America's cup - cutting the cost of competing

Emirates Team New Zealand in the final fleet race of the America's Cup World Series regatta in Naples 2012. Photo / Chris Cameron

America's Cup organisers are absolutely doing the right thing in introducing radical measures to cut down the costs of competing. It's the timing that stinks.

The decision yesterday to reduce the size of the boats for the next event in 2017, and thus carve out a significant chunk of team budgets should have been a straight forward one. But it wasn't. As with most America's Cup the process has been drawn out and tortuous. That's because for a lot of teams the concessions have come too late.

When America's Cup defenders Oracle released their Protocol for the next event in June last year - nine months after their successful defence in San Francisco - they claimed the new rules would drastically reduce the costs of competing and make the event more accessible for new start-up syndicates.

Team New Zealand were skeptical from the outset. Grant Dalton claimed the defender's measures to cut costs were ineffective and predicted he would need about much the same as the $120 million they "scraped by" on in the last campaign for the 2017 event.

He also raised concerns about the lengthy gap between having to fork out the US$1m to enter the event and organisers nominating the venue for the Cup match, pointing out it was impossible to secure funding without being able give potential sponsors crucial information like which markets their brands would be exposed to.

Other teams weren't happy about the new regatta schedule, with the introduction of the America's Cup qualifying series - a new layer of competition added to seed the teams ahead of the challenger series (and give Oracle the opportunity to test their boat against the challengers before the big show) - adding to the cost.

The original challenger of record - Team Australia - even pulled the pin over eight months ago citing spiralling costs. Still the ACEA did nothing.

Having signed on as challenger of record with hopes of making the Cup more affordable and sustainable, Team Australia principal Bob Oatley said upon the syndicate's withdrawal that they had failed in their mission.

"Ultimately our estimate of the costs of competing were well beyond our initial expectation and our ability to make the formula of our investment and other commercial support add up."

Even back then there were murmurings the French challenge led by Franck Cammas was struggling to get off the ground, while Ben Ainslie's self-titled syndicate was generating plenty of publicity but apparently little in the way of sponsorship.

And yet only now, nearly a year after the original Protocol was released, when several teams are well-advanced in their design plans for the AC62, America's Cup organisers have seen fit to introduce sweeping changes to the class rule and structure of the event.

The announcement was made with the predictable self-serving sentiments, congratulating themselves for making these visionary changes.

Oracle skipper Jimmy Spithill earnestly tells us "there is a bigger picture to consider". The same Jimmy Spithill who went on New Zealand television and accused Dalton of being whinger when he complained of the costs.

But while the ACEA's sudden turnaround is frustrating, Team NZ and Luna Rossa should just suck it up and get on with it. Yes, it would have been helpful if the ACEA had come to this realisation a year ago before time and money was wasted designing a boat that will never be built.

But it's still the right thing to do. Team NZ will have to be satisfied quietly dining out on the irony.

Right now, the team are more concerned with trying to reinstate Auckland as the venue for the America's Cup qualifiers.

It's not clear why the decision to move to smaller boats and ditch Auckland as the host of the qualifiers were mutually exclusive. Surely with the reduced costs and ease of shipping the smaller boats around would make it a more palatable proposition for the European challengers. But the majority of the teams have made it clear the preference is for all racing to be conducted in Bermuda.

Contrary to reports the loss of hosting rights will spell the end of Team NZ, the Kiwi syndicate's future does not rest on the outcome of the complaint.

Given the Government were only expected to contribute $5-10 million to Team NZ's next campaign - significantly less that then $36 million invested last time - the potential loss of that funding will be off-set by savings made by the reduction in boat size.