The "story of [the] historic deal" by which NBC Sports
Chair Dick Ebersol secured Olympics TV rights through 2008,
was "reconstructed through interviews with key players and
previously undisclosed documents" by Abrahamson & Harvey of
the L.A. TIMES, who wrote the story "speaks volumes about
the economic forces and personalities that drive both the
modern" Olympic movement and the "seductive dance between"
the IOC and the TV networks. The "repercussions" of the
deal "still linger, five years later," as the pact, "cut
without competitive bidding, ... ended careers at rival
networks, damaged longtime friendships and sowed allegations
that NBC sweetened the pot" with a $1M donation to the
Olympic museum near the IOC's Lausanne headquarters.
Abrahamson & Harvey wrote that "few people" knew that
Ebersol and his ABC "counterpart" Dennis Swanson were
"quietly engaged in talks aimed at a joint bid" for the
Sydney Games, when NBC Broadcasting President Randy Falco
asked Ebersol to consider bidding for the Sydney and Salt
Lake City Games simultaneously. Abrahamson & Harvey called
Falco's request "radical speech ... In the ordinary course
of business, it would be years before the TV rights to the
[Salt Lake City] Games would be up for consideration." But
NBC execs were "betting that their" $1.25B bid for both
games "would preempt all others." While IOC President Juan
Antonio Samaranch and VP Dick Pound agreed to accept the
bid, a "sticking point emerged: how to divide" the $1.25B
"lump sum" between Sydney and Salt Lake City. Qantas Chair
Gary Pemberton, who then headed the Sydney organizing
committee, "knowing that" News Corp. Chair Rupert Murdoch
was "rumored to be offering" $700M for Fox to get U.S. TV
rights to the 2000 Summer Games, "asked for, and got,"
$705M. Meanwhile, former SLOC bid exec Tom Welch "quickly
settled" for $545M, as SLOC had been "expecting only" $400M.
After the "delirious celebrations died down" at NBC, Ebersol
phoned Samaranch to discuss securing TV rights for future
Games, and "after a few weeks of back and forth and
meetings, NBC settled on an offer" of $2.245B for the 2004,
2006 and 2008 Games. Abrahamson & Harvey wrote that the
"second of the deals contains a little-known insurance
policy: The IOC gets half the profits after [NBC's]
advertising sales exceed the cost of buying the rights and
producing the broadcast. That is likely to mean millions
more dollars." Pound: "When you have the chance to acquire
certainty on a short-term basis and then certainty plus an
upside on a longer-term basis ... I didn't think that was
rocket science" (L.A. TIMES, 8/13).
