Handicapping The Olympics US TV Rights Bidding

[TMC1982]

Fang's Bites: Handicapping The Olympics US TV Rights Bidding

As the International Olympic Committee gets closer to choosing a host for the 2016 Summer Games (Chicago, Rio de Janeiro, Tokyo or Madrid), the bidding for the US TV rights is getting hotter.

In story for tomorrow's USA Today, Michael McCarthy writes that ESPN/ABC plan to make a spirited bid for the 2014 and 2016 Olympics. While NBC has broadcast the Olympics dating back to 1988, it has hardly had challenges especially when it made a preemptive bid for three Olympiads between 2004 and 2008 just a short few months after it snatched the 2000 and 2002 rights from ABC and Fox. and again for the 2010 and 2012 Olympics.

Based on the excellent ratings for the 2008 Olympics in Communist China, NBC is considered a heavy favorite for the 2014 Winter Games in Sochi, Russia and the 2016 Summer Games.

But as the announcement of the host city for 2016 is scheduled for October, and the bids for the US rights soon to follow, let's handicap the bids of each network and look at what has happened in the bidding for Olympics rights in other countries as a potential barometer.

First, let's look at what the International Olympic Committee has done for the 2014/2016 rights in Europe and South America. In December, the IOC chose to sever its ties with the European Broadcasting Union after a 50 year relationship. The EBU had distributed the Olympics among its members including the BBC and other public broadcasters across the continent.

Instead, the IOC chose to negotiate with each country individually hoping to gain more money and it turned around and sold rights to 40 smaller European countries to a conglomerate for $136 million. In Turkey and Italy, the IOC awarded TV rights to Rupert Murdoch-owned networks.

Bidding was just completed in Spain where state broadcaster RTVE retained its rights to air the Games.

However, the rights in the UK, France and Germany have yet to be determined for 2014/2016.

Late last month, the IOC received a record $210 million bid from Rede Globo for the Brazilian broadcasting rights, a 350% increase from the rights for 2010 and 2012 Games.

So what does this mean for the American rights especially if the IOC awards the 2016 Games to Chicago or even Rio de Janeiro which would mean a live primetime Olympics? Let's look at the networks.

NBC Universal - The incumbent and a worldwide Olympic sponsor through parent General Electric, the IOC has been pleased with its relationship with the Peacock Network. Two generations have known NBC as the Olympic Network. In addition, NBC has made a huge commitment to Olympic sports by purchasing WCSN and rebranding it as Universal Sports. However, in Canada and Australia, long time incumbents CBC and 7 Network were jettisoned in favor of new groups, CTV/TSN/Rogers Sportsnet and 9 Network/Foxtel, respectively. NBC will not allow the rights to leave without a huge fight especially if 2016 is in Chicago. And NBC would utilize USA, Bravo, Oxygen, MSNBC, CNBC and Telemundo just like it did in previous Games and expect Universal Sports to join the party for 2014/2016. Odds win the rights, 2-1.

Fox - It's no secret Rupert Murdoch wants the Olympics for his networks. He wanted the games in 2000 when the Olympics were in his native Sydney, but NBC put forth its aforementioned preemptive bid that took both him and Disney/ABC by surprise. However, as Murdoch has secured the rights for his networks in Italy and Turkey for 2014/2016, he's getting closer to his dream of broadcasting the Olympics globally. But Fox has little experience in producing Olympic sports having focused on the NFL, baseball and NASCAR. There was a short time when Fox had the rights to air figure skating events, but it lost those events to ABC. Murdoch has the money to bid, but it has yet to show it air a huge worldwide event other than the Super Bowl. Fox can use FX, Fox Sports Net, Fox Soccer Channel and even Fox News to show events. Odds to win the rights, 10-1.

