Immediately after the announcement that Netflix would start supporting ads by the end of 2022, speculation quickly shifted to how long before the streaming giant would jump into the live sports pool.

As we’ve previously discussed here, live sports are probably a better long-term goal than a short-term fix for Netflix given the challenges it faces just to get coverage of those sorts of events operational. After all, being a live TV service requires some different infrastructure than on-demand does, nevermind the fact that Netflix’s ad business still needs to get off the ground. Those issues are potentially rectified by a pivot back to quality over quantity of content (supposedly in progress already), which in turn might free up money to pursue things like a bid for Formula 1 racing TV rights.

Originally reported by Business Insider, Netflix is up against Amazon, NBCU and current rights holder Disney (ESPN) to be the U.S. home of F1 races for for 2023 and some indeterminate year beyond that. The asking price appears to be around $100 million per year. For reference, Netflix spent $17 billion on content in fiscal year 2021 alone.

On one hand, it’s easy to see how Netflix gets this done. If you trim the content budget by even just 1% per year, that’s $170 million available — potentially enough to both pay for the rights and the infrastructure changes, as well as the talent. If Netflix is truly adjusting its content strategy away from just MORE, you could see a that’s a lot larger than 1%, which increases its abilities to make all of the necessary changes to successfully air live races.

On the other hand, these negotiations come at a tough time for Netflix. Wall Street is souring on streaming overall. Netflix is working to implement advertising for the first time. And the company currently has no live sports capabilities. That’s a lot of balls already in the air that combined would be a challenge for any company. And that’s before even accounting for the new rumor (reported by Business Insider) that Netflix could be looking to acquire Roku…

Without diving into the Roku of all of this — itself another article entirely — Netflix is a natural fit for F1 if you assume it can figure out the live streaming infrastructure, talent and ad sales. Both the service and its audience are already plenty familiar with the sport given the success of Formula 1: Drive To Survive (itself part of the increasing interest in F1 in the U.S.).

But are they too familiar? If the goal for Netflix is expanding its subscriber base over the perceived cache of airing live sports, you have to wonder how much F1 actually accomplishes that. Diehard F1 fans were likely watching Drive to Survive as it is, so they were already paying Netflix. More than growth, F1 becomes a retention play at a price that’s probably worth it when (again) just swapping series budgets for these rights.

Regarding retention, the success of Drive to Survive also means fans are already used to going to Netflix for coverage of the sport. That makes it easier to introduce additional avenues of content beyond the show and live races, too. However, it also means Netflix would be investing even further into new areas for them — including a potential daily or weekly studio show, other behind-the-scenes content plays and more. Hosting live sports also means increasing TV advertising budgets to tell linear and non-Netflix streaming audiences where they can watch F1. Netflix has typically trailed streaming competitors in terms of TV ad presence (iSpot data indicates it’s No. 25 by TV ad impressions among streaming services in 2022 so far). That would have to change pretty abruptly for F1 to succeed.

So again, are live sports the best life raft for Netflix?

I’d still argue no, though not as loudly as before now that we know ads are coming. Jumping into F1 rights now seems like putting the cart before the horse given the other changes the business needs. But a few years down the road, when we get a better sense of what a “new” Netflix looks like? Sure, have at it.