Olympics on NBC

With all the excitement and hype surrounding the Vancouver Olympics, I’ve been wondering about all the PR that goes into the Olympics. I found an interesting article here about NBC and their investment in the Olympics. I believe their investment was very risky. NBC took an enormous gamble in investing as much money as they did, years before the event: “In 1995, when NBC spent $2.3 billion for TV rights to the 2004, 2006 and 2008 Games, it was the biggest sports-rights deal in history. The network followed in 2003 with $2 billion for 2010 and 2012. Fox Sports bid $1.3 billion; ESPN/ABC proposed a revenue-sharing arrangement with the International Olympic Committee.”

The downturn of the economy has made NBC very vulnerable to loss. According to the article, NBC paid $820 million for the rights to own the broadcasting, but NBC and corporate parent General Electric could lose as much as $250 million. NBC certainly wasn’t expecting the recession when making such an investment; however, their coverage will definitely help NBC’s prime time shows like the “Today Show.” The article says NBC received an average of $400,000-$575,000 per 30-second spot for primetime Olympics telecasts. I don’t think this will be enough to cover the high rights fee but these rights definitely helped dwindle the late-night show (Leno vs. Conan) controversy. But what is next? The article points out that the Summer Olympics in 2012 (which NBC has rights to as well) is not as likely to be as profitable because of time zone differences for viewing (this was a big problem when the Olympics were in Athens and Sydney) and the anticipation of increased fees.

So what does NBC need to do to keep people watching AFTER the Olympics? Although the Olympics were “a cleansing moment” for NBC,  the late-night shows created such a stir that they need to figure out something positive to bring the viewers back. I think NBC handled the situation very poorly. I’m a fan of both Leno and Conan, but I think NBC should have given Conan more than 7 months to see how the show would go. I agree with Conan that NBC giving him a “Tonight Show” spot 30 minutes later simply would not be the same. What do you think? Does NBC have a chance to bounce back after the Olympics?

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3 Responses to Olympics on NBC

  1. Not a coincidence his shows this week feature the US team stars.

  2. Thank you for this interesting blog post and the link to the article about NBC’s Olympics coverage deals. When I think about PR issues and ramifications surrounding the Olympics, I first think of PR for the host nation, competing countries, sports, athletes and, particularly, the companies partnering with the U.S. Olympic team and the companies’ featured products. Positive feelings are undoubtedly generated by massive corporations like Visa, McDonalds and AT&T as they support the Olympians. So, it was refreshing, in reading your post, to think about the PR implications of NBC as it covered and broadcast the Olympics.

    While the Olympics have an exorbitant financial cost for NBC that may only be partly compensated for by the spike in advertising dollars, ratings and the ability to market its current and new shows to Olympics viewers, being the “official carrier” of the Olympics for the U.S. generates a great deal of positive feelings and good PR for NBC. Just like the sponsoring corporations can benefit by being associated with the Olympics, the connection between NBC and the Olympics, the latter of which nearly everybody seems to view positively and with warm feelings, will benefit NBC. Even the temporary makeover of its Web site, http://www.nbc.com, to feature a Winter Olympics theme, boosts stakeholders’ perception of NBC.

    It’s also a good point that the Olympics have taken everyone’s minds off of the late night controversy when they think of NBC. Instead, they’ll think about the Olympics when they think of NBC. Certainly the recent late night battles have not been good PR for NBC, because the flop of Leno’s new primetime show and Conan’s “demotion” and departure showed mismanagement and poor foresight by NBC. Fans who used to enjoy the comedy of both Leno and Conan were then forced to choose and take sides, and splitting fans (key stakeholders for NBC) that way is a bad idea.

    On a final note, as the Olympics wrap up with tonight’s closing ceremonies, I found a particularly interesting article by the Business Insider, called “The 10 Worst Winter Olympics PR Disasters Of All Time.” The article and accompanying slideshow chronicle some cases of cheating, substance abuse, sabotage, bribery and drama in Winter Olympics Games of yore. Check it out at http://www.businessinsider.com/the-10-worst-pr-scandals-of-the-winter-olympics-2010-2

    Comment by Carleen McGillick on behalf of CLPCommunications

  3. rnettleship says:

    I think that eventually NBC will bounce back, but right now they are just in the dark days. NBC did not handle the Conan situation they way they should have, and now they just have to hope that Leno bounces back and gets great ratings.

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