Ships Of Fools

For sheer fun, it's hard to top the spectacle of billionaires behaving badly in the America's Cup qualifying now under way in New Zealand

By Richard Hoffer

Issue date: December 9, 2002

The boats, if these computer-sculpted splinters can be called watercraft at all, are utterly charmless. Hoisted out of the water at the end of the racing day and just before they're shrouded in secretive skirts, they are revealed as mostly mast and keel, the carbon-fiber hulls functional only to the extent that they can carry 17 crew members and remain seaworthy. The monstrous bulb below the waterline accounts for 80% of the boat's weight, counterbalancing the acreage of high-performance sails high above. No amount of iridescent epoxy in between can camouflage the ugliness of its desperation: Gotta go fast.

This New Zealand spring, as the boats are towed each morning out into Auckland's Hauraki Gulf (yes, towed; instruments this finely tuned for speed shouldn't have to commute), the desperation is reaching an old but still comic level. As it was 151 years ago, when some ex-colonists stormed England with a plan to sandbag its sailors in high-stakes racing, the America's Cup is home to a wealthy rabble of rampant egos who enjoy an attention-grabbing tussle. Chartered as a "friendly competition among nations," the event has once again collapsed into aristocratic rivalry, all the more entertaining for its nakedness of ambition and level of skulduggery.

Last week six of the original nine syndicates were still vying for the chance to challenge New Zealand, the reigning Cup holder, in February, and by week's end that total was down to four. (Though who will get the fourth spot still awaits a hearing to assess the protest lodged by Team Dennis Conner against the OneWorld syndicate, but more on that later.) The qualifying, called the Louis Vuitton Cup, is unduly complicated, its saving grace that it has reintroduced the word repechage to the sporting vocabulary. (Look it up yourself.) All you need to know for the moment is that of the nine challengers, there seem to be as many working definitions of clinical megalomania on the water as there are boats.

The ridiculousness is multinational. (Why would France enter its HAZMAT-colored Le Defi Areva, with full-on nuclear-power sponsorship, in nuclear-free New Zealand? So it could get rammed by a boatful of Greenpeace activists? Which it was. Well done!) The boat, oddly wind-powered, was mercifully eliminated two weeks ago anyway, but nobody does tycoons-in-TopSiders better than the Americans. With the residue of the new economy still seeding vanity projects, the Americans had a delightful flotilla -- three separate campaigns, all cheerfully eccentric in the best American tradition.

What else could this be, anyway, but a stab at nouveau nobility? Yachting has never been a sport for the masses, but now it's become the last refuge for our techno-royals. Some campaigns cost upward of $80 million, and while there is sponsorship galore (the boats are now dolled up like floating NASCAR shillery), most of that has to be ponied up by moguls.

And what fun that provides for the rest of us. Larry Ellison, whose Oracle wealth has fueled an enormously entertaining bravado ("Whatever I want, I get," he once said. "That's the beauty of being worth $26 billion. I thoroughly recommend it"), chugs around Auckland's harbor in his 244-foot yacht, Katana, and snipes away at the competition. Paul Allen, whose Microsoft holdings have allowed him to dabble in sports he might not ever have had an interest in (yachting, for example), shows up in his 301-foot Tatoosh, and soon enough, rumors circulate that Ellison has commissioned plans for a larger yacht.

As all the billionaires are more or less self-made, the ego is understandable, even enjoyable. Although the Auld Mug, sport's oldest trophy, is supposed to be what it's all about, something much more elemental is really going on. Look up and down Syndicate Row, a sort of gasoline alley along the side of Auckland's shiny-new Viaduct Basin. One high-tech boat garage after another looms, one grander than the next, until you get to favored Alinghi, the Swiss team backed by Ernesto Bertarelli, heir to a pharmaceutical fortune. Forgetting for the moment that Bertarelli's yacht, Vava, moored nearby, is a paltry 150-footer (and forgetting, most of all, that Switzerland is a landlocked nation; how does he get home in that boat?), your breath is taken away by the size and scale of his pink-colored base of operations (dubbed the Geneva Hilton) -- said to cost a flabbergasting $2 million compared with about $500,000 for his equally rich neighbors.

But then, it's yachting's oldest story: My dock is bigger than your dock.

For scale, to establish a reference point, we start at the very first dock on Syndicate Row, Team Dennis Conner. Because he alone is not a billionaire, the legendary Conner is cast as the last of a dying breed, the amateur sailor getting by with duct tape and plenty of Scopoderm. Well, compared with Ellison's Oracle BMW Racing team and Craig McCaw and Allen's OneWorld syndicate, Conner's is indeed a bargain-basement entry. Team Dennis Conner, representing the New York Yacht Club (but not funded by it), has a budget of just $40 million, less than half the going burn-rate of his billionaire colleagues -- "the Bees," he calls them.

