. We did have a fair amount of changes last year and even some in the last couple years.
So by definition I don't think you're going to see a lot of changes. We'll see how some of the new dates, their new time on the calendar works out. But I don't think there will be as much as there was, say, in 2010.
We don't want there to be. We prefer to have a good continuity. That's our preference.

Q. What do you think of Danica's run last week, historically what that did, the highest finish by a female in any NASCAR national series?
BRIAN FRANCE: I think that elevated her. There was some discussion, did she have the right stuff to compete in the Nationwide Series. You know, I think she dispelled a lot of that. There's always circumstances in the start of a new career. But sometimes things are out of your control, people can crash in front of you, a hundred other things.
I think she elevated herself quite nicely. That's nice to see. She's a very competitive person. She's always said she's here to compete, not just happy to be here. That fits my criteria.
KERRY THARP: Brian, thank you very much. We appreciate everyone's participation today on the teleconference. We'll see you at the racetrack real soon.
BRIAN FRANCE: Thank you all.

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