SBJ/20100726/This Week's News

IOC could go it alone on U.S. rights deal

The International Olympic Committee still has not decided if it will hire a media adviser to assist it when it sells the U.S. media rights to the 2014 and 2016 Olympics, IOC executive Timo Lumme said during a recent trip to New York.

If it winds up hiring an adviser, the position would represent a coup for any individual or agency, providing both a substantial commission and the prestige of being associated with one of the most anticipated rights agreements of the year.

While no timetable has been set on when the IOC goes to market, if it decides to sell the rights on its own, it would mark the first time in recent memory that the committee has managed the bid process independently in the United States.

Seven years ago, the IOC hired media consultant Neal Pilson to assist it with the sale of rights for the 2010 and 2012 Olympics. NBC bought those rights for $2 billion.

Last year, the IOC hired CAA’s Evolution Media Advisors to evaluate the U.S. media market and how it had changed and evolved since 2003. The project was research based and has been largely completed, Lumme said.

IMG and Wasserman Media Group also could be considered for the role, as would Pilson, who has been involved in IOC media deals dating to 1984. In an interview earlier this year, Pilson said that he approached CAA to gauge their interest in teaming up, but did not receive much initial interest.

“The Olympic negotiation this time is going to be far more complex than it was last time,” Pilson said at the time. “In 2003, we basically talked about television and, to a lesser extent, Internet rights, broadband and cable distribution. The world has changed dramatically in the past five or six years.”

Still the IOC could decide to forgo hiring an adviser and sell the rights on its own. The committee historically has worked with the Los Angeles-based law firm O’Melveny & Myers on its international TV rights. The firm, which has worked with the IOC since 1984, recently led the IOC’s media negotiations in China, where it landed a $100 million rights agreement with China Central Television for the 2010 and 2012 Olympics. That fee represented more than a 400 percent increase from the previous deal.

Sources say the IOC’s decision about outside consultation could offer a window to how the committee is leaning. A decision to work on its own could be interpreted as a sign that NBC is a front-runner and the committee simply wants to renew the deal. A decision to hire an outside agency could be taken as a sign that it wants to set up an auction of interested bidders, like ESPN, Fox and CBS/Turner.

Assisting the IOC with its bid would be big business for any agency or independent adviser. The organization expects to fetch more than $2 billion for its rights, but it’s not known how much of a percentage an adviser would take in any deal.

The IOC bidding process will be led by IOC executive board member Richard Carrión, who will have the final say on how the process works and who will be involved in it. The organization remains undecided about when it will open the bidding process. The organization’s leaders plan to wait until global economic conditions have stabilized and the pending Comcast-NBC merger has received government approval. That likely would push the bidding process into the first or second quarter of 2011.

“We want to wait for the right time,” Lumme said. “The market will speak to that. For right now, we’ll wait.”

NBC and ESPN have both held discussions with the IOC about bidding for the rights. Fox Sports Chairman and CEO David Hill has publicly expressed an interest, and CBS and Turner Sports have discussed the possibility of a joint bid.

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