Subject: [NEXTEL-1] Winston Cup garage worry that NASCAR might even have given away to Nextel rights that NASCAR doesn't have the right to barter

From: [email-masked]
Date: Wed, 25 Jun 2003 00:17:18 -0400

<SNIP>

Geoff Smith, the head of Roush Racing, says he is worried that NASCAR executives
gave away too much to Nextel, and that NASCAR's new sponsorship contract - given
the extreme volatility of both the electronics business and the technology - might
very soon be interpreted to preclude any computer makers, like Dell, Gateway, or
IBM, from becoming Winston Cup tour sponsors.

Some others in the Winston Cup garage worry that NASCAR might even have given away
to Nextel rights that NASCAR doesn't have the right to barter, creating a legal
minefield somewhere out there.
============================================================================================

Monday, June 23, 2003
MUDDLED: Can NASCAR protect Nextel's big bucks?

By Mike Mulhern
JOURNAL REPORTER

SONOMA, Calif.

AT& --T is such a big and visible part of the telecommunications establishment -
heck, this is the company built by the man who invented the telephone, the company
that made it ubiquitous - that it should be hard to forget or overlook.

But it appears that NASCAR officials, in their haste to wrap up negotiations with
Nextel, might not done as much due diligence as they should have in examining the
playing field.

And over the last 48 hours, NASCAR execs have tripped over AT& --T's familiar
blue-and-white globe, which wound up plastered all over Kenny Schrader's Dodge for
yesterday's Dodge/SaveMart 350. And Schrader and car owner Beth Ann Morgenthau may
wind up big winners in the AT& --T debate with NASCAR over the controversial issue
of sponsorship exclusivity.

Or the lawyers may call today and tell them to throw in the towel.

NASCAR's lawyers couldn't figure out quite what to do here Friday when the issue
first arose, but they'll be back at the books today, trying to sort out the legal
issues surrounding what could well be a multi-million-dollar debate.

NASCAR and Nextel don't want AT& --T Wireless on anybody's quarterpanel next
season, although both Dale Earnhardt Inc. and Jack Roush had been deeply involved
in negotiations for an AT& --T Wireless sponsorship. NASCAR officials here have
made clear they aren't happy with the AT& --T affair.

However there is some discontent in other corners of the Winston Cup garage, too.

Geoff Smith, the head of Roush Racing, says he is worried that NASCAR executives
gave away too much to Nextel, and that NASCAR's new sponsorship contract - given
the extreme volatility of both the electronics business and the technology - might
very soon be interpreted to preclude any computer makers, like Dell, Gateway, or
IBM, from becoming Winston Cup tour sponsors.

Some others in the Winston Cup garage worry that NASCAR might even have given away
to Nextel rights that NASCAR doesn't have the right to barter, creating a legal
minefield somewhere out there.

So AT& --T, even if its Wireless division is being shut out of NASCAR racing,
doesn't appear at all interested in fading out of the stock-car racing picture.
After all, it is listed on the side of the red-and-white trailer as one of the
official sponsors of NASCAR, though that line is expected to soon be scratched in
favor of Nextel.

If AT& --T can't directly advertise its Wireless branch on a NASCAR stocker, it
wants to go round the barn to put its name out there in much the same way that
Texaco used its Havoline oil brand to get the big red star on TV, even though
Unocal held exclusive rights to be the official gasoline of NASCAR.

In the middle of the potentially huge sponsorship rights battle is one of the
smallest teams on the tour. And, given the politics - sometimes quite heavy-handed
politics - that play out in this sport, it remains to be seen how vigorously the
Morgenthaus will play their unexpected hand, particularly since Schrader is a
driver who doesn't like to buck the establishment.

Gus Larkin, Morgenthau's business manager, has been trying to put together a major
sponsorship package all season. The team has been the only completely independent
operation on the Winston Cup tour, making a go of it with Morgenthau's own money
and some associate sponsorships.

Ironically, AT& --T has been one of those associates. AT& --T's Wireless division
has been shopping around for a Winston Cup team to brand with a primary
sponsorship, as Cingular and All-Tel have done. The Wireless division had been
close to doing a deal with Dale Earnhardt Inc. or with Jack Roush and Jeff Burton.

However, when NASCAR signed Nextel as the new series sponsor, the sanctioning body
included modified exclusivity in its contract: Cingular and All-Tel would be
allowed to keep sponsorships as long as they'd like (as long as they remain with
their current teams), but the three other U.S. cell phone companies could not come
in.

As tough as the economy is, and as wide-open as telecom marketing is, NASCAR teams
are not happy at suddenly being shut out of that lucrative sponsorship market.

'AT& --T has been a sponsor of ours from the get-go,' Larkin says. 'We put
together a limited schedule with them (at the start of the season). They have a
number of brands they're looking to promote within their program -- one of them
happens to be AT& --T, which comes from the corporate side. Wireless is a
completely separate business. They own Wireless. But the Call AT& --T brand, as
far as the globe and all that, has been around for years, even before Wireless was
in existence.

'Next week you'll see 1-800-Call AT& --T back on the car. And then you'll see this
brand (AT& --T itself) again coming back out. It's a relationship we've had all
year long. The timing may seem coincidental, but this has been in the plans the
whole time.

