Broadcast Rights, a Vein of Gold — How Television Changed the Olympics

In the previous episode, we watched the 1984 Los Angeles Games strike two veins of gold — sponsorship and broadcast rights — and turn a dying Olympics into a profit. Among them, broadcast rights would keep swelling on their own thereafter, until they came to hold power enough to sway the very shape of the festival that is the Olympics.

Television was the agent that delivered the Olympics to living rooms around the world. But it did not stop at merely carrying them. The vast money paid as the price for riding the airwaves came, at some point, to exert influence even on the content of the competition itself. What we gaze upon in this episode is the structure, mingling light and shadow, in which broadcasting comes to dominate the Olympics.

From millions to billions of dollars

First, let us confirm with what momentum broadcast rights fees swelled.

The broadcast rights fees American networks paid for the Summer Olympics are reported to have been on the order of four million dollars at the 1968 Mexico City Games, around ten-some million at the 1972 Munich Games, and about twenty-five million at the 1976 Montreal Games. At the 1984 Los Angeles Games it exceeded two hundred million dollars, and at the 2008 Beijing Games it is said to have reached nearly nine hundred million. Over half a century, several orders of magnitude were added.

This explosive growth means that the Olympics were an extremely attractive program for television. The world’s highest level of competition, stories of emotion, athletes carrying their nations on their backs — the few weeks packed with elements that draw viewers were a golden egg for networks selling advertising. That is precisely why networks came, year by year, to pay an ever-higher price for the right to broadcast exclusively, outmaneuvering their rivals.

The presence of the American market was particularly large. The proportion of broadcast rights fees borne by American networks was high, said to be a scale that outstripped the combined sum of the rest of the world. The contents of the Olympic purse came to be greatly swayed by television conditions on the far side of the Pacific — that was the structure that, at some point, took shape.

The largest pillar supporting the IOC

Where, then, did the swollen broadcast rights fees flow? Most of them became a pillar of income for the International Olympic Committee (IOC), which oversees the Olympics.

The IOC’s income is said to rest on two main pillars: broadcast rights fees and the international sponsorship system. Among them, broadcast rights fees were long the largest source of income, and over a recent four-year span (one Olympic cycle), the combined income from broadcasting and international sponsorship is reported to reach the scale of several billion dollars.

What is worth noting is how it is used. The IOC explains that it does not pocket the bulk of the income it gains, but distributes it to host-city organizing committees, the national Olympic committees, and the international federations of each sport. Only a small part is said to go toward its own operating costs, with the remainder turned over to maintaining the Olympic movement as a whole and to promoting sport across the world — that is the mechanism the IOC sets forth.

That said, there is debate over the structure of this distribution. Voices are sometimes reported asking whether there is a gap between the proportions held aloft and the proportions actually reaching each organization. Whether the vast money truly circulates correctly — that transparency has remained one of the ongoing points of contention around the Olympics. Without praising or denouncing, we want to hold in view both sides of the fact that ‘vast money moves, and its uses continue to be questioned.‘

Start times set to suit viewers, not athletes

When broadcast rights fees grow this vast, the intentions of those paying the money come to reach the operation of the competition itself. The symbol of this is an episode over the start times of events.

At the 2008 Beijing Games, part of the swimming finals were held in the local morning. By rule, swimming customarily holds preliminaries in the morning and finals in the evening. That it was deliberately rearranged into morning finals was reported to be a consideration for airing it ‘live’ in prime time in the United States. Given the time difference between Beijing and the U.S. East Coast, the local morning falls in the prime evening hours of the previous night in America. Placing the most attention-grabbing finals in the hours when the most viewers gather — that judgment took priority over the athletes’ condition.

This decision stirred up a swirl of pros and cons. From sports bodies and some athletes, voices of pushback are said to have risen, arguing that the athletes’ physical condition should come first. On the other hand, there was the view that live broadcasting generates a large audience and income, which, going around and around, supports the competition as a whole. There is reason in both arguments.

A similar dynamic is said to reach even the number of events and the way the schedule is arranged. Whether it looks good on broadcast, whether it can draw viewers — such perspectives are pointed out to cast a shadow over the selection of new sports added to the Olympics and over the judgment of which hours the finals are placed in. The value of the competition itself, and the value on broadcast. These two, which by rights should be separate things, become bound together through vast money. Of course, the side where television cast light on new sports and brought world attention to once-unknown athletes is also large. The power of broadcasting does not only take away; it also gives.

Broadcasting is the Olympics’ greatest supporter, and at the same time its greatest dominator. Without television, the Olympics would never have spread across the world on this scale, nor would the movement have been supported by income of this magnitude. In that sense, television did indeed raise the Olympics. And yet, when the one who raised it takes the initiative, the center of gravity of the festival shifts, ever so slightly, from the arena to the broadcast booth.

From millions to billions of dollars. This half-century story of numbers is also a history in which the Olympics were kept alive by ‘being seen’ and, at the same time, changed by ‘being made to be shown.’ And the paths by which money flows into the Olympics were not broadcast rights alone. What we pursue next is the other vein of gold — the story of how the world’s renowned companies found value in the Olympic mark itself and began to move across borders.