Conner launched his latest crusade in July when he introduced his two Stars & Stripes boats in Long Beach, Calif., whereupon one of them promptly sank when it lost its rudder. He makes no apology for his penny-pinching entry, though, insisting his experience in eight previous Cups (he's won four) more than makes up for the skimping he has had to do on development and prep time and manpower. (His 70 men do the work of Ellison's 150.) But he has no illusions about what an additional $10 million would mean. "I'd be faster," he says.

But just because Conner is not a billionaire doesn't mean he's particularly reasonable. Preparing for a quarterfinals repechage duel with higher-seeded OneWorld two weeks ago (O.K., repechage means second chance, as some defeated boats get another shot to vie for a spot in the finals), he paused for an interview in the sponsor tent, alongside the sponsor yacht, next door to the Team Dennis Conner gift shop, which was beside a little museum of his watercolors and a collection of historical scale-model America's Cup boats (which were charming, ropes and planks everywhere). The overwhelming impression was, this is what Brian Wilson would be like if he owned a 12-meter racing yacht.

Conner may be the shrewdest sailor to ever put zinc oxide on his nose, and he clearly knows how to raise money (although he is not particularly discerning; his main sponsor is Computer Associates, which is being investigated by the SEC for alleged financial malfeasance). Still, his joy in this ultimately hopeless competition is unsettling.

"I have everything I need," says Conner, bulkier than in his heyday and no longer a helmsman or even a crew member. "I've got two nice boats, and what a story, when one of them was on the bottom of the ocean four months ago. It's just a thrill to be here, son of a fisherman, competing against four of the world's richest men. What a story! What an event!"

He is keen about the history of the Auld Mug and is untroubled by the billionaires who would buy it out from under him. Whether it's the Prada team drastically cutting its boat in two for mid-challenge alterations, or Alinghi stealing away New Zealand skipper Russell Coutts for a reported $5 million, it's all the same to him. "It was always about wealth, from the beginning, going to Europe to flex American muscle. Sir Thomas Lipton spent $50 million on revenge [in numerous Cup tries in the early 1900s]. And lost!" He lets that sink in, then slaps his bare knee. "And if you win, you get nothing!"

The idea delights him. "I gotta be moving," he says and jumps up, to schmooze a donor, to consult the weather, to devise a tactic for his helmsman. "I was on the cover of TIME," he reminds you, and away he sails, a beached boy now.

The America's Cup is unrivaled in its attractiveness to crackpots, the richer the better, of course. Sir Frank Packer, the media mogul who bankrolled Australia's doomed challenge 40 years ago, was once asked for the motivating themes in his campaign. "Alcohol and delusions of grandeur," he said. As this group does not seem to be a particularly hard-drinking bunch (a few of the billionaires -- including Bertarelli and, when his skipper allows him, Ellison -- have remained fit enough to take their places among the crew on their boats), it is left to delusions to explain participation.

Bruno Troublé, a Louis Vuitton spokesperson, who skippered for Baron Bich in 1980 and has been around America's Cup sailing for a quarter-century, thinks it's all about a last stab at immortality. "If Larry Ellison wins," he says, "he will be part of history, like Vanderbilt. He will escape from the years on earth. [There are] not too many means to do that."

If immortality is at stake, no reason to go after it halfheartedly. But for Ellison, a lifelong sailor, the event is also a platform for his grandiose and combative personality. He first sparred with Prada, which had accused Oracle of spying on its boatyard from behind mirrored windows. (Oracle folks said the sun was in their eyes.) When Prada went to court -- a no-no in America's Cup rules, lest the event forever be decided by litigation (though it often is anyway) -- Ellison requested a forfeit.

That was just a warmup. Ellison seems to particularly relish the presence of OneWorld, which he has somehow cast as a business rival -- for the moment replacing his obsession with world's richest man Bill Gates -- as well as a yachting opponent. Always the provocateur, he's tweaked the team for its environmental theme ("You'd think if they want to help the oceans, they'd spend $85 million on the oceans, instead of a boat," he told The New York Times earlier in the season) and its Microsoft technology (its e-mail is "riddled with viruses").

This is somewhat bewildering, as OneWorld has a very distant relationship with Microsoft. "Well, not one at all," says OneWorld spokesman Bob Ratliffe, who maintains the official attitude of puzzlement. (Unofficially, the attitude is something else.) "I mean, Paul [Allen] has been gone from Microsoft for 20 years."

Ellison, in the fashion of old-time tycoons, enjoys the spotlight, appearing in his black Armani at press conferences when he can, often to say how busy he is with Oracle work on board Katana (or even in one of the sponsor cars, which are tricked out with an Internet connection). And, until he left New Zealand following Oracle BMW's survival of the quarterfinals, he was almost always a source of some bombshell, whether it was icing one skipper, Paul Cayard, in favor of Kiwi Chris Dickson, replacing Dickson with Peter Holmberg after crew protests and then, after a troubled beginning in the round-robin, replacing Holmberg again with Dickson (after which the boat won 11 straight races). It was even news when Dickson, enjoying his maritime authority, kicked a surprisingly agreeable Ellison off the boat altogether. Ellison liked to steer the boat on upwind legs during leads. But who needs a part-time front-runner?

