Here's Why Formula 1 Only Races In The Richest Places On Earth

Image source: Mercedes AMG Petronas

Last weekend's Formula 1 Grand Prix was held in Bahrain, with Mercedes dominating an enthralling race. Away from the circuit, though, it may seem illogical to hold the race on the tiny Arabian island in the first place.

There are a number of larger countries, such as France, who do not host a race. So why is Bahrain, which is approximately half the size of London and with no motorsport history, such a prominent date on the Formula 1 calendar?

Image source: Red Bull/Getty Images

This interesting article on Forbes sheds light on the reasoning, and unsurprisingly it has a lot to do with the money-grabbing F1 business model. Unlike many sports, revenue from television, corporate hospitality and advertising goes solely to the F1 group - the circuits see next to nothing from these revenue streams.

In sports such as football, television revenue is split between the competing teams and represents a huge chunk of their income. They sell advertising banners within their stadiums and sell expensive seats to rich businessmen. F1 circuits don't get any piece of that particular pie.

Image source: Red Bull/Getty Images

At least they get the money from ticket sales, right? Yep, but the circuit must pay the F1 Group an annual hosting fee, which averaged about £16m ($27m) in 2011, so ticket sales are used to pay that. Oh, and these fees increase by about 10 per cent each year.

So governments must pump cash into the race for the prestige of holding such an event, which explains why eight of the 10 richest countries host races. And now you know why you can't afford a ticket to a race weekend. Bernie Ecclestone must be laughing his way to the bank.

You can read the full report on Forbes here.