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Where Would The Ioc Be Without American Tv Rights?

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I know that the negotiations with the USOC and IOC have been put off, but this issue has come up again with the announcement of a USOC TV Network.

I posted an article to my blog today from a Chicago Tribune reporter basically saying that the IOC would be in a heap of financial trouble if it did not have US TV Rights, and he basically went on to say that the IOC should show more respect to the USOC, and allow them to keep the 12.75% of the revenue paid to the IOC from NBC. NBC paid $894 million for the Beijing Olympics (half of the total of all TV rights).

Here is the article

I don't really have my mind made up on this issue yet. I don't think that it is impractical to require that a certain percentage of the TV rights revenue be given to the USOC. I don't think the USOC should be acting like a spoiled child, but American sports involvement (promoted by the USOC), has vastly contributed to the Olympic movement, and quite frankly saved the Olympics from it's demise in the 1980's.

So, I guess my question is... do you think the USOC should make concessions, and drop their Olympic Network aspirations to please the IOC, or should they retain their current 12.75%?

.

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I have always been surprised by the fact people are mixing up various issues, namely, US contribution to financing the Olympic Movement and USOC's share of the revenue generated by the IOC.

First, US contribution by the Olympic Movement:

  • Fact: the US, through the broadcasters TV rights and the US firms taking part in the TOP programme contributes to the majority of the worldwide revenue generated by the IOC (the US share in these revenues is decreasing but is still the largest by far)
  • Fact: yeah, the US companies at one point probably saved the Olympic Movement as we know it or at east allowed it to develop the way it had
  • Fact: none of the US companies sponsoring the Games nor NBC are phylantropic companies -> they have a RoI that they found appropriate otherwise they wouldn't pay the huge of amounts of money they do; this RoI can be profits (NBC generated record profits during the Beijing Games), brand development in key markets (Johson & Johnson in Beijing)... There is absolutely nothing wrong with that but it is worth mentioning (it's not like those companies are acting out of pure generosity)

Second USOC share of the TOP revenues and TV rights:

  • As often pointed out, USOC relies solely on private funding contrary to most if not all other NOCs. The reason is simple: in 1978, the US Congress granted exclusive rights of the Olympic mark (that it didn't own anyways...) to USOC who could commercialize it in exchange of an agreement for no public fundings (the IOC has nothing to do with that)
  • Following the Los Angeles Games, the IOC launched the TOP Programme that USOC joined in exchange of a rather large share of the revenues (the IOC has probably a little careless on that matter signing a contract for a very long duration). One reason being that USOC claimed that the TOP programme would derive money from its own domestic marketing programme (which is difficult to prove but fair enough)

But USOC is indeed in a catch 22: if indeed their claim that US companies joining the TOP programme derives money from their own domestic programme is true, then the shift in the balance of US Sponsors Vs non-US sponsors would lead to the share of USOC in TOP revenue to decrease as well. If the claim is not valid, then there is no reason whatsoever for USOC to get a larger share of TOP revenue than other NOCs.

As for the TV rights, it's difficult to see what ground there is for USOC to claim for such a large share of it: the product sold (the Olympics) belong to the IOC not USOC. If an American broadcaster is willing to pay a large amount for the TV rights, what has USOC to do with it (OK, if the broadcasters pay that much it is because US viewers want to watch American athletes win a lot of medal in the Games, part of the credit belonging to USOC)? With this respect, it will be interesting to see what USOC will offer on its Olympic Channel as they don't have the rights to broadcast the Olympics (those rights belong to NBC up to 2012). It's worth mentioning that NBC is equally pissed off at USOC than the IOC is about the Olympic Channel.

USOC claim has some ground. However, things are much more complex than "Bad IOC taking money away from the US and not giving anything back".

One has to wonder whether USOC is truly interested in bringing back the Games to the US: spectacular lack of involvement of USOC senior leadership in the 2016 candidate cities various presentations (compared to Madrid and Rio especially), poor timing of Olympic Network announcement (it could have easily been delayed until after October). Many wonder in the Olympic circles what USOC is truly after. Should Chicago loses in October, USOC will also bear its large share of responsibility.

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^^^ Good post. It just shows that this is a complex issue.

Without the USOC getting money to help develop athletes, it could bring down the U.S. in medals, meaning maybe people won't be watching U.S. athletes as much.

Michael Phelps was a big component to the NBC viewership. Without athletes like Phelps, Americans won't follow the Games as closely.

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I believe the USOC should have some revenue stream with the TV rights, but I am not sure how one would actually quantify how much. I mean, is the IOC hurting for money? Could they be equally as greedy as the USOC?

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^^^ Good post. It just shows that this is a complex issue.

Without the USOC getting money to help develop athletes, it could bring down the U.S. in medals, meaning maybe people won't be watching U.S. athletes as much.

