Bloomberg News

NBC’s Tape-Delay Strategy Boosting Ratings, Revenue

August 01, 2012

NBC’s Tape-Delay Strategy Helping It Break Even on Olympics

Omar Pinzon Garcia of Colombia competes in heat 3 of the Men's 200m Backstroke on Day 5 of the London 2012 Olympic Games at the Aquatics Centre on August 1, 2012. Photographer: Clive Rose/Getty Images

NBC expects to be “right around” the point of making money on its London Olympics coverage, beating expectations after tape-delayed broadcasts during prime time drew higher ratings than during the previous Summer Games.

The ratings for the games are up 9 percent so far from the Olympics in Beijing, much better than what the network was predicting, Steve Burke, chief executive officer of Comcast Corp. (CMCSA:US)’s NBCUniversal, said today on a conference call. The broadcaster had projected a $200 million loss for the games.

The results suggest that NBC’s strategy of tape-delaying the Olympics for U.S. audiences is paying off. The network has been criticized for the approach, which has forced Americans to watch the opening ceremonies and key events well after they occur. Guy Adams, a British journalist based in Los Angeles, was temporarily suspended from Twitter after he posted the e-mail address of NBC Olympics President Gary Zenkel while urging users to complain.

NBC, which paid $1.18 billion for the rights to the London games, had projected a ratings decline of 20 percent versus the Beijing games, when more of the coverage was live. Instead, viewership is “way up,” Burke said on the call today.

Olympic Costs

NBC had lost $223 million on the last Olympics. David Joyce, an analyst at Miller Tabak & Co. in New York, estimates that NBC’s production costs added an additional $100 million in expenses for this year’s games.

Comcast, the cable-TV provider based in Philadelphia, acquired control of NBCUniversal for $13.8 billion in January 2011. The business, which includes TV, film and theme-park units, contributed about 36 percent of Comcast’s sales in the second quarter.

Twitter Inc., which has a partnership with NBC to provide Olympics coverage, apologized yesterday for the “mess up” surrounding the suspension of Adams, a writer for the U.K.’s Independent newspaper. The social-networking company restored Adams’s account after an outcry over the incident. Critics said that by initially blocking his account, Twitter put the partnership with NBC ahead of its goal of disseminating information.

Adams had criticized NBC in a number of tweets for its policy of tape-delaying the major Olympic events on its broadcast network. The company is showing live events to cable subscribers online.

To contact the reporter on this story: Alex Sherman in New York at asherman6@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net


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