I'd never been to Valencia, Spain, the Mediterranean arena for the 32nd America's Cup Match, but when I arrived there in March to visit with BMW Oracle Racing, I was astonished to see that the waterfront of Spain's third largest city had been transformed from an unsightly port to a vibrant, buzzing Cup village unlike any I've seen. All 12 teams are located at the head of Valencia's large ship basin, and a new 800-yard canal allows the Cup yachts to be on the racecourse in less than 20 minutes. When an onshore breeze blows, as it usually does, the starting line will be close to the shore. There are also two new marinas, one for mega yachts, and a 400-slip facility for smaller boats. All this work has been achieved in only two years. With this construction as a backdrop, Cup teams were busy themselves, putting the finishing touches on their bases, and in some cases, launching new boats, and more recently, ramping up their sailing in preparation for the 2006 Louis Vuitton Acts, which started in May. During my visit it was immediately obvious that the collective effort being expended is extraordinary, even by the Cup's lofty standards. The accelerated use of technology and continuous training and racing is unprecedented, and I sense that this 32nd Defense promises to be a huge spectacle that, in the end, will be uncharacteristically close. Larry Ellison, head of America's only challenging syndicate, came close in 2003 in his first campaign, and he returns with a full-bore effort. Ellison, who thrives on the challenge of a Cup campaign, once told writer Ivor Wilkins, "Sport has this finite, clear ending that is not present in business. That clarity between winning and losing is a dramatic difference. In business, there are more gray areas. In business, there are lots of winners. Being second is not so bad. In the America's Cup, there is no second." He clearly understands what's at stake this time around. The scope of changes in the America's Cup format, its venue, and the expense is mind-boggling, but when you peel back the layers, this event still comes down to a sailboat race, and, as with most sailing races, you can count on surprises along the way. One challenge the teams will face is matching the design configuration of the boats to the anticipated weather. BMW Oracle's design coordinator, Ian Burns, says the average wind is good (15 to 18 knots), but there are many weather extremes in Valencia. In other words, luck could have a significant impact on the outcome of Louis Vuitton and Cup matches. History is a helpful guide to what might happen in Valencia. In the past 30 years, the team that has spent the most money has not won the Cup. It's the fastest boat that always wins, and it's people that generate a boat's speed. Thus, the success of BMW Oracle's campaign rests heavily on the shoulders of CEO and skipper Chris Dickson, who is sailing his fifth Cup campaign. In 1986 Dickson steered New Zealand's Kiwi Magic to an impressive 37-1 record before falling to Dennis Conner's Stars & Stripes in the Louis Vuitton Cup finals 5-1. Dickson was 24 at the time, and is now the same age as Dennis Conner was for that very match. After being benched by Ellison's team for much of 2002, he was brought back at the 11th hour only to run into Alinghi in the Louis Vuitton Cup final for another tough defeat. Maturity and experience count for a lot in this game, however, so this could be Dickson's time. He's a tough character to say the least, hard on his competitors, his crew, and most of all, himself, and having never won the Cup, he's hungry. John Kostecki and Gavin Brady left BMW Oracle late in 2005, but the team seems to be performing better without them. Dickson needs a supporting cast that understands his demanding style and temperament and navigator Peter Isler and tactician Bertrand Pace, of France, are well cast for their respective roles. All the pieces are in place for BMW Oracle to excel and the team exudes the impression that it's a smooth-running operation thanks to abundant, initial funding. Team engineers, working alongside engineers from BMW, are focused on what they describe as a "technology transfer." Professor Dr. Raymond Freymann, of BMW, is leading this effort, and he told me, "the inside of the hull is the most complex part of the construction." BMW structural engineering expertise is being integrated into the yacht design, and even the foul weather gear is customized for every different position on the boat. Farr Yacht Design, based in Annapolis, Md., is once again teamed up with BMW, as is Juan Kouyoumdjian, of Argentina, the designer of the Volvo Ocean Race's runaway leader, ABN AMRO One. Bruce Farr is now on his seventh America's Cup campaign, and like Dickson, he's anxious to get his hands on the one prize that has eluded him so many times. The amount of performance data being collected has clearly escalated this time around, and Burns explained how the research is conducted. "We start with experimenting in towing tanks, wind tunnels, and computers," he said. "Next, we spend time studying results using computational fluid dynamics. Out on the water we keep track of data using a Wi-Fi system. Finally, we analyze the boat's performance based on the perception of the sailors. It's important we customize our design for our team's sailing style. Alinghi needs a different boat because they have a different style." BMW Oracle's compound is one massive operation. It includes a high-tech boatyard, a research lab, two boat bays, a mast crane (in 2005 their masts were taken out 170 times), a sail loft, an oven to bake boat parts, locker rooms, meeting rooms, rigging shop, two travel hoists, machine shop, fitness center, storage, electronic shop, weather studio, offices, and a huge hospitality center on the top floor with two bars, television screens, comfortable lounges, and a commanding view of the harbor. Team members spend long days at the base, and they move about with a purposeful style. During a rare tour of the facility, I found the sailors, designers, engineers, and workers were cordial, but extremely focused. There's no substitute for time on the water and the Louis Vuitton Acts scheduled this summer will give the sailors and designers an opportunity to test their new designs. The question every team will wrestle with is when to sail their new boats against the opposition? In my view, early testing will make a big difference later. The ultimate winner will use their new equipment early. The most important thing that can happen is to develop a system where the team can quickly make improvements and changes. Historically, America's Cup contests are one-sided matches (1920, 1934, and 1983 are the only exceptions), but the Cup in Valencia will absolutely feature close racing. The new America's Cup Class Rule calls for similar lengths, sail area, and displacement, so the premium will be on weight saving, sail shape, construction, and most of all, sailing skill. Blending the knowledge of the sailors and the scientists is a tough task, but Ellison is used to merging the talents of many people in his businesses, and he has put all the pieces in place to do the same in the America's Cup. I'd be surprised if BMW Oracle Racing, Italy's Luna Rossa, or Emirates Team New Zealand do not reach the final to square up against the defender Alinghi. No matter what happens, it will certainly be fun to watch.