F1 signs deal with Microsoft

“The bad news is that it’ll still crash due to bad drivers.”

I was reading Channel 9′s forum and saw someone post that quote and thought it was funny.

So, what are we talking about? Microsoft just got a contract with Formula 1 to provide electronic control units.

I remember arguing with other employees about how important sponsoring racing is.

Racing drives HUGE sales around the world. NASCAR, for instance, can make or break a brand.

Plus, they throw cool parties at the sponsor tents where you can bring your best clients and hit them up for big contracts.
In other Microsoft news it is looking for more space. In Redmond they are working on several new buildings. Microsoft’s research division is building a new building. Kevin Schofield recently told me about how they are doing that. Architects are working with the employees to build the “ultimate” workspace.

What caught my ear? They have removable walls. If workers decide they need a different space layout they’ll be able to pull the walls down and move them around. Someone should go over and get video of that when the time comes.

Comments

  1. It’s Microsoft MES that the FIA have signed up, which is apparently a joint venture between Microsoft and Siemens.
    Siemens have plenty of ECU experience (for normal cars, but I think some racing too), and I think MS provide the analytical software for the pits.

  2. It’s Microsoft MES that the FIA have signed up, which is apparently a joint venture between Microsoft and Siemens.
    Siemens have plenty of ECU experience (for normal cars, but I think some racing too), and I think MS provide the analytical software for the pits.

  3. I hope MSFT got a little bit of money left to pay for the F1 “Ciruit de Francorchamps” as well while there at it :-) They can use it.

  4. Speaking of “Drivers Behaving Badly: Cancun 2006,” people don’t realize that many driver issues with Windows are the result of third-party developers doing heinous things at the low-level. This was especially true back when the graphics layer was in the kernel.

  5. I hope MSFT got a little bit of money left to pay for the F1 “Ciruit de Francorchamps” as well while there at it :-) They can use it.

  6. Speaking of “Drivers Behaving Badly: Cancun 2006,” people don’t realize that many driver issues with Windows are the result of third-party developers doing heinous things at the low-level. This was especially true back when the graphics layer was in the kernel.

  7. Yes, F1 is big business. I cringe a little at the comparison with NASCAR though. NASCAR is relatively popular, true, but not nearly as mainstream as basket ball or baseball. F1 on the other hand is the single most-watched sport on the planet but a fairly wide margin. It is significantly more popular than – say – football, or any other US sport for that nature. And unlike other big sporting events (like the super bowl or the soccer world cup), it is on every other weekend. It is a HUGE deal. Much beyond anything most Americans think it is. Being the single electronics provider is a gigantic deal for MS and has already gotten a lot of attention around the globe…

  8. Yes, F1 is big business. I cringe a little at the comparison with NASCAR though. NASCAR is relatively popular, true, but not nearly as mainstream as basket ball or baseball. F1 on the other hand is the single most-watched sport on the planet but a fairly wide margin. It is significantly more popular than – say – football, or any other US sport for that nature. And unlike other big sporting events (like the super bowl or the soccer world cup), it is on every other weekend. It is a HUGE deal. Much beyond anything most Americans think it is. Being the single electronics provider is a gigantic deal for MS and has already gotten a lot of attention around the globe…

  9. Scoble, I know this is probably something you didn’t think about before you wrote, but what data do you have that shows NASCAR can make or break a brand? And that race car sponsorships drive HUGE sales? When I look at IndyCar racing for example, I bet the general public has no clue who the companies are that are sponsoring the majority of those cars, let alone actually buy any of their products. Same goes for F1. How many people buy a Ferrari because they sponsor Schumacher? Some, but few I say. It does, however give Ferrari a lot of credibility as far as being a great car builder, though. Quick now! When was the last time you bought a Tosso Rosso product? Didn’t think so.

    Companies don’t sponsor race cars in the hopes that it will drive sales. Hell, if that was their hope then the person in charge of advertising for that company should be fired. The company’s advertising dollars are better spent on traditional advertising from a pure “drive sales” perspective. Not enough people see the rolling billboard on a car as would see an ad on TV, radio, newspaper. It’s the partnerships that are the attractive angle.

    I’m just curious of you can point us to the data that shows a direct correlation between racing sponsorships and sales. Or is this just your unsupported opinion? The reason I ask is that I don’t know of a reliable ROI method that definitively allows a company to track the success of their racing sponsorship dollars. Do you?

