According to the contract sending the '28 Games to L.A., the IOC’s contributions will total $1.8B, about 33% of the current $5.3B budget. That is only 6% more than Paris will receive to host the ’24 Games. The figure is mostly broadcast and sponsorship revenue. However, the contract notes that the L.A. share of IOC global sponsorship revenue could grow by $200M due to “potential renegotiations or renewals of current agreements covering key product categories” after the contract is signed. The IOC already is bullish about its prospects in the global TOP sponsorship program, and most marketing experts believe the locked-in promise of a Games in the U.S. would be a major bargaining chip in future negotiations. As an example, LA '28 Chair Casey Wasserman mentioned the mobility category, in which Toyota currently has global rights through ’24. Presuming the IOC signs an extension or a replacement to Toyota through ’24, LA ’28 would benefit in increased value.
Separately, the contract revisions set an eight-year time frame for the joint venture that would be created by the USOC and LA ’28 to combine all Team USA and L.A.-specific marketing rights. It will begin Jan. 1, 2021, and extend through the end of '28. However, there was no other word yesterday on progress on that document, which the USOC and L.A. leaders must negotiate separately before the September vote. The two bodies quickly came to terms for a joint venture around ’24 last year, but waiting until ’28 presents new wrinkles to the JV -- such as how revenue would be shared, and how the extended selling period would effect USOC revenue and strategy. Usually, the rights are combined for six years.
