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NBC's game plan a winner

Its multi-platform effort to cover the Olympics appears to have turned a prediction of a $200 million loss into a small profit and a working model for the future.

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By David Sell and John Timpane
The Philadelphia Inquirer
Published:
  • Jamaica's Usain Bolt crosses the finish line to win gold in the men's 100-meter final during the athletics in the Olympic Stadium at the 2012 Summer O...

    Jamaica's Usain Bolt crosses the finish line to win gold in the men's 100-meter final during the athletics in the Olympic Stadium at the 2012 Summer Olympics, London, Sunday, Aug. 5, 2012. (AP Photo/David J. Phillip )

  • Jamaica's Usain Bolt (left) crosses the finish line ahead of Ryan Bailey of the United States in the men's 4x100-meter relay final in the Olympic Stad...

    Associated Press

    Jamaica's Usain Bolt (left) crosses the finish line ahead of Ryan Bailey of the United States in the men's 4x100-meter relay final in the Olympic Stadium at the 2012 Summer Olympics, London, on Aug. 11.

PHILADELPHIA -- For NBC-Universal, the Olympic Games brought the thrill of breaking even and the shutting up of the naysayers.
As the dust of the track settles, and the stats and data shake out, NBC's coverage of the world's biggest sporting event, on network TV, cable and the Web, looks good enough to earn a medal.
Despite programming glitches, confusion over venues and schedules, and the nbcfail Twitter feed, London 2012 is a win for Comcast Corp., the Philadelphia-based majority owner of NBCUniversal. Plus this: A Comcast effort to cross-link and cross-promote all content among all media platforms may well be the look of the future for big news and entertainment.
Especially if NBC makes money. Which it might. Early forecasters saw a $200 million loss. But Mark Lazarus, chairman of NBC Sports Group, said that, while a full accounting is a few weeks off, "we believe we will break even and might finish with a small profit." That would be welcome after NBC's $223 million loss with the 2010 Vancouver Winter Olympics.
At the start, London 2012 didn't look good. Many viewers, especially in the Twitterverse and blogosphere, moaned bitterly that NBC was tape-delaying major events for prime time. (Everything was available live online, but not on TV.) A sample tweet, from tomwatson: "Never in the field of human endeavor have so many labored to give so few live Olympic events -- Winston Churchill nbcfail." That nbcfail is a Twitter "hashtag" label, meant to organize discussion and protest.
Lazarus acknowledged that, with so much offered so many places, there were communications gaps and confusion: "We can continue to improve on that." A few odd programming moves didn't help. "Their Finest Hour," a World War II documentary hosted by Tom Brokaw, ran Saturday in prime time, drawing complaints on Twitter.
But NBC rolled out a massive effort, befitting the $1.18 billion it paid for U.S. rights. Try 5,535 broadcast hours (almost 7 1/2 months' worth) over the national network, eight cable channels -- NBC Sports Network, MSNBC, CNBC, Bravo, Telemundo, two specialty channels, and one 3-D channel -- and online at NBCOlympics.com. The hours available more than doubled the previous record, set at the 2008 games in Beijing.
People watched. Nielsen figures say that over 17 Olympic nights NBC averaged 31.1 million viewers daily on TV. Though some had predicted a downturn in audience, NBC coverage attracted 219.4 million viewers for at least six minutes (the Nielsen minimum), more than the 215 million for Beijing. That makes London 2012 the most-watched event in U.S. TV history.
"That's a surprise," said Lee Rainey, director of the Pew Research Center's Internet & American Life Project. "In this era, when mega-events are drawing less audience, because there's so much competition for attention, this one broke the pattern. Part of it is probably the social-media component."
What of nbcfail? That, too, faded. NBC said only 0.5 percent of the 150 million tweets during the Olympics, 750,000, had the hashtag.
Point is, people did sit down and watch. According to Nielsen figures, the audience started big and stayed big. Also, viewers told pollsters: A Pew Research Center poll found that 77 percent of TV watchers rated coverage good or excellent, as did 70 percent of social media/online users.
Viewers also reveled in a now-established behavior: They flipped among NBC channels, and they watched on multiple screens or platforms at once, TV-plus-laptop, or maybe TV/laptop-plus-cellphone, tweeting and/or posting on Facebook while watching or during commercials. Comcast's Xfinity customers, for example, verified an average of 2.4 devices for streaming Olympics content.
