America's Cup- Challenger discussions no push-over this time

by Richard Gladwell on 15 Jan 2014
Freed from the constraints of the so-called 'Dalton Amendment' which was controversially introduced mid-term into the Protocol for the 34th America's Cup, Emirates Team NZ's Grant Dalton was back to his usual blunt self at Tuesday's media conference.

Held to announce the signing of 49er World champions Peter Burling and Blair Tuke to Emirates Team New Zealand for the 35th America’s Cup, Dalton elaborated on the state of play, ahead of the announcement of the new Protocol expected in March.

'We're pleased with the way the Challenger of Record, is acting. They are acting like a Challenger of Record and not a puppet that we have dealt with for the last ten years,' he said.

Hamilton Island Yacht Club owned by the Oatley family interests were the surprise selection as the Challenger of Record, by the Defender Golden Gate Yacht Club, when many were expecting GGYC to re-sign their former Challenger of Record, the Royal Swedish Yacht Club, for the 35th America's Cup.

Hamilton Island YC, in turn appointed former America's Cup Regatta Director, Iain Murray, as the CEO for its challenge, known as Team Australia.

Murray had a sometimes tense relationship with Oracle Team USA CEO, Russell Coutts, and from all accounts it would seem that the discussions between the two groups have been rather sharp on key points. The underlying issue being that Murray had a very unique perspective on what happened in the 34th America's Cup.

The two teams, while backed by wealthy men are quite different, in that Team Australia is not expected to have the same budgets, or resources, as Oracle Team USA. They have also seen most of the Australians who made up the core of the USA-17 crew re-sign with the Defender, ahead of the Protocol being negotiated. Additionally the Oatleys, while new to the America's Cup game, are the owners of the highly successful supermaxi Wild Oats XI, and have campaigned that boat at the highest level for almost a decade. They are well in phase with the professional sailing world and its nuances - good and bad.

The key points under negotiation are not surprising – being the Boat (which Dalton indicated would be smaller).

Regattas (ACWS type) and the Rights associated with those regattas, with Dalton making it clear that if the Team did host an AC45 regatta, then they had to have the financial benefit of the TV and other Rights associated with the event. Otherwise it just becomes a cost to us,' he said indicating that the Challenging Teams would not be interested in working on that basis, and the regattas would revert to the hosted venue bidding, which saw the ACWS confined to locations in USA, Europe and one in UK.

Nationality is also obviously being discussed, with one recent poll of fans showing almost 80% were in favour of a tighter nationality requirement for the sailing crews.

'Certainly the talk has been about a Nationality Rule, and I think Russell (Coutts) wants a nationality rule – and we absolutely support a nationality rule,' he added.

Dalton says the Australian Challenger of Record, Hamilton Island Yacht Club, want real Cost Containment rules in the Protocol. 'The Aussies want cost containment, and we have been banging on about that for a long time.'

'We really just want to see how it all plays out.'

'A sailing team nationality rule will reduce cost, for sure. If there are a lot of one design components, the design team will reduce in numbers – we had 29 in our design team in the last Cup,' he remarks.

'If we are only allowed one boat, that also takes a big amount out of the cost of campaigning.'

Even so, Dalton says that he expects to still spend about the same amount on the next campaign as in the last.

'Russell is saying US $80 million to play – well that means $80 million to compete – doesn’t mean to win,’ he says with a slightly cynical grin. 'So you can take that $80 million as a minimum number to play the game.'

'We will spend more than that', he adds. 'I can't see our numbers coming down, at all, because will just open out in places where we were so restricted in budget. I think we will spend a similar amount to last time.'

In response to the point that it would seem that despite any cost restrictions, and for the past few Matches at least, the Defender has seemed spend whatever it takes to win. 'I think they will still do that,’ he replies. 'I don’t think that will change, but using a lot of one design components helps control that spend,’ he adds.

Use of one design parts while attractive on the surface, raises a number of issues about manufacture and measurement of one design parts, which manifested themselves in protracted Jury Hearings in the 34th America's Cup over three boats used in the America's Cup World Series.

Dalton says the team doesn’t have much option than to trust other teams not to indulge in the sort of boat tampering that occurred in the America’s Cup World Series with the supposedly one design AC45s, if one design parts introduced into the America’s Cup itself.

'I trust the measurer,' is his response, to the loaded question. 'I think that Nick Nicholson will be the Measurer again. I think the Jury did a really good job, although I know that Oracle doesn’t want to deal with ISAF. They are trying to break away from ISAF (the sports world body, which historically has had an interesting relationship with the America's Cup).

'I don’t know how that works,' he says shaking his head.

Dalton backs away from discussion of the minutiae of the Protocol negotiations. ‘The Aussies are dealing with Oracle,' he points out. ‘That is the job of the Challenger of Record. They are involving us, but we are really passengers, to a point. How the rules will eventually come out – we don’t know at this stage.'

'But so far, so good, it seems fine to me – and I’m the first to scream if I don’t think it is being done properly. It all seems good to me so far.'

By all accounts the level of communication between the Challenger of Record and the interested teams seems to be on a much better footing than previous editions. Dalton has been involved in only one of the teleconferences, with the main running being handled by COO, Kevin Shoebridge and skipper, Dean Barker.

One point of concern that Dalton does raise is whether there is the space for more than four teams on the Piers, where the Challengers are supposed to be located in San Francisco – meaning that there is only enough space for the four teams in the Semi-Final. 'That worries me a little bit, in terms of how it plays out,' he says.

The space limitation at the San Francisco venue is a serious issue for Challenging teams who need to be able to pitch the certainty of being at least able to sail in Qualification Rounds at the America's Cup venue, with its attendant media focus and exposure.

'I don’t know how many Challengers there will be', says Dalton. There are five or six at the moment that look real. But there is so much water to go under the bridge that I am just speculating.’

Dalton is not expecting the teams to start racing in the AC45’s until 2015, at which point the likely Challengers will start to shape up to some extent – particularly if they are required to buy and run their own boats. At this stage the format of any ACWS that may be held is uncertain. 'The sailors will have to run their own programs this year. We are looking at other options for Dean, and the other sailors. But this is a bit of a down-year. They're going to have to make their own fun.'

'There isn't any America's Cup stuff happening that I'm aware of - not at this point anyway,' he adds.

Also uncertain is whether the AC45’s will be converted to being foilers, although the issue has been discussed. ‘There is a cost associated with that conversion,’ he explains. 'But I think the Australians (and new teams) would be in favour of that, as they have to learn how to foil.'

Dalton’s understanding is that under the Protocol, to be issued, each of the Teams will have an Event, meaning that each Team will host an AC45 regatta. ‘Certainly we would promote there being an event in New Zealand. How you pay for it , or what Rights you have to on-sell is another issue. If it is an event with no Rights – then it is just a millstone around a Team’s neck. Where are you going to find the money?'

In the immediate future the team has more pressing issues, with 40 container loads of gear, plus four AC72 hulls, and cross-beams, arriving at a base - which is soon to be demolished.

The grand plan is for a new purpose-built base to house the team, on a new location in the Viaduct Harbour, with the new facility becoming a tourist focal point as well as being a functional working America's Cup team base. Discussions with the Auckland Council are continuing.