  10. Scoble, I know this is probably something you didn’t think about before you wrote, but what data do you have that shows NASCAR can make or break a brand? And that race car sponsorships drive HUGE sales? When I look at IndyCar racing for example, I bet the general public has no clue who the companies are that are sponsoring the majority of those cars, let alone actually buy any of their products. Same goes for F1. How many people buy a Ferrari because they sponsor Schumacher? Some, but few I say. It does, however give Ferrari a lot of credibility as far as being a great car builder, though. Quick now! When was the last time you bought a Tosso Rosso product? Didn’t think so.

    Companies don’t sponsor race cars in the hopes that it will drive sales. Hell, if that was their hope then the person in charge of advertising for that company should be fired. The company’s advertising dollars are better spent on traditional advertising from a pure “drive sales” perspective. Not enough people see the rolling billboard on a car as would see an ad on TV, radio, newspaper. It’s the partnerships that are the attractive angle.

    I’m just curious of you can point us to the data that shows a direct correlation between racing sponsorships and sales. Or is this just your unsupported opinion? The reason I ask is that I don’t know of a reliable ROI method that definitively allows a company to track the success of their racing sponsorship dollars. Do you?

  11. Markus – sorry, by any meaningful measure (dollars per race, butts in seats), NASCAR dwarfs F1. The smallest NASCAR race (in terms of butts in seats at the venue) is larger than the largest F1 race. Every year. F1 viewership is dwindling while NASCAR grows.

    You’re welcome to enjoy F1 – I don’t watch either F1 or NASCAR – but to say NASCAR isn’t mainstream is laughable.

  12. Markus – sorry, by any meaningful measure (dollars per race, butts in seats), NASCAR dwarfs F1. The smallest NASCAR race (in terms of butts in seats at the venue) is larger than the largest F1 race. Every year. F1 viewership is dwindling while NASCAR grows.

    You’re welcome to enjoy F1 – I don’t watch either F1 or NASCAR – but to say NASCAR isn’t mainstream is laughable.

  13. F1, I went to my 1st GP 2 weeks ago, I enjoyed it, but stopped following it a few years ago when Schumie kept winning all the time.

  14. F1, I went to my 1st GP 2 weeks ago, I enjoyed it, but stopped following it a few years ago when Schumie kept winning all the time.

  15. In terms of butts in seats then NASCAR probably beats F1. It’s simply easier to house more people around a speedway than a road course. But in terms of TV viewers F1 is miles ahead everywhere but in the US. NASCAR gets practically zero exposure outside the US.

    Bought a can of Red Bull recently? Then you bought the Torro Rosso product.

  16. In terms of butts in seats then NASCAR probably beats F1. It’s simply easier to house more people around a speedway than a road course. But in terms of TV viewers F1 is miles ahead everywhere but in the US. NASCAR gets practically zero exposure outside the US.

    Bought a can of Red Bull recently? Then you bought the Torro Rosso product.

  17. Wow. Of all my time on Scoble’s blog, this is the first thing I can actually say something intelligent about.

    NASCAR is big, but only in the US. TV audience is slightly smaller than NFL. Attendance at each race is huge. NASCAR sponsorship moves stuff. A friend at Office Depot HQ told me that their marketing surveys showed that 45% of the people surveyed said that they would shop at OD BECAUSE of thier sponsorship. It is a marketing powerhouse.

    F1, on the other hand, dwarfs NASCAR in viewership and world influence. F1 is watched by more people on TV than any other sporting event in the world, except for the world cup. Audience for each race is in the billions. The Japanese are crazy for F1. I was in a beachside bar in Malaysia a few years back on a Sunday afternoon, and the results of Euro soccer matches and that day’s F1 race were posted on a chalk board.

    Mercedes, Renault, BMW, Toyota and Honda have all gone from suppliers to the sport to team owners over the past years because of the halo effect it has on their brands.

    This is a big deal.

    Anyway, Robert, can you hook me up with someone on the team at MS who will get me a place in the pits at Monaco next year?

  18. Wow. Of all my time on Scoble’s blog, this is the first thing I can actually say something intelligent about.

    NASCAR is big, but only in the US. TV audience is slightly smaller than NFL. Attendance at each race is huge. NASCAR sponsorship moves stuff. A friend at Office Depot HQ told me that their marketing surveys showed that 45% of the people surveyed said that they would shop at OD BECAUSE of thier sponsorship. It is a marketing powerhouse.