"Multiple-screen watching has exploded," said Rainie, "and it vastly expanded the audience for these Olympics."
(Credit U.S. athletes, too, winning 104 medals and leading the world.)
Jessica Reif Cohen, a Bank of America Merrill Lynch analyst, has a buy rating on Comcast stock and owns some. She likes Project Symphony, Comcast's assiduous effort to cross-link and cross-promote all content everywhere: "The idea is that you cross-promote and connect TV and cable and movies and Web and all the other properties." NBC's success reminds her of another entertainment cross-promoter, perhaps the best of them: Disney.
Matt Strauss, senior vice president for digital and emerging platforms for Comcast Cable, said the cross-linking effort "demonstrated the power of the audience, with a tremendous amount of video, and then funneling and focusing that interest. We can drive awareness."
Profits? Lazarus put gross revenue at $1.25 billion. That beats the $850 million raked in during Beijing and bests internal projections by 15 percent to 20 percent. He said high ratings helped NBC sell ads later in the games at a higher rate.
Cash is only part of it: Eyeballs are another. NBC got viewers to watch NBC. And it tried an aggressive programming experiment, curtailing Olympic coverage on two nights at 11 p.m. to show pilots for two fall sitcoms without commercial interruptions.
The gamble paid off, with Matthew Perry's comedy "Go On" attracting 16.1 million viewers and Justin Kirk's "Animal Practice" drawing 12.8 million. (The latter ticked off some broadcast viewers because it bumped the Who's performance at the closing ceremony to late-night. It was live online.)
Not new as a concept, said Lazarus: "Every network has used sports to promote other content. That has become part of the ecosystem of the TV business." "Parenthood" launched well out of the 2010 Vancouver Winter Olympics on NBC and has been renewed for a fourth season. In February, the second season of "The Voice" got a jump-start out of the Super Bowl.
Lazarus hopes the Games brought new viewers to "Today and "NBC Nightly News, whose anchors and reporters appeared frequently in Olympics coverage.
Was all the self-promotion too much? As in, "Now it's time to interrupt our promos for NBC's new comedies to bring you the men's 4-x-400 finals"?
"We actually didn't think the NBC program promotions within the Olympic telecasts (were) heavy-handed," said Andy Donchin, director of media investments and national broadcast for Carat, a major advertising firm. "There was not a noticeable increased commercial load versus past telecasts," he said by email.
Can the Peacock ride the wave? Donchin said the time lag before the shows re-air in September works against them. In the end, he said, "it all depends on the shows. If they are good, they will probably find an audience."
Len Fogge, NBC's president of marketing, said via email that "a platform like the Olympics can give you a major lift in awareness and sampling, and London did a great job of that for us."
Can this boost NBC, once proud, now bedraggled? It finished third among the networks last season, behind Fox and CBS. It beat ABC by a hairbreadth, thanks almost entirely to football - the Super Bowl and "Sunday Night Football (which dethroned "American Idol this year as the most watched program on TV).
Stock analyst Cohen thinks Olympic success will help NBC in 2014 and 2015, when retransmission contracts - the fees networks get from cable, satellite, and telephone companies to transmit their signals - are renegotiated. Above all, NBC gets four more Olympic bumps: "The Olympics are like the Super Bowl, except it's the Super Bowl for a two-week period. And it's (NBC's) through 2020."
"I think we'll look back at these Olympics as a turning point in how people look at platforms, customer demands, and how and where they want content," said Strauss. "You can't argue with 219 million viewers."
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(David Hiltbrand of the Philadelphia Inquirer contributed to this report.)
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©2012 The Philadelphia Inquirer
Visit The Philadelphia Inquirer at www.philly.com
Distributed by MCT Information Services
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Topics: t000040194,t000003183,t000002409,t000002537,t000040350,t000002664,t000002437,t000002674,c000214209w
Story tags » TelevisionInternet & CloudMediaSummer OlympicsSocial media

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