Even before the 2008 Beijing Olympics begin this summer, NBC Universal is already talking to distributors about carrying the 2010 and 2012 games, apparently offering them a “super-sized” package of HDTV and on-demand Olympic services this year to hop on board for the future.
The carrots, which could include channels about specific sports such as basketball and soccer, are being dangled as eight-year-old contracts for carrying many NBC outlets, both broadcast and cable, come to an end.
The games in China this Aug. 8 to 24 are the last Olympics covered by a comprehensive carriage deal that NBC executed with most of the nation’s cable and satellite-TV distributors back in 2000.
Cable-industry executives said the “enhanced” Olympics package is being offered to keep distributors on board after the conclusion of a series of pacts considered the crowning achievements of then-NBC Cable president David Zaslav, now CEO of Discovery Communications.
The Zaslav deal included: five Olympics during the span of the contract, ending with this year’s Games; retransmission consent for 13 NBC owned-and-operated stations; deal extensions and rate increases for MSNBC and CNBC; and a roughly $1-per-year, per-subscriber Olympics surcharge — which NBCU now characterizes as “a premium fee” — during the contract.
Some of those carriage agreements were for 10 years, and others were for eight years, which means those will expire at year’s end. For example, Time Warner Cable had a deal that went through 2008.
To complicate matters, in some instances those eight- and 10-year deals are no longer in force, having been superseded by new carriage agreements that NBCU had reached with distributors since 2000.
But in all those scenarios, NBCU must still negotiate deals for cable and satellite operators to offer the 2010 Winter and 2012 Summer Games. And the programmer is again seeking a “premium fee” from distributors for those upcoming Olympics, said cable-operator officials.
NBCU declined to comment. But the programmer, said cable-system executives, is offering an “enhanced” Olympic package — with additional HD, VOD, broadband and interactive content — to get distributors to extend their carriage deals to 2012.
NBCU has previously announced ambitious plans for the Beijing Olympics, with more than 3,600 hours of linear TV coverage on NBC, USA Network, Oxygen, MSNBC, CNBC and Telemundo, as well as HD coverage on USA HD and Universal HD. There are also 2,200 hours of live-streaming on NBCOlympics.com.
But the enhanced or “super-sized” offer NBCU has out to operators comes on top of all that, and includes additional HD, broadband and interactive programming for those carriers extending their deals to 2012.
For example, NBCU will provide some sports-specific Olympic channels, for events such as basketball, said one cable operator. In addition, there will be live streaming of 24 events on NBCOlympics.com that will be exclusive to cable, telco and satellite customers, the executive said.
“Their strategy is, ‘Let’s come out with some added-value in 2008 and use that to try to get people to re-up for 2012,’” the operator said.
Deals vary from distributor to distributor, so in some cases NBCU is only seeking extensions that cover the 2010 and 2012 Olympic games. In others, it is looking for renewals that also encompass cable services such as CNBC and MSNBC, according to several cable-operator executives.
In Time Warner’s case, for example, the cable company is looking to do a broad NBCU deal that would include cable-network renewals, the extension of retransmission-consent for NBC stations, future Olympics, and digital and VOD rights.
In contrast, DirecTV confirmed it is just talking to NBCU about carrying the Olympics after this year, not any major cable-network renewals. Comcast has acknowledged it is in discussions with NBCU regarding Olympics content.
R. Thomas Umstead also contributed to this story.
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