For decades, the Canadian TV rights for the Olympic Games have changed hands between public broadcaster CBC and the country’s largest private network, CTV. Now the two have decided to partner for an upcoming bid – and they might not have much competition.
Friday’s announcement comes one day after Rogers Communications Inc. said that it would not bid on the next two Olympics, opting out of its partnership with Bell Media, which owns CTV. The Rogers-CTV consortium broadcast the Winter Games in Vancouver last year, and will also broadcast the London Games next year.
It’s a crucial move from the perspective of the International Olympic Committee, because CBC and CTV are no longer competing against each other in the bidding, and another competitor may not emerge at all for the Winter Games in 2014 in Sochi, Russia, and the 2016 Summer Games in Rio de Janeiro.
According to a source with knowledge of the matter, part of the contract for Canada’s Olympic Broadcast Consortium, as the Rogers-CTV partnership is known, involved a clause that if Rogers decided not to bid again within the consortium, it could not bid at all. That means Rogers cannot change its mind about bidding on the next two Games. The IOC potentially faces a situation where only one bid is submitted from Canada’s broadcast industry.
“I really don’t know [if this will be the only bid]” Bell Media president Kevin Crull said. “Our bid will be beneficial for everybody involved, for sure. It’ll be a sensible bid, but it’ll be reflective of the fact that this is the premier sports event in the world.”
Before the Rogers-CTV consortium was formed, the public broadcaster held the Olympic rights for 12 consecutive years – part of that time in partnership through a sublicensing agreement with specialty sports channel TSN, which BCE now owns along with the rest of the broadcast assets of CTV.
“Earlier this year there was some speculation about CBC being a viable force going forward, in sports,” said Jeffrey Orridge, executive director of CBC Sports properties. “Since I’ve been here, we did the deal with the International Skating Union, we’re extending our relationship with Rogers in tennis, and now we’re partnering with Bell Media on an Olympic bid. In sports, it doesn’t get much better than this.”
In 2003, Bell Globemedia Inc., which owned the broadcast assets of CTV at the time, was responsible along with Rogers for wrenching the TV rights to the Olympics away from CBC. The Rogers-CTV consortium’s $153-million (U.S.) bid was the largest in Canadian history.
Due in part to a rough economy that hammered marketing budgets and made ad sales difficult, the broadcast partners actually lost money on the Vancouver Games, and also expects to lose money on the London broadcast.
The bidding for the next two Games is not expected to reach the astronomic price that an Olympics on Canadian soil coaxed from broadcasters. Complicating broadcast plans is the time difference with Russia for the Winter Games, and uncertainty over whether the NHL will allow its players to participate again. But limited competition is likely to push the price down even further when the interested bidders travel to IOC headquarters in Lausanne, Switzerland, later this year to submit their offers.
The broadcasters are operating in a market where the cost of acquiring TV rights to sports events is rising quickly – leading to speculation, especially after the last round of bidding, that Olympic rights were overvalued. That trend could temporarily reverse here, but in general, these types of broadcast partnerships may be the new reality in the world of televised sports.
“Clearly the trend is in escalation of rights fees for sports properties, for a number of reasons,” Mr. Orridge said. “In order to be viable, more and more opportunities for collaboration are going to present themselves.”