Michael Phelps was a big component to the NBC viewership. Without athletes like Phelps, Americans won't follow the Games as closely.

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I believe the USOC should have some revenue stream with the TV rights, but I am not sure how one would actually quantify how much. I mean, is the IOC hurting for money? Could they be equally as greedy as the USOC?

The IOC redistributes more than 92% of its revenues to the Olympic Movement: the money goes to the NOCs (direct allocation from TOP programme + Olympic Solidarity funding for Athletes, coaches, NOC administrative staff), to the International Federations, to the OCOGs. The money the IOC retains is for its administrative costs which include travel expenses (IOC Session, Games Editions, Evaluation Commissions, Coordination Commissions) , support to OCOG through OGKM and Games Coordination.

Full disclosure of IOC audited financial accounts:

IOC Interim Report 2005-2006

The IOC is not asking for more money for itself but is willing to discuss the sharing of revenues between the various NOCs and IFs. In particular, at the moment USOC is the only NOC getting money from broadcasting rights whereas one might think that Australian, British, German, Chinese, French, Italian athletes (just to name a few countries) also contribute to make the Games a top sporting events.

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Since the USOC does not partake of public monies, it has every right to demand as high a cut in US sponsors and US TV rights as it can get away with. The IOC can make whatever arrrangements it wants with the other countries.

I think the USOC Olympic Channel idea will die. NBC tried it before to a certain extent. It flopped.

BTW, is Pure Facts somebody posting out of Lausanne? We used to have a poster from Paris who moved to Lausanne. I wonder if PF is one and the same.

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The IOC is currently negotiating the TV rights for the 2014 and 2016 Games here in Europe. In the past the European Broadcasting Union (EBU) has won the rights. At the beginning of the year the IOC has rejected the offer by the EBU.

The IOC wants deals with every single member of the EBU, because it expects more revenue. So, Germany is one of the biggest market here in Europe. Like France and Italy we are interested in Summer AND Winter Games.

Last week the deadline for the offers ended. Media reports, that the IOC wants 200 Mio € from Germany. The German EBU members are the public operators ARD and ZDF. They placed a bid for 90 Mio €. No other Free-TV operator made an offer.

But Germany has also a Pay-TV broadcaster. Premiere wasnt very popular and had less and less paying viewers. This summer Robert Murdoch bought Premiere. Now we have Sky (like in Italy and the UK) too. Although you really cant compare the numbers of viewers with the UK or Italy, Sky placed a bid (over 100 Mio €)!

So for the first time in German history it is possible, that we wont be able to watch Olympic Games as we are used to. There is a rule, that 200 hours have to be broadcasted in Free-TV.

The program director of ARD has already threaten, that they wont no longer show unpopular sports between the Games. Swimming, athletics or speed skating arent that popular.

If sky succeeds, the Olympic Games have one viewer less.

So, here is my question to you. How is the situation in your nation?

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/\ That's all posturing. How can the 4th sporting nation in the world have such 'lukewarm' viewing interest in the Olympics...especially if Munich is gearing for a 2018 run?

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What seems to be lost in this good USOC bad USOC and the Good IOC Bad Ioc thing is the United States overwhelmingly educates many elite athletes from across the globe with athletics Scholarships for NCAA Colleges.

I have the feeling it is not as cut and dry with a Christy Coventry or Gloria Kemasuode attending uni in the states on the uni's dime totally . I am sure the IOC probably supports these educations as well for part of their sports development programs

The Problem is what is fair . IF Peter Ueberroth did not create a new business model there would have been no LA 84 to start the march for there indeed be a billion dollars of tv rights coming out of the US? When it comes down to it if the USOC doesn't deserve this small part of rights from their own territory in the eye of anybody then really yuo are missing the point of who saved the games and have brought it to another level that enjoys the favor of US businesses as broadcasters , advertizers and sponsors.

Somehow turning over all the money to the IOC ,which could not manage to find a European country willing to save the games in the 1980s, seems a bit like shuffling the money to a bad accountant who had an incident that would not make you confident of him to think on his feet. A European nation could have done it but they did not and felt it was not important to contribute to the IOC survival.

Who are the Tops sponsors from europe? An IT provider and a Swiss timing Company . Surely those company probably provide just goods and services in kind ? 12 percent of what is generated in the largest tv market seems small if you think that if it wasnt for peter U their would be no cake to divide at all.

Jim jones

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Good point, JJ. And if anything, the seemingly 'stringent' terms that the USOC extracted from the IOC taught them to be MORE vigilant about what they should OR shouldn't sign away.

Long and the short of it: the US has given the IOC and the Olympic movement MORE than what it has taken from it -- considering they snubbed the US for 52 years!!

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I need some explanation ....

