You’ve really got to hand it to Oracle (ORCL) founder, multibillionaire, and sailor Larry Ellison: By letting his monopolistic impulses loose on his favorite sport, he’s well on his way to defending his own 2010 America’s Cup victory by driving all other prospective competitors out of business.
As highlighted in a June 4 New York Times article, the usual field of sailboat teams entering the America’s Cup has narrowed from about 15 to just four, with three months to go before the regatta officially begins on Sept. 7. One of those four teams, Artemis, has yet to confirm whether it will enter the race, following a tragic accident on May 9, in which a boat cracked up and a member of its crew, British Olympian Andrew Simpson, drowned. Meanwhile, the city of San Francisco, which went all out to help Ellison create a stunning venue on the city’s waterfront, now finds itself on the hook for expenses that a dozen or more race teams, their boathouse crews, and their fans were expected to help offset. Ellison, perhaps confusing contenders for the America’s Cup for cloud computing startups, has effectively bid every team up to a $100 million commitment most can ill afford.
Is it fair to lay this all on Ellison? Well, yeah. As the winner of the last America’s Cup, he won the right to choose the next venue and set the rules for the regatta.
San Francisco makes for an ideal setting, not just because of its proximity to Oracle’s Redwood City (Calif.) headquarters. The Bay is windy; sailboats need wind. Thanks to the removal of the Embarcadero Freeway, the city’s waterfront is vibrant again. And the super-fast multi-hulled boats Ellison championed seem to improve the Cup’s appeal as a televised event. The trouble is that when it came to building those boats, Ellison couldn’t resist trying to out-innovate the field—to the point where there will soon be no field.
Mind you, lots of sailors, not just Ellison, are thrilled by the ultrafast vessels and welcomed the reimagination of the sport’s most visible regatta. Fans crowded a series of nine test events held around the world using 45-foot catamarans, called the America’s Cup World Series. Yet many teams had trouble stepping up to the 72-foot boats. The Italian Mascalzone Latino team, the original challenger of record, dropped out in December 2011, citing costs. Keith Mills, one of the organizers of the London Olympics, recruited Ben Ainslie, the most successful sailor in Olympic history, to compete in the Cup. But Mills abandoned his plans in 2011, telling the Telegraph the boats “frightened the life out of me.”
“I think they really hit the nail on the head with the 45s,” says Randy Smyth, a two-time Olympic silver medalist in catamarans who won the Cup in a 60-foot catamaran in 1988. “That’s a very exciting televised sport. But to me the 72s are sort of like racing 747s. Bigger isn’t always better when you’re trying to make a sport.”
Perhaps it’s not too late for Ellison to reconsider a pivot to the 45-foot boats that Smyth believes can deliver all the excitement needed to grow the sport, minus the peril and expense. At Oracle, Ellison has shown the capacity to adapt: While he took heat as a cloud computing “denier,” he was also an early investor in the category before moving Oracle “100%” to the cloud in 2012.
Maybe this time, too, he’ll realize a better technology is at hand. For now, though, it appears he’s sabotaging his own party. Unless he wants to win without a contest—in which case, he’s genius.
