After dominating the early rounds of the Louis Vuitton Cup, BMW Oracle Racing has finally sunk into Valencian waters.

It was only 12 days ago that Gavin Brady declared at the end of the rounds robin that USA 98 was "formidable", a view shared by rivals and observers alike, and that Chris Dickson "was sailing better than I have ever seen".

Despite high expectations and the event's highest budget, the San Francisco-based team was was soundly defeated by Luna Rossa Challenge. So what could have happened to make the former invincible looking BMW Oracle look so eminently beatable?

According to Chris Dickson, the only reason of the Italian dominance is that Luna Rossa has taken a huge leap in performance.

"The reason for our departure is that they have excelled this week", he said at last night’s press conference. "We were outclassed by Luna Rossa in a number of areas this week. If there was something glaringly obvious we’d have done something about it."

"It wasn’t just one thing", he added. "They have been quietly building up and have grown a huge amount stronger. They have out-sailed us in many areas on the race course this week, they’ve had great speed upwind, enough speed downwind, started well, got those first wind shifts, made good tactical calls. That’s sport. They’ve done a fantastic job."

Luna Rossa are becoming increasingly comfortable with their equipment and their set-up, and it’s hard to see anyone getting the better of Spithill if he maintains this sort of form in the pre-start. If the Italians can maintain this upward trajectory they are going to be very dangerous indeed, a threat to challengers and defender.

"Luna Rossa’s James Spithill is probably the best match racing helmsman in the World right now", commented Daily Telegraph sports writer, Tim Jeffery. "Certainly in Cup boats and certainly in the absence of Russell Coutts".

Nevertheless, considering the fact that BMW Oracle had the best of everything, many commentators are in favour of a far simple theory : the human nature.

"In the first two races of the semis, Dickson and his crew got a fright when Spithill mixed things up", commented Yachting World's Matthew Sheahan.

"Losing one race and then winning the second, but only by the skin of their teeth, would surely rattle confidence. Taking a second blow in the third race simply compounded the problems. When the stress levels and tensions raise, the more errors are made. Then starts the vicious downward spiral. The more mistakes, the more errors and so on".

Breaking this cycle is extremely difficult and relies on an open dialogue and, as Paul Cayard predicted before the Semis, the main BMW Oracle Racing's was there.

It must be remembered that many people have predicted that the Chris Dickson building would broken down . Larry Ellison put Dickson in charge of his program top to bottom, as CEO, skipper, and helmsman making all decisions. It seemed to be working, until it wasn't, and BMW Oracle came up short in the semis.

"This is Chris Dickson's team, and right now I can't think of anybody else I'd rather have skippering the boat", said Juan Kouyoumdjian two weeks ago. "A few months ago I wasn't ready to say that, but he made it clear from the beginning that he was the guru on top, involved in every decision. That suits his management style, to work with people he trusts to supply recommendations, and then he rules. This will be his victory or his loss."

Meanwhile, Francesco de Angelis, Luna Rossa skipper, started out driving the boat and then decided to separate the functions and delegate the driving. His next (likely) rival is Team New Zealand, where team boss Grant Dalton never was the driver, but as a floater in the crew has the same sort of big-picture overview, combining shoreside and on-deck responsibilities without trying to be everything.

But even as he spoke signs of discontent spilled out, with the man Dickson ousted from the sailing team last September, French tactician Bertrand Pacé, commenting that the Kiwi was "dictatorial."

"The organisation of the team was too much like a pyramid. Dickson was at the same time skipper, manager, helmsman and designer. "We all knew that this dictatorial managerial style could not work," Pacé asserted.

"We manoeuvred badly and made too many errors", he added. "We are disappointed because we all thought we had a very good boat".

For Chris Dickson this could spell the end. He has had the most funding and resources of all the teams and he has failed to deliver again. After thanked Sten Mohr for stepping up to the helmsman’s job for the last match, he precised it wasn’t his choice.

"It was Larry’s decision to take me off, and I accept that and thank Sten for stepping in", he said. "I don’t think Luna Rossa need a lot of advice for the finals and they certainly don’t need it from me right now".

So, what future for BMW Oracle and what future for Chris Dickson?

"The future for the team is that Larry is committed to having the team continue. That was decided some time ago.", said Chris Dickson. "The future for myself is I signed up for this campaign and we’ve got a bit of wrapping up to do for a few weeks, then I’ll be quietly heading back to New Zealand and taking my family to Disneyland on the way home, probably. And life goes on."