Oracle CEO Larry Ellison is revamping boats and TV technology to bring the America’s Cup sailing race to a mass audience. (Paul Sakuma/AP)

The doors of Larry Ellison’s waterfront hangar on San Francisco Bay slide open, and more than a dozen men in hard hats roll out the billionaire’s latest technological marvel. Built to defend the America’s Cup starting here on Sept. 7, Oracle Team USA 17 is a catamaran named after the company that made Ellison the eighth-richest person on the planet.

The twin-hulled black and crimson racer measures 72 feet long, 46 feet across and 131 feet tall to the tip of its rigid carbon-fiber mainsail, which resembles an airplane wing. On this sunny April morning, the crew members push the 6.5-ton boat they call “17” to the edge of a pier, where a crane hoists it into the water for its maiden voyage.

In the open water, as crew members lift the forward sail and spin their winches, the boat begins to accelerate quickly. As it turns across the wind, the hulls rise about four feet out of the water — what sailors call “flying.”

The vessel is supported by just three small hydrofoils that extend from the hulls into the water. The cutting-edge design of 17 and its three rivals from Italy, New Zealand and Sweden — championed by Ellison — makes them capable of speeds of 46 miles per hour — the fastest boats ever to race in the 161-year-old America’s Cup. That’s faster than vehicles are allowed to travel on the nearby Golden Gate Bridge that spans the bay.

These cats are also among the most perilous boats ever to race in the America’s Cup, says Cup historian John Rousmaniere, who has written books on sailing.

On May 9, the 72-foot cat from Sweden’s Artemis Racing was moving at high speeds when it nose-dived during a practice run, flipping over and breaking into pieces. Briton Andrew Simpson, 36, a gold medalist in the 2008 Olympics, was trapped under the wreckage and died.

“When they go from 40 to zero, you get flung off like a little bug from the top hull, not knowing what you’re going to crash into,” says Randy Smyth, a Cup champion in 1988. “But the America’s Cup has always been run by billionaires, and those people don’t think small.”

The 34th America’s Cup is Larry Ellison’s event. Ellison, 68, won the last Cup in 2010, and as champ, he has the most say in determining the boat design and rules for the next competition. The entrepreneur has brought his money, tech savvy and showmanship to this year’s Cup, the first to be broadcast on U.S. network television since 1992.

A driving ambition

Ellison started Oracle in 1977 and is now worth about $37.8 billion, according to the Bloomberg Billionaires Index. Over three years, Oracle Team USA and its three challengers will probably spend more than $100 million each on their boats, crew, facilities and support staff, says Gary Jobson, a sailing analyst for NBC who won the Cup in 1977. The catamarans alone cost about $8 million each to build.

These ultrafast vessels are the key to Ellison’s ambition to transform the event from a race for the sailing cognoscenti into a televised sporting spectacle that’s as thrilling to watch as Formula One auto racing.

The software titan’s team has jettisoned the plodding monohulls used in most prior Cups. Their top speed in the 2007 competition was about 20 mph. Ellison’s zippy boats can quickly pass one another like racehorses.

Unlike monohulls, cats sail fast in light and strong winds, reducing start-time delays that can ruin TV broadcasts. Rather than have the vessels race miles offshore, Ellison’s team set the event in the natural amphitheater of San Francisco Bay on oval courses as close as 500 yards from land at some points so spectators can enjoy the race.

The America’s Cup organization built the America’s Cup Park on the waterfront and, with entertainment company Live Nation, added a 9,000-seat pavilion for concerts and watching the race on a large display. And to improve TV viewing, Cup officials hired Stan Honey, the graphics pioneer who developed the yellow line used in National Football League telecasts to show the distance to a first down.

Honey, the America’s Cup director of technology, and his team are creating on-screen overlays for NBC that will show which boat is leading, each vessel’s speed and the wind direction.

“The broadcasters used to say, ‘Where’s this race going to take place?’ And we’d say, ‘Out there,’ and point across the ocean,” says Russell Coutts, the New Zealand-born chief executive officer of Oracle Team USA. “Now, we’ve got the basis of a good TV product. And the race is a lot more interesting for the athletes. It’s more tactical.”

