AP Interview: IOC negotiator expects at least 3 bidders for US TV rights to 2014, 2016 Games

AP Interview: IOC expects 3 or more US rights bids

LAUSANNE, Switzerland — The IOC expects at least three networks or media consortiums to bid for the U.S. television rights to the 2014 and 2016 Olympics and believes the winning offer will exceed the previous $2 billion deal.

Richard Carrion, who negotiates the U.S. rights for the International Olympic Committee, said in an interview with The Associated Press that he has already received several expressions of interest from American networks and plans to make a deal sometime in 2010.

“I would expect a minimum of three players,” Carrion said.

The negotiations were postponed a year ago because of the global financial downturn, but the IOC is prepared to open the bidding after the Vancouver Olympics.

“We can still wait, but things are better than six months ago,” Carrion said in Lausanne, where he attended IOC executive board meetings this week. “There a lot of things going on in the marketplace. It’s very likely we’ll do it in 2010 sometime. Whether it’s in the first half of the year or the second half of the year, it’s not clear.”

Along with current rights holder NBC, ESPN-ABC has publicly expressed interest in bidding for the 2014-16 contract. Potential contenders also include Fox and a joint bid from CBS and Turner.

“I think we will see different consortiums come together,” Carrion said. “In an event of the size of the Olympic Games, given the various platforms that are now available, I think it will require a consortium to be assembled to take full advantage of all of that.

“Whether there are companies that have most of those platforms in house and can sub-license or whether groups will assemble, that’s not entirely clear to us how that will shake out. But there is interest in the market place without doubt.”

U.S. broadcast rights represent the biggest single source of income for the Olympic movement. At stake this time are the rights to the 2014 Winter Games in Sochi, Russia, and 2016 Summer Games in Rio de Janeiro.

Carrion, a banking executive from Puerto Rico who serves on the IOC board, said he expects to secure a more lucrative deal than the $2.2 billion contract signed with NBC and parent company General Electric in 2003 for the 2010 Vancouver Games and 2012 London Olympics.

NBC outbid Fox and ESPN-ABC for those games, which included $2 billion in rights fees and an additional $200 million in sponsorship from GE.

“Obviously we’d like to improve,” Carrion said. “When you look at the overall picture, you will see markets that were lesser developed that are now showing big increases, including Brazil, some of the Asian Markets and even Europe. We will expect to improve on ‘10 and ‘12, without a doubt.”

Carrion said he’s had recent contacts with potential bidders, including talks with NBC about Comcast’s proposed purchase of a controlling stake in NBC Universal. Carrion said he doesn’t expect the multibillion-dollar deal, which could take a year to go through, will impact NBC’s Olympic role and ambitions.

“I don’t think that it’s going to alter the calculus much,” he said. “Clearly, this transaction is about content, and the Olympic Games are arguably the most compelling sports content in the world. I don’t think their interest has been diminished.

“My understanding is that (NBC Universal Sports and Olympics chairman) Dick Ebersol will lead the combined sports department and Dick is a big believer and a big supporter of the Olympic Games. It’s probably a positive but we’ll see when the bids come in.”

Carrion said the IOC won’t wait for the takeover to be completed before negotiating the rights.

“We will go when we think is the right time to go,” he said. “We’re not going to wait for the approval. I think it’s highly likely that the deal will get approved, but we’re not going to wait for that.”

Carrion said the IOC likely will hold the same bidding competition as in 2003, when the committee accepted sealed bids from the networks at a meeting in Lausanne, Switzerland.

“That’s the inclination right now,” he said.

Had Chicago secured the 2016 Olympics, Carrion acknowledged, the IOC could have commanded higher offers from the U.S. networks with the Summer Games on home soil for the first time since 1996. But Chicago was eliminated in the first round of voting in Copenhagen on Oct. 2, and Rio became the first South American city to get the games.

“The IOC makes its decisions not to maximize television revenue,” Carrion said. “They make the decision to do what we believe is best for the Olympic movement.”

Besides, he said, Rio’s time zone — one hour ahead of the U.S. East Coast — is favorable to U.S. viewers.

“I don’t think the delta between Rio and Chicago is that great from the perspective of an American television audience,” he said. “I think clearly U.S. networks would have preferred Chicago … but from a scheduling perspective, I think Rio is clearly in a good position vis a vis the American marketplace.”

Carrion, meanwhile, said the U.S. Olympic Committee’s controversial plans to launch its own Olympic network — with Comcast as partner — appeared off the table for now.

The USOC announced the plans in July but put the project on hold a month later after complaints from Carrion and other IOC officials.

“We had asked for some information. They have not given it,” Carrion said. “I think the USOC has made a very clear statement they are not going to go ahead with anything without our approval.”

Carrion, who also chairs the IOC finance commission, said the committee enjoyed a good financial year despite the downturn — with reserve funds increasing 12.9 percent in the first 11 months to $465 million. The IOC took a $5 million hit last December in the Bernie Madoff scandal, but Carrion said the IOC has “erased that loss and then some.”

The bulk of the IOC’s television and sponsorship contracts are all in place for the 2010 and 2012 Olympics, with the possibility of one or two more global sponsors signing up before the Vancouver Games, Carrion said.

“We just have to put on the games,” he said. “In these very difficult and very turbulent economic times, I think we are in a good position.”