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Athens battles ghost of Sydney
After a slow start for NBC, fears recede of Sydney-like ratings disappointment, unhappy advertisers.
August 18, 2004: 11:22 AM EDT
By Krysten Crawford, CNN/Money staff writer

NEW YORK (CNN/Money) - American swimmer Michael Phelps and NBC have something in common: With expectations high, both got off to a shaky start at the Olympics, but both are now showing signs that things have turned around.

For Phelps, whose bid for record gold at Athens ended almost before it began, that meant winning his second and third gold medals Tuesday after taking the bronze in two events.

For NBC Universal, parent of the NBC network and a unit of General Electric (GE: Research, Estimates), it meant scoring the ratings knockout that the first three days of around-the-clock Olympics coverage failed to deliver.

The network said it scored its highest rating yet on Monday night, with a 16.6. Translation: 16.6 percent of all U.S. households with televisions tuned into the games, compared to 13.8 percent four years ago.

Overall, Athens is pulling an average 14.7 rating, NBC said, making it the most widely watched Olympics to take place outside of the United States. Athens viewer numbers are 2 percentage points higher than Sydney's 14.4 draw.

The ratings are significant for several reasons.

NBC Universal paid a record $793 million for the exclusive rights to televise the Athens games -- and will pay another $4.2 billion for the rights to the next four winter and summer Olympics through 2012.

So far, the company, which has broadcast the Olympics since 1988, has lost money only on the Barcelona summer games in 1992.

If NBC can deliver large audiences, the network gets more than bragging rights during the annual summer ratings war.

Advertisers buy commercial air time based on promised ratings. If the ratings miss, as they did four years ago in Sydney, NBC Universal must make good on its promises by giving advertisers free commercial airtime later. The makeup time slots are essentially lost money for NBC Universal.

A lot of money, a lot of hours

So far, NBC has sold about $1 billion worth of advertising and sponsorships for the Athens Olympics, which end Aug. 29. The average cost of a 30-second prime-time Olympics spot runs about $700,000.

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To avoid a Sydney-like ratings letdown, NBC reduced its prime-time Athens coverage from five to four hours a night. At the same time, it planned an unprecedented level of around-the-clock coverage using all seven of its networks to air the games, including MSNBC, CNBC, Bravo and the Spanish-language Telemundo.

By televising 1,210 hours of competition, NBC Universal is hoping to boost ratings at its cable and broadcast networks and take advantage of some accounting benefits to reduce production costs.

There's no question that the Olympics delivers a ratings boost. Rival networks all but concede defeat for two weeks every two years. But the data on viewer numbers, which NBC released but which originated with Nielsen Media Research, can be misleading.

Slicing through the spin

NBC Universal, for example, boasted that the opening ceremony drew 56 million total viewers during the four-hour telecast, with ratings peaking when U.S. athletes entered the Olympic stadium during the opening ceremony's parade of nations.

The 56 million reflects what's called the reach number. That figure counts any viewer who happened to tune in, no matter how brief the stop. A better measure is the average audience -- for the entire opening ceremony, that came to 25.4 million viewers over the age of 2, according to Nielsen Media Research.

As Hurricane Charley ravaged Florida towns, Friday's opening ceremony drew fewer viewers than either Sydney in 2000 or the Atlanta summer games in 1996, but more than Barcelona in 1992.

The power of sweat & gold

After a slow start, NBC network's Athens ratings started to pick up Sunday when Phelps, the American swimmer, won the first of his three golds.

Since then, Phelps' bid for a record eight gold medals in a single Olympics swimming competition has ended, stopped cold by Australian powerhouse Ian Thorpe. And through the end of Sunday, Athens' overall ratings lagged behind those of Sydney.

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Phelps' diminished hopes mirrored the challenges NBC ran into early on. U.S. gold medals deliver ratings. So, too, does human drama.

Until Monday, the Athens Olympics had been lacking in both. The U.S. women gymnasts were struggling as they headed into Tuesday's team competition, the U.S. basketball team suffered a stunning defeat against Puerto Rico and spectator seats at some events have been noticeably empty.

The U.S. was tied for second in gold medals as of Tuesday evening, four medals behind No. 1 China, with 10 golds. Tuesday afternoon the Americans overtook China to lead in the overall medal count, with a total of 19.

At this rate, it seems more and more likely that the American athletes are going to deliver for NBC.  Top of page




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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.