Ellison’s bold retooling of the Cup has driven away at least as many teams as it has lured. Although a 2010 economic impact report commissioned by the city of San Francisco estimated that as many as 15 teams would participate in the event, only four have been willing to tackle the difficulties of building and racing a 72-foot cat that rides above the water.

“The cost is phenomenal, while the technology, experience and skills to build and operate these 72-foot catamarans are quite rare,” Rousmaniere says.

Coutts, 51, said before the accident that his team’s decision in 2010 to use 72-footers for the Cup was a mistake. He believed then that the 72s would look better on TV than smaller cats, which are less costly to build and slower.

Coutts later discovered during the televised America’s Cup World Series beginning in 2011 that 45-foot cats played well on the screen.

“We were paranoid this needed to look good on TV,” Coutts says. “I thought the 45 would look too small. It doesn’t. It looks fine.”

Since 1851, the Cup has attracted rich men who squandered chunks of their fortunes. “Bigger is better,” says Peter Isler, a two-time winner from the United States. “It’s the America’s Cup. It’s an idiosyncratic event run like a duel from the 19th century.”

Thomas Lipton, a Scot who founded a tea empire in the late 19th century, challenged reigning Cup holders five times without success from 1899 to 1930, in boats named Shamrock. Harold Vanderbilt, the great-grandson of railroad tycoon Cornelius Vanderbilt and a three-time Cup champion, defeated Lipton in 1930.

“The ambition of a lifetime, to achieve which he has spent millions, is perhaps never to be realized,” Vanderbilt said after beating Shamrock V, according to the America’s Cup Hall of Fame in Bristol, R.I. “It has been our duty to shut the door in his face.”

Torbjorn Tornqvist, the billionaire co-founder of commodities-trading company Gunvor Group, says he couldn’t resist the opportunity to compete in this year’s Cup, his first. Tornqvist, who grew up sailing and has raced in amateur events, backs Artemis Racing, named after the Greek goddess of the hunt.

“Somebody says it’s like an ego trip,” Tornqvist, 59, said from his office in Geneva in April, before the crash of his team’s boat. “Maybe it is. It is personal ambition. It’s not justifiable in terms of cost.”

Tornqvist was willing to abandon his quest for the Cup after the Artemis sailor’s death. It was the first such tragedy related to the Cup since 1999, when Spanish crew member Martin Wizner lost his life after being struck in the head by part of the boat during training.

Days after the Artemis accident, Tornqvist flew to his team’s base in the San Francisco Bay Area and told his sailors they could drop out at any time, sources said.

On May 22, Artemis skipper Paul Cayard said in a statement that his crew would stay in the hunt if officials made racing the 72s safer. That same day, the America’s Cup Review Committee, a panel examining the accident, issued a set of safety recommendations.

The group suggested more body armor for sailors (crash helmets were already in use), hands-free oxygen devices and ending a race in the finals when wind speeds reach 26 mph, down from the previous limit of 38 mph. The U.S. Coast Guard issued a permit for the regatta on June 28, requiring it to adopt the recommendations as rules.

Coutts says Simpson was a wonderful sailor and that his death was horrifying. Even though the 72-footers are piloted by the world’s best sailors, they are still risky.

“There is an element of danger in this sport and other sports,” Coutts says. “What we have to try to do is mitigate those dangers as best we can.” Ellison declined to comment for this article.

Battles on and off the water

With Artemis’s new boat under construction, Cayard announced that the team would race on. The Swedish club will join Italy’s Luna Rossa, funded by billionaire and Prada CEO Patrizio Bertelli, and Emirates Team New Zealand, whose sponsors include Emirates Airline, in the preliminary Louis Vuitton Cup regatta, which begins July 4.

The winner will compete against Oracle for the America’s Cup trophy.

“Everyone in the sport will tell you it’s a lot cooler with 15 teams on the starting line,” says Zack Leonard, coach of the 2013 national champion Yale University sailing team. “The 72s clearly squashed that.”

Ellison, a pilot who has flown an Italian Marchetti jet fighter, also likes to go fast on the water. He jumped aboard his team’s 45-foot cat during the America’s Cup World Series regatta in August 2011 off the coast of Cascais, Portugal. The regatta was a warm-up for teams that might compete in the America’s Cup in 2013.

“It’s absolutely what we hoped for,” Ellison said afterward. “Close racing, and a lot of boats being passed. It’s extreme sailing, and that’s what people want to see.”

