Sports Television: Heat is on for NBC Olympics broadcast

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There's more green than gold at stake in the Winter Olympic Games. General Electric Co.'s NBC, which suffered loads of make-goods following low ratings for Sydney's 2000 Summer Games, is under enormous pressure to deliver strong ratings for the Salt Lake City games, held Feb. 8-24. The stakes are huge for global sponsors such as McDonald's Corp. and Visa International, which paid an estimated $100 million apiece for 2000 to 2004 Olympic global marketing rights-not including advertising and promotional spending.

"This is going to be interesting," said a media buyer who asked not to be named. "We've bought a lot of time, and now you start the nail-biting."

Potential for a hard sell

If ratings falter despite the immense amount of live coverage-over 50% of prime-time events will be live for 10 nights except on the West Coast-and the surge of patriotism after Sept. 11, advertisers may begin to question the value of buying time on the Olympics. That would leave NBC with a hard sell for the 2004 Athens, 2006 Turin, Italy, and 2008 Beijing games.

Sears, Roebuck & Co. took a pass on buying Olympics broadcast time this year, despite being an OPUS (Olympic Properties of the U.S.) supplier for up to $20 million. "We just don't buy a lot of media time in February and to do that at a premium seemed off strategy," said John Lebbad, director event marketing and sales promotion at Sears.

Others, such as Visa and McDonald's, bought Olympic rights and are buying significant time on NBC, which with new campaigns can easily double what they pay the Olympics for marketing rights. "It becomes basically bigger than the Super Bowl," said Tom McGovern, director of sports marketing at Omnicom Group's OMD USA, which buys time for Visa. "It becomes a month-long marketing calendar."

For Salt Lake, it appears NBC took a conservative estimate in prime-time household ratings guaranteed to advertisers. Media executives said NBC projects a 17.8 household rating but guarantees a 16.9, which would translate into 17.9 million households. That would be slightly higher than the `98 Winter Games on CBS from Nagano, Japan, which posted a 16.3. An NBC spokesman declined to comment.

Sydney's average rating of 13.8 was a major blow to NBC. The last Olympics with significant live coverage-the 1996 Summer Games in Atlanta-brought a 21.6.

"We've revised our ratings predictions," said OMD's Mr. McGovern. "We think [NBC] will overdeliver" on the projected guarantee of 16.9. But an executive at another media agency that bought time expects ratings to fall below NBC's guarantees, forecasting a 16 rating for opening ceremonies and a 15 for the remainder of prime-time coverage.

Considering the Salt Lake Games take place in the midst of a sputtering economy and are only three years removed from a major bribery scandal that threatened to turn off advertisers, NBC has done an impressive sales job. The network last week said it has reached 97% of its $720 million sales goal.

range of advertisers

Olympic advertisers come from a range of categories, from struggling Delta Air Lines to TMP Worldwide's Monster.com. Also present will be several drug companies with direct-to-consumer ads for Rx drugs. Pfizer will promote cholesterol-lowering Lipitor, possibly in spots using ex-skating champ Peggy Fleming, although it may opt to run an existing campaign, according to people familiar with the situation.

Perennial Olympic sponsors General Motors Corp. and Coca-Cola Co. will run special promotions each evening. GM will sponsor features called the "Chevrolet Olympic Moments." Coca-Cola will run a nightly music video to the pop group American Hi-Fi's "Another Perfect Day," with an international feel of memorable images from the competition and flags from a variety of countries, according to people close to the matter. It may also have another nightly feature with an Olympic theme.

With the Winter Games, NBC has the huge advantage of offering the popular figure-skating competition live in prime time; that's a good way to reach women, who make many household buying decisions. "Figure skating is the crown jewel of any Winter Olympics," said David Neal, exec VP, NBC Olympics. "It certainly has an appeal to all demographics, but particularly women."

contributing: alice z. cuneo

Fast Facts

Event: 2002 Winter Olympics

Venue: Salt Lake City

Dates: Feb. 8-24

Networks: NBC, CNBC, MSNBC

NBC sales goal: $720 million

Pct. of time sold: 97%

NBC ratings guarantee: 16.9

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