As a result, U.S. broadcasters contribute much more money than their counterparts in other countries to support the Olympics. For rights to the 1996 Summer games in Atlanta, Georgia, NBC paid $456 million, a figure that did not include the cost of the production itself (estimated at another $150 million). All of the western European nations combined paid $250 million in fees for the same games. Whereas Canada’s CBC paid $160 million to broadcast all of the Olympic games between 2000 and 2008, NBC paid $3.5 billion for those same rights, thereby serving as the IOC’s largest single financial underwriter.

Consequently, the U.S. networks hold a powerful position in the Olympic arena. Their financial support often allows them a measure of influence in scheduling, especially when determining the time slots for the most popular events. Traditionally, the Winter and Summer Olympics were held in the same year, once every four years, but in 1994 the IOC changed the timing of the games and adopted a two-year staggered schedule, in part to accommodate the U.S. media. Following the 1992 Summer and Winter games, therefore, the next Winter Olympics were held in 1994, in Lillehammer, Norway, followed by the 1996 Summer games in Atlanta, easing the strain on corporations that were beginning to find the price of quality Olympic advertising prohibitive. With 30-second spots selling for hundreds of thousands of dollars during Olympic broadcasts, and companies paying hundreds of millions of dollars for a sponsorship package, neither the IOC nor the networks could afford to lose these important clients. Spacing the Summer and Winter Olympics two years apart thus allowed sponsors to spread out their costs and also to invest in more high-profile packages. The revised schedule also granted the IOC more time to allocate the revenue effectively.

The Olympics first attracted a significant television audience during the 1968 Summer games in Mexico City, when Roone Arledge was at the helm of ABC Sports. Arledge was instrumental in establishing ABC as the dominant network in Olympic television—a legacy that endured for a quarter century, from the Winter games of 1964 in Innsbruck, Austria, through 1988 in Calgary, Alberta. The combination of Arledge’s in-depth, personalized approach to sports broadcasting (epitomized in ABC’s Wide World of Sports) and the technological advances in the field, such as satellite feeds and videotape, set the new standard for Olympic telecasts. Utilizing inventive graphics and personal profiles of the athletes, Arledge slated 44 hours of coverage for the Mexico City games, three times as many hours as the Tokyo Summer games of 1964. He presented the coverage as a dramatic, exciting miniseries for the television audience, and successive producers have continued to expand on this model.

The 1972 Summer Olympics in Munich, West Germany, saw further growth in costs and coverage. However, the drama of the games was overshadowed by the grisly murder of 11 Israeli athletes at the hands of Palestinian terrorists. Viewers watched in horror as the events of the massacre of September 5–6 unfolded, and television turned into an international forum for the extremist politics of the Black September Organization. This event became the worst tragedy in the history of sports broadcasting.

The Olympics have also given television sports some of its most glorious moments and beloved heroes. Few in the United States will ever forget the U.S. ice hockey team’s thrilling victory over the Soviet team in 1980, Romanian gymnast Nadia Comaneci’s perfect performances, the U.S. women gymnasts winning their first team gold medal ever in 1996, or the dedication and perseverance of such athletes as Mark Spitz, Carl Lewis, or Dan Janssen. In many instances, the top U.S. athletes also become media celebrities, winning lucrative endorsement and commercial deals along with their medals. For the 2002 Olympics in Salt Lake City, Utah, there were advertising campaigns designed around gold medal hopefuls that aired months before the games even began.

Aside from catapulting athletes to media stardom, the Olympic games are usually a ratings boon for their host network. In the United States, that network customarily captures 50 percent of the television audience each night of the Olympic telecast.

The audience drawn to the Olympics often translates into increased ratings for the host network’s regularly scheduled programming as well. The tremendous till of advertising revenue and the potential spring-board into a new season likely ensures that the Olympic U.S. broadcast rights will remain among the most coveted and expensive in all of television.

Bids for these rights are made knowing that traditionally, networks lose a great deal of money on the Olympics. Consequently, it has been argued that network coverage of the games has expanded to the point of excess in the attempt to recoup spiraling costs by selling more commercial time. However, the games have become such an emotionally charged part of a network’s inventory that profit is no longer the chief concern. Broadcasting the Olympics, much like broadcasting professional sports, is more about building a network’s reputation than about making business decisions driven solely by the bottom line. The long-range prestige and promotional value for the host network have been deemed far more important than any immediate financial losses incurred by covering the games.

Nevertheless, the expense of televising the Olympics can be quite draining at times, as the 2000 Sydney “Internet Olympics” demonstrated. Faced with an unwieldy 15- to 18-hour time difference between Australia and North America, NBC decided to broadcast all 441.5 hours of the games on tape delay in the United States. The day-old offerings on U.S. television could not compete with the immediacy of results available via the Internet, and NBC’s investment of over $800 million in the broadcast resulted in a ratings disaster—the worst Nielsen audience ratings for the Olympics since 1968.

The gamble on Olympic broadcasting only gets riskier as rights fees continue to skyrocket. The Squaw Valley (California) Winter games in 1960 cost CBS only $50,000. Twenty years later, NBC bid an astonishing $87 million for the 1980 Summer games in Moscow. This price was almost four times the fee for the rights to the previous (1976) Summer games in Montreal. Unfortunately for NBC, the U.S. boycott of the Moscow games destroyed hopes of a windfall and sabotaged the scheduled 150 hours of planned coverage. Still, prices have continued to climb. The Summer broadcast rights almost tripled from 1980 to 1984 ($87 million to $225 million), and both Winter and Summer rights have gone for $300 million or more since 1988. In 1995 NBC made its unprecedented $3.5 billion deal for the 2000 through 2008 games, a deal that, despite its overwhelming numbers, was touted as a historic coup giving the network a virtual “monopoly” on the Olympic games.

In the past, these exploding costs have sent networks looking for alternative strategies to ease the financial burden. In 1992 NBC made an ill-fated attempt at utilizing pay-per-view subscriptions for the Summer games in Barcelona. The “Olympic Triplecast” was organized in conjunction with Cablevision and intended to sell packages of commercial-free, extensive programming. The plan was an enormous failure, owing to its complicated, confusing design and viewers’ resentment over having to pay for certain events when others were free of charge.

CBS had more success in reducing its outlay by joining forces in 1992 with TNT (Turner Network Television). The Winter Olympics that year (CBS’s first Olympic telecast in 32 years) began a collaboration between the two networks that gave TNT 50 hours, or about 25 percent of the total programming time, in exchange for $50 million toward rights fees. The arrangement was so successful that it was renewed in 1994 for the Lillehammer games. The sharing of broadcast duties and costs seemed to hold promise for both the quality and cost of future Olympic coverage, especially when ABC and NBC were negotiating a partnership deal to cover the 2000 Sydney games together. However, NBC instead secured the sole rights to cover the first five Olympics of the new millennium, adding the Olympic logo to their network “brand” for nearly a decade and hoping to strengthen their own image through this unique identification with the games.