CBS/Turner Sports - This combination aired the Winter Olympics in 1992, 1994 and 1998. It was a partnership that worked rather well. TNT was the first cable network to air the Olympics, however, it aired sports that CBS did not want to show. In this case, the partnership would be more equal. One advantage that Turner has is its relationship with the NBA and its previous airings of the FIFA World Basketball Championships. CBS can tap into its previous experience of doing the Winter Games which it did rather well especially in 1994 and 1998. Based on this partnership, you could expect CBS, TNT, TBS, CBS College Sports and maybe even Showtime along with CBSSports.com and SI.com to be in the consortium. In addition, CBS has experienced Olympic hosts in Greg Gumbel and Jim Nantz. While this group will have a seat at the table, I'm not sure if it has a shot to get the games. Odds to win the rights, 25-1.

ESPN/ABC - This is the wild card in the room. ESPN with the 2010 World Cup and other international events like the Tennis Grand Slam, the Open Championship and the English Premier League wants to show it can be a global network. While ESPN treated the World Figure Skating Championships rather poorly in the last years of a money-losing contract, you can bet it will treat the sport much better if it gains the Olympics. And ESPN has shown it will throw money to outbid its rivals as was the case for the Bowl Championship Series, the Open Championship and the US Open. This will be NBC's biggest rival for the Olympics. Not only does it have ABC, ESPN, ESPN2, ESPNU and ESPN Classic for events, it can tap into ESPN360 for the internet streaming rights, use the well established ESPN.com as an Olympics internet site, bring ESPN the Magazine to the table as the official Olympics magazine and even utilize Lifetime for gymnastics and figure skating in the same way NBC used Oxygen for those events. Odds to win the rights, 5-1.

It's going to be interesting to see what happens with the bidding. Had the 2008 Olympics not been a huge success across the board for NBC Universal on broadcast, cable and the internet, the interest would not be so high. But with the combination of having the Games in the Western Hemisphere especially if they're awarded to Chicago or Rio, the rights to broadcast the Olympics could reach over $3 billion with most of that being for the 2016 Olympics. We'll keep an eye on the bidding for you.

 

[Claude Greiner]

It makes no difference to me what network carrys the Olympics. I know alot of people watch it, but I just see it as an inconvience that interrups regularly scheduled programming that I would much rather watch.

Atleast they are not going to try the PPV olympics again like they did back in 1992

 

[SamCdbs]

I really do not care for the Olympics. Therefore I would hope ESPN does not get them, because it would take away from its coverage of other sports that I enjoy.

I would disagree with the article in one respect. Fox Sports Net does not belong to Fox. It is a cooperative of nearly 30 regional channels in wich Fox (the News Corporation) ownes various %ages, ranging from 100 to 0. Getting the entire FSN on one page, given most members nearly daily commitments to its local teams would be problematic. Getting the non-News 100% ventures to contribute to the money losing bid on the Olympics would be, IMHO, impossible.

Really, the best option, IMHO, would be for one (or maybe two) broadcast networks to carry the primary games and then have the providers spool up 5 or so extra channels and leave the current channels to carry their normal fare.

 

[Will94]

I will be interested to see how CTV/TSN/Sportsnet handle the Olympics. I loved the CBC's coverage. They showed as many sports live as they could as opposed to NBC's long list of features about athletes, their struggles, local cuisine/history and so on.

I've read repeatedly over the years that NBC believes its core Olympic audience is women who aren't sports fans, and because of the premium that they pay for the Olympics, it's all about ratings.

I've also read that the CBC never paid much (even adjusting for population) because the IOC didn't think there was another network in Canada that had the exposure of the CBC. I have no idea how much CTV/TSN/Sportsnet paid for rights, but I am hoping that they provide coverage similar to what the CBC did.


The only time that I *ever* watched anything on CBC Country Canada was ski jumping during the 2006 Olympics. How do you go off of a 90 meter jump for the first time?!? My favorite event off all the Olympics. I wonder what Britain's Eddie "The Eagle" is up to these days?

 

[TMC1982]

It makes no difference to me what network carrys the Olympics. I know alot of people watch it, but I just see it as an inconvience that interrups regularly scheduled programming that I would much rather watch.

Atleast they are not going to try the PPV olympics again like they did back in 1992

In fairness to NBC regarding the ill-fated Triplecast, the back in 1992, didn't have the luxury of mutliple cable outlets like MSNBC or USA Network like they do now.