Abstract:

This paper discusses the process involved in a network's acquiring the rights to telecast the Olympics and examines the role research played in NBC's decision to acquire the 1992 Summer Olympics in Barcelona. The paper will provide a brief historical perspective of telecasting the Olympics, including the nature of the coverage, the amount of air time, the audience attraction and the "rights fees". Research is intimately involved in the decision- making process which starts with estimating Olympics rating performance four years in advance of the events. What factors go into these estimates? Why are they important? Networks and advertisers pay a premium for these events. How can this be justified? Over time, the cost of acquiring the rights to telecast the Olympics increased dramatically. There was more need to examine critically the value of the Olympics for the network managements and the advertisers. This paper also reports on the research studies conducted by NBC designed to deal with the answers to these questions. The Olympics have become one of the premiere advertising and merchandising events of the 20th century. This paper will examine how a U.S. television network prepares for the Olympics. I will discuss from a historical perspective the ratings of the Olympics, how much the networks paid for their rights, the factors that go into the decision to acquire rights, the nature of the coverage and the audience performance. I will also examine the role research plays in this process and then review two studies conducted by NBC Research. One was designed to make the coverage more appealing to viewers and the other to help advertisers assess the value of the Olympics as an advertising and promotion vehicle.