The new linear Olympic Channel has secured a distribution deal with DirecTV, but still faces negotiations with Comcast and other major distributors as it prepares to go live next summer. Announcing the channel’s creation today, NBC, IOC and USOC officials all said they do not expect the new channel to turn a profit, rather seeing it as a way to promote their $8B partnership around the Olympics themselves. Notably, NBCU parent Comcast has not, as of this moment, agreed to include the channel in its lineup, NBC Olympics President Gary Zenkel said. “When (planned negotiations) begin, the Olympic Channel will certainly be part of that discussion,” he said. Officials would not give a target number of households to reach. However, one sports cable industry expert suspected it could reach 30 million by the '18 PyeongChang Games, presuming Comcast comes to terms and DirecTV parent AT&T’s proposed merger with Time Warner goes through. Profitability is not a goal, but nevertheless, the launch of a new sports-only cable channel comes in a challenging environment. Subscription counts are shrinking even for even stalwarts like ESPN as more consumers abandon or limit cable. Ratings for the Rio Games this year also were down from the '12 London Games, but NBC still posted a $250M profit. A previous iteration of an Olympic sports specialty channel, Universal Sports Network, which NBC partially owned, went off the air in '15. But NBC and Olympic officials said they were confident in this new experiment. “We are confident that given the vast interest in the Olympics ... that the distributors, who all of course embrace the Olympic Games, and of course the audience that embraces the Olympic Games, will embrace this opportunity to distribute this platform as well as watch it,” Zenkel said.
A MOVE FOR THE FUTURE: The linear channel will only be available for streaming for authenticated cable customers, and will not be made available through Apple TV, Roku or other smart TV setups. For programming, the new channel will primarily serve as a home for the large stable of Olympic sport rights acquired by NBC Sports after the dissolution of Universal Sports. NBC acquired far more events than it can squeeze into its schedule on NBC and NBCSN, and for now, that extra inventory is limited to streaming on NBCSports.com and its mobile app. One unanswered question is whether NBC will steer high-demand events to the new channel in hopes of building interest. NGBs cheered today's news. The old Universal Sports Network reached far fewer than 10 million households, so this appears poised to far exceed that. U.S. Ski & Snowboard Association CMO Mike Jaquet in a statement called the channel “yet another opportunity to provide more value to our fans by connecting them with a new media outlet to showcase our athletes.” It will also use content being created by the IOC, a digital/social property launched in August. For example, the Spain-based channel commissioned a high-end documentary series, "Five Rings Films," produced by Frank Marshall and Mandalay Sports Media.
PROTECTING SPONSORS: Advertising on the channel will be limited to existing IOC and USOC sponsors, IOC Managing Dir of TV & Marketing Timo Lumme said, except for inventory during certain world championships to allow advertising for those events’ own sponsors. IOC TOP sponsors Bridgestone and Toyota are the only companies to have made a public commitment to the Olympic Channel so far. “We’re in active discussions with a number of our domestic sponsors,” said USOC CMO Lisa Baird. The channel is a joint venture of NBC, the USOC and IOC, though parties would not elaborate on the terms. But the bottom line is not the point. USOC CEO Scott Blackmun said. “We’re definitely looking at it holistically. We’re trying to grow the number of kids that are actively participating in sports, we’re trying to develop a fan base, we’re trying to provide a great platform for our sponsors. ... We’re not looking at this to justify itself."