'Wireless is an entirely different program which has nothing to do with what we're
doing.

'We want to be sensitive to the Nextel deal. We've discussed it with NASCAR, and
they're investigating it as well. Everybody needs to be careful -- they're
involved in a very big deal, and we don't want to do anything to upset that. But
in the same respect, we have a sponsor, and we have an established relationship
with them, and we're trying to look out for their interests, too.

'I don't think this conflicts with Wireless or Nextel or anything at all. This is
a completely separate deal.

'Strategically, they (AT& --T) have plans for this program that have been in place
for a long time. They are sensitive as well to the situation going on here as
well. But they want to make sure their brands are out there, and they have some
strategies in place to help them do that, and we're here to help them do that.

'We're all working together to make sure Nextel is taken care of and their
interests are looked after.... and in the same respect that AT& --T is able to
brand a race car and have a presence here.

'AT& --T has been on the car. They have a full season's associate sponsorship with
us, and in that agreement they have the capability to brand the car as a primary.
That's always been an option for them. And they're using a number of brands.'

Smith, a lawyer by trade as well the contract negotiator for Roush Racing, says he
is bothered by the entire issue of exclusivity in this sport and NASCAR's attempts
to exclude some telecoms from the playing field:

'I am quite bothered by NASCAR's movement to exclusionary marketing rules. I think
by this time next year, All-Tel and Cingular and Nextel will all be achieving what
they expect to be achieving out of the sport, regardless of the presence of each
other on the same property. It's happened over and over in this sport: Valvoline
and Citgo, for example, and Texaco and Unocal, and Pepsi and Coke.

'There is just so much room. And I am a free enterprise guy. If you have
confidence in your products and services and strategy, then this is America, and
you ought to expect your competitors are going to be around you ... and you ought
to be able to handle that.

'There is room for honest disagreement on that particular point. It is such a huge
business category that is extremely volatile, with lots of marketing energy as
people try to compete against each other. So the teams have lost some of that
energy. But then we have gained the energy that comes from Nextel.

'The category exclusion is wired and wireless communication. Of course ,my concern
is that within two years that will include every computer manufacturer, because
voice transmissions are coming in so quickly every day in every kind of electronic
instrument we have.'

So what is being excluded 'is everything that floats through the air except your
voice and mine,' Smith says.

'The rule, as it has been explained to me, is that you can keep your relationship
at the existing level or you can keep your relationship if they want to reduce
their participation. But you can't escalate the participation. So if they
(Morgenthau) have an existing relationship for primary sponsorship, they'll be
allowed to continue that.'

So could Roush buy that team and take over the sponsorship?

It would appear that NASCAR has opened a can of worms.

'It is no more complicated than the rule book,' Smith said with a laugh. 'There is
that gray area. '

Smith, meanwhile, said he is still pursuing AT& --T Wireless for a Busch or Truck
sponsorship. 'When we last left it, which was Wednesday night, we were told there
would be no AT& --T Wireless as a sponsor in the Winston Cup garage. So AT& --T
said they would regroup and rethink things, and we gave them several options that
we thought we would work. AT& --T is not closed out of access to the NASCAR fan --
the question is how creative do they want to be, to be able to continue in this
sport.

'Most of my viewpoint of this is positive for what's going on - the quick
transition to a party that is going to be spending heavy advertising money to
promote the sport. That will be great for the teams.

'But what happened was, NASCAR made a decision that, to be able to sell this
property for the money they wanted, they had to yield these rights, on the
exclusionary side of things.'

------------------------ Yahoo! Groups Sponsor ---------------------~-->
Get A Free Psychic Reading! Your Online Answer To Life's Important Questions.
http://us.click.yahoo.com/Lj3uPC/Me7FAA/ySSFAA/61FxlB/TM
---------------------------------------------------------------------~->

Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/

---

From: sparkie_rf <[email-masked]>
Date: Wed, 25 Jun 2003 05:45:24 -0000

> minefield somewhere out there.

Bingo!!! This guy knows what he's talking about.

NASCAR blew it badly. They were overly concerned that they would 
have a hard time getting any deal down, that they made a deal to 
quickly.

Why did they give Nextel exclusive rights in both the wired and 
wireless categories?

Anybody remember "New Coke". I hereby christen the new NASCAR-NEXTEL 
deal the "New Coke" of sports sponsorship. This deal may not last 
very long at all. They should tear it up and start over.

Btw, Marcel not all my buddies bother to read the manual. Heck many 
people don't know that the keyboard works faster than the mouse on 
windows.

---

From: [email-masked]
Date: Wed, 25 Jun 2003 01:56:56 -0400

sparkie_rf wrote:

> Why did they give Nextel exclusive rights in both the wired and

Some thing is Fishy about this deal-

> very long at all. They should tear it up and start over.

Hahaha

> people don't know that the keyboard works faster than the mouse on

I know the feeling...... Nextel gave the staff at the club free phones, the Golf
Pro keeps "Direct Connecting" himself he can't figure out why he can't reach
anyone. He always ends up using a Land Line. It's funny as H***! We all act like
we don't see what he is doing. We told him to watch the video tape ........he
won't .......oh well!