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NBC primed for delay
Question of the Day
There’s big, and then there’s Beijing Olympics big.
NBC is about to embark on what is likely to be the most ambitious telecast in sports history with 17 straight days of competitions and ceremonies, both on television and online.
Included in the coverage is 2,200 hours of live Internet broadcasts, so virtually every sport will be available to view in one form or another.
Despite its heavy investment, NBC will profit from these games. The network announced last week it has sold 96 percent of its advertising inventory, thanks to a $50 million barrage of sales in the previous 10 days. The network is likely to reach its goal of $1 billion in ad revenue from the games, which would be a record.
“Advertisers, across a broad spectrum of categories, recognize the power of the Olympic brand and the opportunity to engage a mass audience,” said Seth Winter, senior vice president of sales for NBC Sports and Olympics. “With the recent flurry of activity, we will soon reach the point where we will hold back inventory to sell during the games. In an increasingly fragmented media landscape, live sports continues to resonate with advertisers and viewers.”
It’s interesting that Winter refers to “live sports.”
While NBC convinced the International Olympic Committee to move the high-profile swimming to the morning hours in Beijing to allow for prime-time viewing in the United States, only a portion of NBC’s prime-time coverage will be live. Most of that has to do with the 12-hour time difference between Beijing and the East Coast. At 8 p.m., most athletes either still will be in bed or loading up on carbs at the Olympic Village breakfast buffet.
But the network also has shown a willingness to air tape-delayed coverage of events for dramatic effect. NBC packaged the gold medal performance of the U.S. women’s gymnastics team at the 1996 Summer Games in Atlanta and presented it on tape delay in prime time.
Advertisers may not necessarily care, but there is a good amount of pressure on NBC to show it can broadcast the games well. The Olympics are the network’s marquee sports property, and it paid $3.5 million to broadcast the games from 2000 to 2008 and will pay an additional $2.2 billion to show the 2010 and 2012 games.
But then it’s back to competitive bidding, in which anything can happen. NBC has shown it’s willing to overpay, but Fox and ABC/ESPN are not likely to hand the games to the incumbent.
In the last round of negotiations in 2003 (for the rights to the 2010 and 2012 games), Fox and ABC each bid conservatively, in part because there was a lack of clarity on how the Internet and other technologies would be used to broadcast the games. But things are starting to shake out in that realm, and broadcasters now are more skilled in negotiating and determining the value of nontraditional broadcast rights.
What’s more, networks are likely salivating over the next potential big Olympics prize: the 2016 Summer Games in Chicago.
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