[*] ... in 1978, the US Congress granted exclusive rights of the Olympic mark (that it didn't own anyways...) to USOC who could commercialize it in exchange of an agreement for no public fundings (the IOC has nothing to do with that)

I was only 3 yo in 78... too young to get this history... so how could US Congress grant rights that they did not own ???

I know that probably before 1978, there was no marketing program.... but this deal is very strange....

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I was only 3 yo in 78... too you to get this history... so how could US Congress grant rights that they did not own ???

Well, Pure Facts may have phrased it not quite correctly. The US Congress granted the USOC full, shall we say, 'guardianship' rights to the Olympic marks (and name) as the USOC is the designated representative of the IOC to the U.S. Without that protection, the USOC wouldn't have anything to own or make money from.

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Good point, JJ. And if anything, the seemingly 'stringent' terms that the USOC extracted from the IOC taught them to be MORE vigilant about what they should OR shouldn't sign away.

Long and the short of it: the US has given the IOC and the Olympic movement MORE than what it has taken from it -- considering they snubbed the US for 52 years!!

Baron

1904-1932-1960-1980-1984-1996-2002, the largest gap is 28 years, I wouldn't complain.

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Baron

1904-1932-1960-1980-1984-1996-2002, the largest gap is 28 years, I wouldn't complain.

Well, it was 52 for the Summer Games to return. ;)

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An Olympic Games is an Olympic Games and when you give up Detroit as your choice you deserve to lose to Munich, Mexico City, Melbourne, Tokyo, Montreal and Rome.

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Well

1948 - there was no choice but London

1952 - Helsinki over LA, the much beloved Minneapolis, Detroit, Chicago, and Philadelphia. I mean over LA, little questionable but than again those Euros might not have wanted to travel too much

1956 - Melbourne over Chicago, Detroit, LA, Minneapolis, Philadelphia and San Francisco, can't complain much....

1960 - Rome over Detroit pretty obvious choice, Rome or Detroit, Rome or Detroit.....pretty easy

1964 - Tokyo over Detroit pretty obvious again, Tokyo or Detroit not a hard choice

1968 - Mexico City over Detroit, a little bit more suspect but still a capital city or an industry city

1972 - Munich over Detroit with Madrid and Montreal the race, obvious last place finisher

1976 - they finally try to step up with LA but Montreal won out over Moscow, pretty much a compromise candidate

1980 - Moscow over LA, they had to go to Russia some time

1084 - we all know what happened.

So you can't really complain that the IOC wasn't kind to the US, in 1960 they can a WOG and in 1980 they got another.

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I've never seenn it spelled out explicitely, but was it the fact that Detroit was Brundage's hometown that made them keep pushing it?

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I've never seenn it spelled out explicitely, but was it the fact that Detroit was Brundage's hometown that made them keep pushing it?

No, I think Detroit really had a hyper-active committee much the same way Madrid and Istanbul and Tulsa have one. They just wanted to bid until they got it...and they had lots of money too. (But there may be a Brundage angle too that's not quite apparent.)

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And in those days, Detroit was Boom Town. One of the 5 largest cities in North America and exploding with the growth of the auto industry. Ironically, after 1968, it started to slide downhill.

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give 2% of usoc share to africa and let usoc keep its share. dont be such colonialists.

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Good point, JJ. And if anything, the seemingly 'stringent' terms that the USOC extracted from the IOC taught them to be MORE vigilant about what they should OR shouldn't sign away.

Long and the short of it: the US has given the IOC and the Olympic movement MORE than what it has taken from it -- considering they snubbed the US for 52 years!!

Well I know you are saying 52 years in regards to La 32 to La 84 but it even goes back further then that as LA 32 was not the result of a bid election . It was again a orphaned games which would have been the second games for the longest serving sponsor of the Olympic Movement Being Atlanta's Coca Cola. America staged two Olympics in 1932 being the Winter games in Lake Placid and the summers in Los Angeles in the middle of the Great Depression and the dust bowl conditions for Us agriculture inspiring the Grapes of Wrath .

Chicago 1904 was basically an IOC decree with no Bid election . It was not until 93 year of the modern olympic movement that America was granted the summer games election despite contributing many times the financial resources that the rest of the world did to support the games.

America has bid many many more times then the rest of the World and contributed just as much in terms of multiples over the rest of the world.

Jim jones

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If you put up a city like Detroit as your candidate, you deserved to be snubbed. LOL!

Yeah like hey Detroit Automakers never did a damm thing for the IOC except donate vehicles to the running of the games IE Montreal 76 and Calgary 1988 which I know of . Hey I rode around in a Calgary Olympics Passenger Van in the early 1990s compliments of it being for Sale at the local GMC dealership post 1988 . And God I was so disappointed VW , Renault , Jaguar or Toyota wasn't providing Vans for those Games and probably for no others undoubtedly

I am sure the case is the same for GM in Regards to Vancouver 2010 and has been the same with European , Asian and Australian units of GMC when the games have come to those locations.