Oracle Team USA trains on Pier 80 in San Francisco. On a Wednesday afternoon in April, about 130 sailors, designers and support crew are hard at work in the cavernous hangar. A glassed-in lounge with a flat-screen TV allows sailors to review video of training runs.

In the gym area, in addition to the weight and cardio machines, there’s a mock-up of a 72-foot catamaran’s mesh deck, where sailors practice turning winches on a moving platform. Crew members can burn about 4,000 calories a day during workouts in the gym and on the water. Oracle captain James Spithill, 34, has 4 percent body fat.

Ellison’s first Cup victory, in 2010, came after a court battle that lasted more than two years. Alinghi, a team backed by Swiss billionaire Ernesto Bertarelli, had won the 2007 Cup. A newly formed Spanish yacht club was the first to file a challenge to take on Alinghi in 2010.

That normally would give the Spaniards the right as the challenger of record to negotiate with the 2007 champion over protocols. But the yacht club behind Ellison’s team, then named BMW Oracle Racing, sued Alinghi’s yacht club in New York Supreme Court, alleging the Spanish club couldn’t be the challenger of record because it had never even held a regatta. Alinghi’s club said the Spaniards did meet the requirements to challenge it.

The case was eventually decided in 2009 by New York’s Court of Appeals, which sided with BMW Oracle’s club and named it the challenger of record. Alinghi and BMW Oracle then agreed to a one-on-one showdown in 90-foot multihulls.

By then, Ellison had hired Coutts, the most successful skipper in America’s Cup history, to manage the BMW Oracle team. The New Zealander, an engineer with a passion for the mechanics of sailing, has amassed an undefeated record in single Cup races. The four-time champion steered New Zealand to its first trophy in 1995 and its second in 2000.

For the 2010 Cup, BMW Oracle and Alinghi met off the coast of Valencia, Spain, for a best-of-three series in February. Ellison and Coutts arrived in a fast 90-foot trimaran, boasting an innovative 223-foot, motorized, rigid wing sail made of carbon. Alinghi deployed a 90-foot catamaran with a fabric sail. BMW Oracle won the first race by 15 minutes. A second consecutive win gave Ellison his first trophy.

Within weeks of the win, Coutts sat down with Ellison to plan an event for 2013 that would captivate the public.

“Larry said, ‘We’ve got to improve the television product dramatically, and unless we can do that, we’re not going to grow the sport,’ ” Coutts says. “‘Let’s get the technology right first.’”

Ellison turned to Honey, an elite sailor himself, to enhance the way the Cup is broadcast. Honey, who earned a master’s degree in electrical engineering from Stanford University, co-founded the television graphics company Sportvision in 1998 and left in 2004. The firm created Major League Baseball’s pitch-tracking system, which shows the path of balls and strikes on-screen.

Winning TV viewers

Honey was racing a trimaran in 2010 through the Southern Ocean on the way to a record-setting 48-day circumnavigation of the globe when he learned in an e-mail from his wife that Ellison was looking for him. Honey jumped at the chance to develop graphics for his sport.

“The successful Sportvision systems brought out something important to the sport that happened a lot but was hard to see,” Honey says. “In football, the goal of every play is to get a first down, but it’s hard to see.”

With sailing, viewers struggle to figure out who’s leading and even the direction of the race. So Honey, using some Sportvision technology, developed a network of cameras and sensors mounted on the boats and overhead helicopters that shows these and other essentials of sailing as graphics on a television screen.

NBC will show the first two races of the Cup finals on broadcast television in September and the rest of the best-of-nine series on cable’s NBC Sports Network. Ellison’s team has some reason to be optimistic that the Cup will draw a sizable TV audience.

In April, more TV viewers in Italy watched the World Series race in Naples on a Saturday than the Formula One qualifying session, according to the America’s Cup Event Authority.

“That’s amazing,” Coutts says. “If you had said to me we were going to do that, I would have said you are dreaming.”

For Ellison, success will be measured both at the finish line and in TV ratings and box-office sales, Coutts says.

“Guys like Larry, if it was easy, they wouldn’t be in this game,” Coutts says. “They don’t have to do anything else. They’ve made their money. I don’t think life is fun unless they’re doing something major.”

The full version of this Bloomberg Markets article appears in the magazine’s August issue.