SBD/Issue 234/Olympics

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  • Economic Downturn Contributes To Budget Shortfall For VANOC

    Key components in the plans for the '10 Vancouver Olympics are "slowly coming undone because of a worldwide recession seen as the worst economic slump since the Second World War," according to Stephanie Levitz of the CP. At a time when the focus "should be on the final few details, a multi-million dollar budget shortfall is fraying the close ties that bind" VANOC and IOC officials. The IOC Coordination Commission "makes its final trip to Vancouver this week and will review transportation, accommodation, venue arrangements and plans for the opening and closing ceremonies, among other things." But plans in "some of those areas can't be finalized because of an issue that's become a key point of contention between the IOC and Vancouver organizers" -- $30M (all figures Canadian) "worth of sponsorship money." VANOC "has repeatedly claimed it's owed a further [$30M] from the IOC's take from major international sponsors," but the IOC disagrees.

    IOC Could Give VANOC Greater Share
    Of Broadcast Revenues To Help Bridge Gap
    SPONSOR SHORTFALL: VANOC officials developed their '09 budget "on the assumption the IOC would be able to sign 11 international sponsors and give them" $196M toward their $1.75B bottom line, but the IOC has signed only nine TOP sponsors, the "lowest number since the worldwide program was started." VANOC VP/Communications Renee Smith-Valade: "We were making budget forecasts that were based on a buoyant economy, on ongoing discussions with the IOC, on the performance in Beijing as it related to sponsors. We prepared our updated budget and then of course everything changed, the economy took a dive and everyone had to reanalyze and reassess every assumption." IOC member and VANOC BOD member Dick Pound: "The key is not whether $30[M] comes from two phantom (worldwide) sponsorships, but how you fill that hole. There are lots of ways the IOC could do that." Levitz noted options "could include the IOC giving VANOC a greater share of broadcast revenues for the Games or handing over more of their commission on sponsorship," and there are "other ways as well." Hockey Canada's jerseys for the '10 Games feature a "sleeve patch with the Vancouver Games logo," which will "boost the revenues VANOC makes from merchandise sales." Meanwhile, IOC Coordination Committee Chair Rene Fasel said that he "still believes VANOC will be able to deliver the services required to put on the Games." Fasel: "There hasn't been any change in my expectation for these Games because I remain confident that Vancouver will put on top notch Olympic Winter Games" (CP, 8/23).

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  • Hockey Canada Agrees To Cover Insurance Needs For 46 Players

     
    Hockey Canada Friday announced that it "will cover the insurance needs" for all 46 players attending its on-ice Olympic orientation camp at the Saddledome that runs from today through Thursday, according to Allan Maki of the GLOBE & MAIL. That means "each player will be financially protected" for the '10 Vancouver Games, "as well as for the length of his current NHL contract." The decision to "protect the players and their contracts became necessary last month" when the NHLPA "recommended its members skip the on-ice portion of the Olympic camps for fear they could suffer an injury and jeopardize their careers." NHL teams "do not cover players during the Olympics and the NHLPA wasn't happy with the limited insurance provided by the various" national hockey organizations. Hockey Canada President Bob Nicholson "didn't say how much the insurance coverage is costing Hockey Canada and admitted he was hoping 'someone else would up and partner.'" Proceeds from a "gala dinner and Olympic team's Red versus White scrimmage, set for Thursday, will help defray the costs" (GLOBE & MAIL, 8/22). In Edmonton, Jim Matheson wrote the 46 players have about $875M "left on their NHL contracts, which means Hockey Canada has stepped up big-time." Hockey Canada "won't say how much the insurance premium is, but it probably runs well into seven figures" (EDMONTON JOURNAL, 8/22). In Toronto, Steve MacFarlane noted many of the NHL's "highest-paid players were taking out personal insurance to bridge the gap beyond this season in the event of any long-term injury sustained on the ice" during the four-day camp (TORONTO SUN, 8/23).

    RING TOSS: In Boston, Kevin Paul Dupont wrote the NHL "feels it loses marketing momentum and its place in a very crowded professional sports marketplace with the two-week hiatus" for the Olympics. Maple Leafs President & GM Brian Burke, who is also serving as GM of the U.S. Olympic team, said, "There is no other business in the world that shuts their doors for 2 1/2 weeks in the middle of the season. I mean, we have gotten very little benefit from this tournament when it is not in North America. ... I wouldn't be surprised if this is the last Olympics that NHL players participate in." But NHLPA Exec Dir Paul Kelly said, "The players overwhelmingly support continued participation in the Olympics, regardless of issues about time zones, locations, and whether it is in Russia or someplace else." Kelly: "I think the league is going to wait and see what kind of experience we have in Vancouver, what kind of buzz is created around the sport. If you have a tremendous tournament, a great gold medal game, if your (TV) ratings are off the chart, if you create an international buzz about the sport, then I think it changes the dialogue. I think the NHL has to take a fresh look at this question" (BOSTON GLOBE, 8/23).

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