NBC Eyes Tough Olympic Run

NBC has been counting on the Summer Olympics to put its ratings on steroids.

But now that a handful of U.S. athletes have been accused of using performance-enhancing drugs -- the latest in a string of problems besetting the games in Athens -- it’s far from clear how the General Electric Co.-owned network will finish.

“NBC has a real challenge on its hands,” said David M. Carter, a Los Angeles-based sports marketing consultant. “The run-up to the Olympics so far has been negative: the lack of preparation in Athens, problems with security, the threat of terrorism and now the U.S. track team is bogged down in this steroids scandal.”

That drug controversy has raised thorny questions about how NBC will handle coverage of one of the most recognized U.S. athletes, sprinter Marion Jones.

Jones, who won five medals during the 2000 Summer Olympics in Sydney, has denied using any performance-enhancing drugs, but she remains under investigation by the U.S. Anti-Doping Agency. Jones is still widely expected to run in Athens.

Sports marketing experts say NBC will face a delicate balancing act as it covers Jones and her events.

Advertisers are wary of being identified too closely with athletes that carry even a whiff of controversy. But NBC will have to devote on-air time to a scandal that centers on Bay Area Laboratory Co-Operative, a Burlingame, Calif.-based supplement company that allegedly doled out banned substances.

“People tune into sports to avoid these things, the bad front-page news,” Carter said. “How NBC handles all these challenges is going to determine how much money they make.”

NBC’s sales of commercial time during the Olympics have been slow recently, and the network still has nearly 10% of its advertising inventory left with just a month to go before the games begin Aug. 13. That’s not all that unusual, industry experts said.

In all, the network hopes to bring in $1 billion in ad revenue. Prime-time spots on NBC have averaged about $740,000 for 30 seconds.

Advertisers are not staying away because of terrorism threats or doping, but “sticker-price shock,” one ad executive said.

The network is planning an unprecedented 1,200 hours of coverage on six outlets, including Spanish-language Telemundo and cable channels MSNBC, CNBC, Bravo and USA Network. In contrast, NBC carried about 440 hours from Sydney.

Even with higher security costs, network executives say the games could bring in more than the estimated $75-million profit from the 2002 Winter Games in Salt Lake City. NBC paid $793 million to broadcast the games from Athens.

“We’ll make a significant profit,” Dick Ebersol, chairman of NBC Universal Sports & Olympics, predicted Friday.

Few expect Jones’ off-the-field saga to influence ratings. Although running events are among the most popular, they slightly trail gymnastics, swimming and diving events in ratings, Ebersol said.

He said NBC’s coverage wouldn’t be hurt by the disqualification of other U.S. runners caught up in the drug probe. Besides Jones, he said, “none of them have much of a following.”

But just to be sure, NBC is lining up its promotional firepower behind members of the U.S. gymnastics team and other potential standouts.

They include Michael Phelps, a Baltimore swimmer trying to break Mark Spitz’s gold-medal record; decathlete Tom Pappas, who traces his family roots back to Greece, and fencer Keeth Smart, who holds down a full-time job at a New York communications firm.

“No one athlete determines the course of the Olympics,” Ebersol said. “The Olympics are the ultimate unscripted drama. And the stories this time around are just as great as they ever have been.”

In fact, on Aug. 21, when Jones is expected to run in the 100-meter finals, Texan Laura Wilkinson aims to compete for gold once again in the platform diving contest. She won that event in Sydney -- despite having a broken foot -- and delivered some of NBC’s biggest Olympic ratings that year.

“We might do more diving that night,” Ebersol said.

Some sports consultants said the steroid crackdown might end up helping NBC by protecting the integrity of the Olympic games, and, in the long term, the network’s investment. GE last year agreed to pay $2.2 billion for the rights to carry the 2010 and 2012 games.

“Drug scandals eat away at the integrity of the games,” said Paul Swangard, managing director of the Warsaw Sports Marketing Center at the University of Oregon. “NBC is an incredibly important stakeholder in the future of the games.”

The drama, and the attention over security in Athens might even boost ratings, said Neal Pilson, a broadcasting consultant to the International Olympics Committee and former president of CBS Sports.

“All of this attention and focus on Athens might propel more people to watch the games, unfortunately, to see if anything happens,” he said.