Yeah i guess you can be smart enough in Detroit to provide athletes mode of ground transport but hey stage the games ?

Jim jones

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I've never seenn it spelled out explicitely, but was it the fact that Detroit was Brundage's hometown that made them keep pushing it?

well the hometown angle could be there but you also consider what Detroit contributed to the World War 2 war effort and many of those bids by Detroit would have had a different feeling to them in the 1950-60s then today. I think of people like an industrialist like William Keiser around the mid west who was involved with automobiles , ships and other things supporting the defeat of the axis powers. During the 1950s especially Detroit was the centre of the industrial powerhouse names America so it would be taken seriously by the Americans but maybe with scorn by Europe for what they may not like about America excessive capitalism in some minds. No offense Roltel to Melbourne or Australia but for Australia to be awarded before modern JET age travel and before the US kind of shows the underbelly of what the IOC would think of America really. Japan was awarded its first games via election over 60 years before America was first awarded via election. That is incredible . If not for WW2 Tokyo would have staged 1940 36 years before the North American Continent had its first elected hosting in Montreal let alone Atlanta 1996.

Yes Detroit would raise the eyebrows on many people in North America today and even a couple of decades ago but to a degree all American bids including the first summer games to win for America being 1996 would raise eyebrows in Europe especially. I am sure IOC members thought Beverly Hillbillies or the Andy Griffin Show when they thought Atlanta 1996 at the start. Atlanta 1996 changed that with grand house parties for IOc members showing that they could be as regal as anything anywhere. Make them our friends was the Ticket to Atlanta's success.

The thing that has brought it around for America and North America is the money required to keep the IOC moving forward and that most of that money comes from America . Melbourne 1956 was pre the influence of big TV rights . The Tv rights only started to be a factor from LA 84 on . Until a China or EU starts to match the US rights you will see the games come to America on a much more regular basis then Pre 1984.

Jim jones

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Am reading "Rome 1960: the Olympics that Changed the World" by David Maraniss. So far so good. Just got through an early chapter about Brundage. Yes, he was from Detroit but he made his money in Chicago hotels and real estate. And he was kinda autocratic and imperious (and Samaranch learned really well), but not always got his way. So either he really wasn't keen on having Detroit host (since his personal assets were all in the CHicago area) or while the IOC membership acceded to his every wish and demand, denying Detroit the summer Olympics was their way of keeping AB in check. Just my theory.

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Baron

1904-1932-1960-1980-1984-1996-2002, the largest gap is 28 years, I wouldn't complain.

1904 - was not a vote the US was probably given the honors simply because they sent the largest teams to the first two games barring the european nations who of course were close to the host cities. Paris 1900 was a sideshow to the Worlds exposition so it was natural to have the games go to America with their outstanding participation from the beginning .

1932 - again was not a vote won bid , the new winter games and summer had to be hosted in the same country in the same year and in the case of the USOC they were the only NOC to have Winter and Summer Candidates. The Summer Candidate for 1932 was just LA so it was really an orphaned summer olympiad.

1960- finally 64 years after the first games the United States stages chosen via Bid election . This came after 32 separate bid cities from the US attempted and Failed including 5 bid attempts by Los Angeles and 3 attempts by Lake Placid in the first 64 years of the games. 50 percent of that time American softdrink giant Coca Cola was a Olympic Games Sponsor as they started to sponsor every games from 1928 on.

1980- Another US host rescues an orphaned Olympiad with time the Winter. 1976 your did forget Denver was awarded but did not host.

1984 -Another US host rescues an orphaned Summer Olympiad for the second time in the modern games history. Los Angeles by 1984 had been rejected another two times since the first US bid election victory for Squaw Valley in 1960. Lake Placid was rejected twice as well.

1996 - finally 100 years after the first modern games Atlanta is awarded in a bid election for a US summer bid. Coca Cola at the time of the election had a relationship spanning over 60 years .

McDonald's, Kodak and other American Company's had come aboard as key Worldwide partners of the Olympics because of LA84.

In the time it took for America to finally be elected . Australia, Mexico , South Korea, Canada , Finland and the Soviet Union were all elected once to host the games. Japan was elected twice to host the summer games and Paris, Berlin , London and Rome had been elected twice to host the summer games. If that does not spell a Bias towards the US then I don't know what does.

2002 the third winter bid election for the US. The gap between election awarded hostings 36 years . This was in the Era that Tv rights went from a mere 30000 dollars in the US to 550 million for Salt lake city for the US rights. Again their would be no tv rights to fight over without the intervention of the US to save Olympiads on three occasions .

Jim Jones

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