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With Walt Disney Co. announcing it was buying Capital Cities/ABC and Westinghouse reaching an agreement to buy CBS, NBC last week decided to grab its own share of the headlines. In a preemptive move, NBC agreed to pay an impressive $1.27 billion for U.S. broadcast rights to the 2000 and 2002 Olympic games.

The Olympics deal presents a unique opportunity for NBC, which believes in the future of both broadcast network and cable network TV, as well as all other video-into-the-home programming.

The Olympics investment first of all adds another major event to NBC's dominance in free over-the-air TV; NBC President Bob Wright fears more and more of these big events will slip away to pay TV.

Secondly, the Olympics rights will aid its two cable TV units-CNBC and America's Talking-without impinging on the broadcast net, which can carry only several hundred of the thousands of Olympic hours.

NBC flopped with its innovative yet poorly executed TripleCast pay-per-view event during the 1990 Olympic coverage. But now the Olympics committees made it a prerequisite of both the Sydney (2000) and Salt Lake City (2002) bids that they included "multichannel options" to make available as much of the Olympic experience as possible.

And that requirement may be NBC's trump card. With the clout of these cable TV rights, NBC hopes to leverage its new America's Talking net into more cable TV systems, adding appreciably to the number of homes getting CNBC and AT coverage by the time the Olympics roll around.

Moreover, advertising revenue from the cable nets will likely be an essential element in amortizing the costs of the Olympics. For NBC to make money from broadcast ad income alone, it would have to price its ad minutes in the million-dollar range. But the CNBC and AT cable nets will help moderate those costs and enable NBC to offer attractive "package" pricing.

With a growing array of media and non-media venues where marketers can spend their money, all the networks and their new owners know they'll have to offer innovative programming and packaging to prosper. NBC's Olympics deal fills that bill.

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