Big events or hot air?

Andrew Whittaker provides an update on Melbourne’s second thoughts on the benefits of major events. Despite all the hyperbole of the grand prix and the FIFA World Cup, do the comedy and garden festivals actually offer better value for money?

Flower power: a more profitable alternative to Formula One?

It has been an extraordinary summer over here with cyclones, torrential rain and flooding. We also lost the Ashes and a World Cup bid. This took a bit of getting over although, in hindsight and with a much calmer reflection, it was probably a good thing to lose the World Cup bid because dealing with FIFA and its dodgy set up would have been one-sided and expensive.

In fact there has been some very good discussion and analysis about the value of some of these so-called big events to a city. The lord mayor of Melbourne questioned the value and purpose of the F1 grand prix to Melbourne as it runs at a significant loss (last year it lost A$47 million) and this loss has increased every year. It is a race on public roads and a community asset (Albert Park) has to be closed for weeks each year while they build the track infrastructure and then take it down to store it for the next year. It is significant that the economic supporters of grands prix have changed their words and now talk about the ‘economic impact’ of the race not the ‘economic benefit’. It is questionable whether there is any benefit and there is certainly a growing discontent with the cost of the race. As usual Bernie Ecclestone is dismissive and says he can easily take the race elsewhere where he gets more money and better broadcasting times.

The main argument is that we get worldwide exposure of the Melbourne brand name, although I doubt if anyone sees the name ‘Melbourne’ during the race and says, “I will go there for a holiday.” There are much better and more subtle reasons why people come to Melbourne. In fact the International Comedy Festival, International Flower and Garden Festival and other cultural events probably bring in more people and cost less to put on.

After seeing and experiencing the machinations, voting processes and politics of FIFA, a similar feeling of unease was detected in the public debate about the World Cup and how much it would have really cost and whether we were better off without it. You can get blinded by the hype and glamour of the event but the only real winners would have been FIFA.

Last year I wrote about a new 30,000 seat stadium being built in Melbourne with multiple tenants. It has been named AAMI Stadium after the sponsor AAMI, an insurance company (see It has been completed and is in its first year of operation with games being played throughout the year for the different football codes. It is the home for Melbourne Victory (A League football), Melbourne Storm (rugby league), Melbourne Rebels (Super 15 rugby). Melbourne Heart (A League) also play there and Melbourne Aussie Rules have their administration and training base there. It has a highly efficient and sophisticated management model and the different tenants share facilities within the stadium. It seems to be working very well and there is something to go to virtually every week. The different football clubs do not seem to be in conflict and are working together to make sure the stadium is successful. I am certain there is a significant crossover between fans as many are sports lovers and will go to watch good professional sport whatever football code is being played. I think it could be a model for future stadiums in Australia.


Andrew Whittaker is The Leisure Review's southern hemisphere correspondent


The Leisure Review, April 2011

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“It is significant that the economic supporters of grands prix have changed their words and now talk about the ‘economic impact’ of the race not the ‘economic benefit’.”

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