Posted by: euromediablog | July 30, 2009

Olympic Games for Sale

This could be a new milestone in the history of olympic broadcasting: On this tuesday IOC rejected EBU’s bid for the transmission rights of the olympic games in 2014 and 2016.This comes as some surprise because since 1956 common european rigths-contracts between IOC and EBU seemed to be the rule. Why?

The European Broadcasting Union represents 75 national broadcasters in and around Europe in the negotiations with the IOC and could as such enjoy stronger influence on the price for the olympic games. It was often accused of cartel practices by the Competition Directorate of the  European Commission, but still it always managed to defend the common interests of the European free-to-air broadcasters on the tough sports rights market.

IOC on the other side preferred to handle with EBU because the union could guarantee the  largest possible audience for the olympic games and complete coverage of the sport events between the olypmic cycles, inclusive paraolympics. As long as olympic games were regarded as a global event of enormous social and political importance- this was also the most reasonable decision.

After tuesday’s rejection this status quo seems to be in danger. Sports rights have gradually turned into a precious globally convertrable economic good with a possibility for lucrative revenues. The olympic games do not seem to make the exception- for the next two Games periods of 2010 and 2012 IOC expects to get close to $4 billion from broadcastin rights.

The fiercer the competition- the larger the revenues.

In this spirit IOC  is this time planning to auction the olympic broadcasting rights nationally and thus get a larger revenue in Europe  ($ 200 million more)- than from EBU’s general offer. The implementation of this market logic could however be pretty risky in the times of advertising crisis and economic unsecurity of the commercial broadcasters. Till now only pay-tv providers (SKY Britain,Italy and Germany and CANAL+ France) have expressed their interest in acquiring the broadcasting rights- a tendency that can lead to an eventual exclusion of a large part of the European audience. And the olympic games are still an event of significant social importance that can be easily included in national lists of free public access and thus be politically “moved” to free-to-air broadcasters  (EU AVMS 2007).

IOC should consider this strong non-economic argument in its future European broadcasting rights poker…

For further Information: FAZ (30.07.2009) and worldsportslawblog

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