NBC Evaluates Investment in Olympic Broadcast Rights

No union of sport and media is closer than that between NBC and the Olympics. NBC has the exclusive broadcast rights for the powerful American market and a degree of influence over how the Olympic Games are organized. But that control comes with a steep price — and an increasingly uncertain payoff.

NBC paid well over $600 million for these Olympics. The games have long been a favorite for viewers and the network says more than 170 million Americans have seen the games on NBC and its sister channels. NBC Sports Chairman Dick Ebersol predicted this week the network will make more than $50 million in profits.

But Paul Swangard, managing director of the Warsaw Sports Marketing Center at the University of Oregon, says it's not clear whether the network will break even.

"When the Olympics go away, if people continue to watch NBC and they can entertain that population with other programming, then it's $600 million dollars well spent," Swangard says. "If it's another two years until they win a Nielsen week again, I think you begin to question why you spend that much money to win the Nielsen ratings once every two years."

Right now, it's hard to imagine the Olympics without NBC. The NBC money makes up more than 40 percent of the International Olympic Committee's total budget.

The NBC deal is part of a multi-billion dollar partnership that ensures it will broadcast the games through 2012. NBC's parent company, General Electric, is a global sponsor. And a senior executive from NBC Sports sits on the governing board of the International Olympic Committee.

NBC has pushed for the inclusion of edgier games in the hope of attracting younger viewers. But ratings are down sharply from the Salt Lake City and Nagano Winter Olympics.

Through a spokeswoman, NBC executives declined several requests for comment.

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