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Media & Entertainment Law

: Sports Biz

Olympics Proving to Be Huge TV Draw

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The Olympics is one of the most consistent TV properties in the world. It has always been something that draws a large viewership in the US, which is why NBC paid a whopping $820 million for the Vancouver Games, part of a $2 billion package of US rights it won in 2003. No matter how high the viewership turns out to be however, NBC is projecting that it will lose upwards of $250 million on this year's Games. Part of that is due to production costs, as this is the first Olympics to be televised entirely in High Definition and part of that is due to the costs associated with producing 835 hours of mostly live (in itself an unusual departure for NBC) across the NBC family of networks. However, by far the predominant reason is that NBC assumed an ever rising market for sports sponsorship and never counted on the having to deal with the impact of the Great Recession. As a result of the economy's crash, the market for sports advertising crashed along with it, and instead of the rising rates NBC expected from 2003, and factored into its bid, it now faces a market yielding lower rates than it probably got for the 2004 Summer Games.

The viewership figures have been very impressive. The opening ceremonies was the most watched ever for a non-US Winter Games up 48% from Torino, and the first two days is running 13% ahead of Torino.

Those numbers pale in comparison to television sets in Canada however. The opening ceremonies were watched by more than two-thirds of all Canadians, smashing the previous Canadian television record. About 23 million Canadians watched at least some part of the show, and about 13.3 watched all of it. About 32.6 million Americans watched the opening ceremonies, and for comparison sake, the population of Canada is roughly ten percent of the US population. The Games are being broadcast in Canada by a partnership between CTV and Rogers Cable, and in English, French and native languages.

Full post as published by Sports Biz on February 14, 2010 (boomark / email).