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NBC TAKES A DOUBLE DIP -- LOCKS UP SALT LAKE, SYDNEY RIGHTS
Published August 8, 1995
NBC was awarded the rights for both the 2000 Summer Games in Sydney and the 2002 Winter Games in Salt Lake yesterday in a combined deal worth $1.27B. Under the agreement, NBC will pay $705M to broadcast the Sydney Games and $545M for the Salt Lake Games, using both its flagship network and cable channels CNBC and America's Talking in broadcasting the Games. The network will also give each city's Olympic Organizing Committee $10M in promotional considerations and will broadcast a weekly show about the Olympics, starting the week after the Atlanta Games next year until the Salt Lake Games (NBC). ABC and NBC had been discussing the possibility of a joint deal for the Sydney games, which were expected to be opened for bidding next month, but "those talks fell apart last week," according to this morning's WALL STREET JOURNAL. Goldman and Simmons report that Disney's acquisition of ABC "just complicated the issue" (WALL STREET JOURNAL, 8/8). ABC's Mark Mandell confirmed with the L.A. TIMES last night that both parties had discussed a deal. NBC's bid surpassed the record for Summer Games rights fees by $249M, and surpassed the Winter record by $170M (L.A. TIMES). THE STORY: NBC officials reportedly put together the bid last week and gave the IOC until Sunday to accept the deal. As part of the negotiations, NBC insisted that their offer was final, had to be kept confidential, and told the IOC they must "take it or leave it" by Sunday. Steve Nidetz reports that IOC officials "saw little choice but to accept NBC's offer." IOC negotiator Dick Pound: "This was a pre-emptive bid on the part of NBC. We did not anticipate an offer of this magnitude." IOC officials told the other networks of NBC's coup Monday morning. Most in the industry had anticipated bidding for Sydney to begin in September, and for Salt Lake in '97. Pound: "This is kind of an ad-hoc process, nothing is cast in stone" (CHICAGO TRIBUNE, 8/8). NBC officials met with IOC members last week for the first time "triggering days of number-crunching and globe spanning airline flights by network executives," before yesterday's deal announcement, Richard Huff reports (N.Y. DAILY NEWS, 8/8). NBC Sports President Dick Ebersol: "We believe in sports and we fancy ourself as the Olympic network in the United States. ... We went after these things because this is what we believe in as the boiler plate of NBC's success. This is not a reaction to other deals. This is what we do" ("Sports View," CNBC). WHAT ABOUT RUPERT? Fox's Rupert Murdoch, a native Australian, was known to be interested in broadcasting the Sydney Games. Sources say Murdoch was willing to bid $701M for Sydney, according to Richard Huff. However, Huff notes the IOC's "unwillingness to deal with Murdoch ... led to the deal with NBC." (DAILY NEWS, 8/8). WHY TWO? WHY NOW? In this morning's WALL STREET JOURNAL, Goldman and Simmons write that NBC's "pre-emptive strike" sends "a strong signal that the network still wants to play in the big leagues in the wake of last week's" mega-media deals. Goldman and Simmons add NBC was nervous that Fox "would make a strong bid ... And now, with Disney's deep pockets behind ABC and ESPN ... NBC decided it had to make a surgical strike to keep the Olympics in house" (WALL STREET JOURNAL, 8/8). In this morning's CHICAGO TRIBUNE, Steve Nidetz writes that NBC President/CEO Robert Wright "said the quickly arranged offer was, in large part, a reaction to the telecommunications deregulation passed last week by Congress." Wright: "We see a U.S. market that's going to gravitate toward pay television. The congressional bill that was just passed is an example of that . It's all about pay television" (CHICAGO TRIBUNE, 8/8). The L.A. TIMES' Larry Stewart called the deal "a stunning move," and writes that "it may have been prompted by the Disney-Cap Cities merger. ... Now Disney is out of the Olympic picture, at least through 2002" (L.A. TIMES, 8/8).