The Wall Street Journal is reporting that NBC's (NYSE: GE) decision to limit the amount of footage from the recent Olympic Games it showed on its websites significantly impacted their online revenues for the games. According to research firm eMarketer, Inc., the network's efforts only brought in approximately $5.75 million in online revenues for the games, a paltry showing for such a major event, if true.
Interestingly, the New York Times also weighed in on NBC's online efforts for the Olympics, proclaiming "the extent to which the Internet served as a supplement to television was unprecedented", and that "NBCOlympics.com served up more than 1.2 billion pages and 72 million video streams through Saturday, more than doubling the combined traffic to its site during the 2004 Games in Athens and the 2006 Games in Turin."
The NY Times article also went on to state that "The popularity of the site will very likely make digital rights more significant in next year’s bidding for the 2014 and 2016 Games". As has already been widely reported, both ESPN (NYSE: DIS) and Fox (NYSE: NWS) have shown strong indications of interest in acquiring the rights from the incumbent NBC for future games. NBC's perfomance here could make them vulnerable to losing future rights altogether, but there could also be significant upside for either ESPN or Fox in their bid for the 2016 games as both companies have much better track records in the monetization of their online properties.
The big question seems to be that with this record traffic and assuming eMarketer's forecast is accurate, how did NBC only bring in $5.75 million when the WSJ reports that CBS (NYSE: CBS) brought home more than $23 million for the NCAA Tournement? It sounds like there are significant execution issues weighing on NBC's online efforts. If this truly is the case, one has to wonder where else in the company are opportunities to immediately expand the monetization of online properties, and why isn't that happening now?
One also has to to take note that for the first time in the entertainment landscape, proper monetization of digital rights- previously only viewed as ancillary revenues, now could have a significant impact to the core business should the network lose out in the bidding to broadcast rights to companies who are more adept in this arena. NBC may have greater broadcast and cable distribution than other media outlets, but online efforts may have leveled the playing field for the smaller competitors.
This article has 4 comments:
We are told that they even negotiated with the IOC and Beijing in order to re-schedule the volleyball games for prime-time broadcast.
Why did we need to stay up until midnight to see traditional events like gymnastics? Because NBC bought exclusive rights to broadcast volleyball for the next 5 years and they needed to create an audience for America's 'New Sport'. Even the legendary Decathlon was ignored.
So if you want to know why the Internet coverage was so robust you need look no further than NBC's narrow, biased and self centered TV programming.
The people wanted more!
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