Ellison's swagger has been especially hard to endure for OneWorld, a likably earnest group, which insists on the purity of the event, hits all the right notes environmentally and generally behaves in a modest fashion. Its boss, McCaw, is pretty low-profile for a billionaire, not pretending to be a sailor for one thing, or king of the world for another. But the group has had its problems, beginning with the decimation of McCaw's wealth in the last two years ago. According to FORTUNE, his net worth went from $13 billion to $1.8 billion. (His XO Communications baby went bankrupt.) Suddenly America's Cup boating began to seem like an extravagance (just in case you were wondering exactly when an $80 million boat race starts to seem like an expensive idea). He put the assets up for sale and was ready to dry-dock his dreams.

But Paul Allen, whose wealth was better protected by Microsoft's share price, stepped in for his Seattle buddy. He first wrote a $10 million check, and then some more, until he became a 50-50 partner in the scheme.

OneWorld has set itself up as an Oracle alternative, which is to say, it's on the side of the angels. At Oracle's base there is a row of nine BMWs, parked nose out. At OneWorld, staffers putter around on electric bicycles.

OneWorld did rankle Conner when it got to pick its opponent -- by virtue of its record in the quarterfinals -- and chose his boat over the Italian or Swedish entries in last week's repechage, thus ensuring that one American team would be sent home. (It was a good call, however; OneWorld swept Stars & Stripes in four straight races.) Even so, OneWorld presents sailing as a loss-leader in its true mission to save the world. It has calculated the amount of emissions from its various chase boats and has planted, in exact remedy, 10,000 trees on the slopes of an island volcano. And every night crew members wash the boat's $40,000 sails with collected rainwater, to further spare the environment.

They would probably be more lovable, for all that, if Allen weren't tootling about the gulf in Tatoosh (bought from McCaw), one of the world's 10 largest motor yachts, a full 57 feet longer than Ellison's, one-upping the Oracle man's onboard basketball court with his own afterdeck helipad. Between Tatoosh and Katana, there aren't enough trees in all the world to absorb the maritime pollution.

OneWorld can afford to look ridiculous; that's the prerogative of the rich. But to look sinister, as it did when it admitted having knowledge of New Zealand's 2000 design, was perhaps fatal to its p.r effort. Part of the problem stems from OneWorld's lavish spending; it brought in lawyer Sean Reeves, who worked for New Zealand in 2000, to be its rules advisor, and hired Laurie Davidson, who had designed New Zealand's boat. (The business with Reeves ended badly. OneWorld fired and sued him amidst bitter recriminations.) OneWorld insists it tried to do the right thing, self-reporting its violation, and it was penalized a point in an earlier round for its indiscretion. But now Conner's just-defeated team wants OneWorld disqualified altogether. A hearing will be held on Dec. 6 and 7 to sort the whole mess out.

Good thing for the intrigue, because the event, unfortunately, is not much fun -- or even very possible -- to watch. A bunch of party boats leave the harbor every morning, charging about $45 a person, and linger in the shadows of islands around the Hauraki Gulf sidelines, although what there is to see is anybody's guess. This is a sport without a visible finish line, remember, so a certain seafaring sophistication is required. Otherwise, it's just boats going back and forth.

Plus, it has sport's most confusing vocabulary -- unless you were born to the yachting life. Does the following passage of authentic America's Cup gibberish send chills up and down your spine? "We had a bad tack right up toward the first beat. We were pretty close to the starboard layline. It was unfortunate, but we just had a bad tack and were forced to go back and clear a sheet, which put us pretty close to the mark.... " O.K., how about discussion of an "unseamanlike luff." That raise your hackles? It should. It cost one billionaire a penalty point.

There is -- once in a while -- the spectacle of two Kevlar-coated bows plunging through the brine at the (invisible) finish, seconds apart after two hours of racing. But even so, what's the excitement? Is it a triumph of technology, ordained on a naval architect's drawing board years ago? Or is it a spectacle of seamanship, a helmsman shrewdly anticipating his opponent's tactics? Or, as these billionaires must themselves believe, is it just a matter of checkbook sailing? The four contenders who were still in the hunt at week's end, Oracle BMW, Alinghi, Prada and OneWorld -- assuming the latter survives its hearing -- all have the curiously identical advantage of nine-zero backing.

So it's a little hard to cheer for. But what everybody can appreciate is the naked yearning, the unapologetic ambition, the desperation of ego. America's Cup is the ultimate demonstration of desire, what's left when every appetite's been fully satisfied. And guess what? You still want more! Nowhere else is the human condition this transparent, writ quite so large, than way down under in the Hauraki Gulf.

Issue date: December 9, 2002