- The Washington Times - Wednesday, March 18, 2009

LONDON (AP) - The International Olympic Committee could end its revenue-sharing deal with the U.S. Olympic body unless the Americans agree to a revised formula and smaller share of the money pie, according to a top official involved in the negotiations.

IOC executive board member Denis Oswald told The Associated Press that the U.S. Olympic Committee must make concessions at a key meeting in Denver next week or face possible cancellation of the long-standing revenue contract that has riled many international sports officials.

“If there is no agreement, then we would possibly terminate the contract and completely renegotiate another one,” said Oswald, who heads the Association of Summer Olympic International Federations.

The revenue issue has strained relations between the USOC and the international Olympic movement for years and now threatens to hinder Chicago’s bid for the 2016 Summer Games in the final months of the campaign.

Under the open-ended contract, the USOC receives nearly 13 percent of Olympic television rights fees and 20 percent of global marketing revenues.

U.S. companies pay well more than that percentage into the IOC’s overall budget. NBC paid about $894 million to televise the Beijing Games last year, compared to about $443.5 million from the European Broadcasting Union and $7 million from Chinese networks.

Still, some IOC members, international sports federations and national Olympic committees have complained bitterly that the U.S. continues to receive the lion’s share of money. The U.S. slice was about $300 million for the 2005-08 cycle and could be $450 million for 2009-2012.

“We still feel it is not acceptable they can get as much as all the NOCs receive together,” Oswald said, referring to the other 204 national Olympic associations.

Bob Ctvrtlik, the USOC vice chairman for international relations, said the American federation is preparing for talks next week in Denver.

“As we have for two years, we’re trying to find a solution that benefits all members of the Olympic family,” Ctvrtlik said.

But the global financial crisis could make a deal more difficult. The USOC is cutting its work force by up to 15 percent and trimming about 5 percent out of its $142 million 2009 operating budget.

“It would have been easier a year ago,” Oswald said. “They are claiming they are hit by the financial crisis. Of course they are hit just like everybody else.”

The revenue contract was negotiated in 1996 and has no specific time limit, but the IOC believes it can cancel it and renegotiate a new deal to take effect in 2020.

“It is not possible to have a contract that has no end,” Oswald said in a telephone interview from Lausanne, Switzerland. “We feel, and our American lawyers agree, that if we give sufficient notice, we can terminate it. We cannot be bound for life. We feel that if we terminate it now, they (USOC) have plenty of time to take measures in order to cope with this termination.”

The point man from the USOC side had been Peter Ueberroth, who stepped down as chairman in October. He has been replaced by Larry Probst.

Oswald, who met briefly with Probst in Lausanne recently, said Probst indicated the global financial crisis made it more difficult for the USOC to accept a reduced share, but showed signs of being open to discussions _ as did Ctvrtlik.

That could signal a shift from the position advocated by Ueberroth, who took a swipe at international officials in his final speech as USOC leader in October.

“Who pays the bill for the world Olympic movement?” he said. “Make no mistake about it. Starting in 1998, U.S. corporations have paid 60 percent of all the money, period. Be sure you all understand that. The rest of the world pays 40 percent. It’s pretty simple math.”

Oswald said the situation has changed since the contract was signed, with more international companies now sponsoring the Olympics, including Samsung, Panasonic, Omega, Acer and Atos Origin.

IOC president Jacques Rogge said in December that he hoped an agreement could be finalized by the March 25-27 IOC executive board meeting in Denver.

The two sides had been scheduled to hold talks during last week’s Pan American Sports Organization meeting in Guadalajara, Mexico. But the talks were postponed after USOC officials said they had scheduling conflicts, Oswald said.

Now they will try to arrange a meeting in Denver during the SportAccord conference the same week as the executive board meeting, leaving little time to hammer out a deal.

“I’m not very optimistic,” Oswald said.

If the U.S. side shows no sign of compromise, Oswald said he would recommend to the ruling board that the contract be terminated.

“Whether I would be supported by the others is another question,” he said.

Also on the IOC negotiating team are IOC marketing commission chairman Gerhard Heiberg of Norway and Mexico’s Mario Vazquez Rana, head of the world’s national Olympic committees.

“I don’t want to bet at this stage,” Heiberg told the AP. “It’s important to sit down, listen to each other and hopefully fully understand each other and find agreement based on common understanding.”

Oswald wants the USOC first to agree to pay a share of games-related costs, including for the World Anti-Doping Agency, Court of Arbitration for Sport and judges and referees.

While each national Olympic body pays a proportional share of those costs, the USOC has been exempt. It should pay a four-year share of around $15 million, Oswald said.

Beyond that, the IOC wants the USOC to “compensate” the committees and federations which are receiving far less in Olympic revenues and to agree to a new formula for 2020.

The dispute hangs over Chicago as it competes against Madrid, Tokyo and Rio de Janeiro for the 2016 Olympics. The IOC will vote on the host city in Copenhagen on Oct. 2, and Chicago’s chances will not be helped if the revenue spat is still alive.

“I hope we can leave speculation about Chicago out of the meeting and concentrate on what we are there for,” Heiberg said. “I understand some people will have Chicago 2016 in the back of their minds. My standpoint is to leave that out of the discussion completely.”

Ctvrtlik said the IOC recognizes the negotiations don’t happen in a vacuum, but he doesn’t think the Chicago bid will be held hostage by the revenue-sharing issue.

“We’ve signed written existing contracts, so there’s no deadline,” he said. “But as one member of 205 national Olympic committees, we feel a responsibility and an obligation to continue to work to seek unity and grow sport.”


AP National Writer Eddie Pells in Denver contributed to this report.

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