    F1, on the other hand, dwarfs NASCAR in viewership and world influence. F1 is watched by more people on TV than any other sporting event in the world, except for the world cup. Audience for each race is in the billions. The Japanese are crazy for F1. I was in a beachside bar in Malaysia a few years back on a Sunday afternoon, and the results of Euro soccer matches and that day’s F1 race were posted on a chalk board.

    Mercedes, Renault, BMW, Toyota and Honda have all gone from suppliers to the sport to team owners over the past years because of the halo effect it has on their brands.

    This is a big deal.

    Anyway, Robert, can you hook me up with someone on the team at MS who will get me a place in the pits at Monaco next year?

  19. Sorry dmad, I think you may be out of your field of experience commenting on this story. It doesn;t seem like you have much racing knowledge. Here’s what I mean…

    You link Ferrari like it’s the main sponsor of Schumi or Massa, when Marlboro is! Ferrari is simply the constructor (though admittedly the constructor wants to move their product through that role). It’s the same linkage Chevrolet has to Earnhardt Junior or J. Gordon: they are the car manufacturer not the main sponsor. Would you say Chevy is the main association to those drivers or is it Bud and DuPont?

    Torro Rosso on the other hand is a bit different. They are the constructor AND the sponsor via Red Bull (Torro Rosso = Red Bull, which you probably should know before asking if anyone ever had bought a Torro Rosso product, LOL). But that’s what Red Bull GmbH has decided to do as a company involved in sports: buy the team/organization/series and attach the Red Bull name to it. When Red Bull gets into NASCAR full time next year, they will only be the title sponsor of a Toyota versus the manufacturer because of the different sanctioning body rules.

    I really disagree with your second paragraph! I don’t think you can say that a company should *never* spend on racing and dump it all into “traditional” adverts more than you can say the reverse is true. I think that they work in concert. After all, I am a big NASCAR fan and know many, many, many fans who ONLY buy products that their driver is sponsored by: Chevys, Budweiser, Wrangler jeans, and Ritz crackers. Fanatical? Yes. But pretty common among the millions and millions of fans.

    I’m going to strongly bet that companies do have data to support funneling their dollars into racing. My company doesn’t do it, so I can’t say what that mechanism it is, but I would doubt that Fortune 500 companies would put multi-millions into something that they didn’t make money on! It’s just standard business sense. Heck, Red Bull GmbH is in segemtns of motorsports all over the world, so I would assume that they are making some RoI decisions, wouldn’t you?

  20. Sorry dmad, I think you may be out of your field of experience commenting on this story. It doesn;t seem like you have much racing knowledge. Here’s what I mean…

    You link Ferrari like it’s the main sponsor of Schumi or Massa, when Marlboro is! Ferrari is simply the constructor (though admittedly the constructor wants to move their product through that role). It’s the same linkage Chevrolet has to Earnhardt Junior or J. Gordon: they are the car manufacturer not the main sponsor. Would you say Chevy is the main association to those drivers or is it Bud and DuPont?

    Torro Rosso on the other hand is a bit different. They are the constructor AND the sponsor via Red Bull (Torro Rosso = Red Bull, which you probably should know before asking if anyone ever had bought a Torro Rosso product, LOL). But that’s what Red Bull GmbH has decided to do as a company involved in sports: buy the team/organization/series and attach the Red Bull name to it. When Red Bull gets into NASCAR full time next year, they will only be the title sponsor of a Toyota versus the manufacturer because of the different sanctioning body rules.

    I really disagree with your second paragraph! I don’t think you can say that a company should *never* spend on racing and dump it all into “traditional” adverts more than you can say the reverse is true. I think that they work in concert. After all, I am a big NASCAR fan and know many, many, many fans who ONLY buy products that their driver is sponsored by: Chevys, Budweiser, Wrangler jeans, and Ritz crackers. Fanatical? Yes. But pretty common among the millions and millions of fans.

    I’m going to strongly bet that companies do have data to support funneling their dollars into racing. My company doesn’t do it, so I can’t say what that mechanism it is, but I would doubt that Fortune 500 companies would put multi-millions into something that they didn’t make money on! It’s just standard business sense. Heck, Red Bull GmbH is in segemtns of motorsports all over the world, so I would assume that they are making some RoI decisions, wouldn’t you?