The Impact The Postponement Of The Tokyo Olympics Has On Broadcasters

Covid-19 has now officially postponed another mainstream event, formerly known as, the Tokyo 2020 Olympics.

In a statement to reporters on Tuesday, Japan’s Prime Minister Shinzo Abe said the IOC (International Olympic Committee) had agreed and officially confirmed the delay following IOC member Dick Pound’s comments. The new dates are not yet known but the postponement will be for at least one year.

“I proposed to postpone for about a year and [IOC] president Thomas Bach responded with 100% agreement,” Abe said.

The postponement marks the first major disruption to the Olympics since World War 2, when in 1940 the Summer Olympics were cancelled. Coincidentally, the games were also scheduled to be held in Tokyo.

Broadcast impact 

Major broadcaster NBCUniversal, who paid $7.7 billion to retain the rights through 2032 in 2014 and have broadcast the Summer Olympic Games since 1988 and the Winter Games since 2002, had sold more than $1.25 billion in advertising for this year’s games. Equating to nearly 90 percent of the available ad space. The organization had also committed a combined 7,000 hours of content across broadcast, streaming and social media platforms. 

Sponsors that had signed on to sponsor the games prior to the postponement included Coca-Cola, Visa, Procter & Gamble, Airbnb and General Electric. 

Parent company Comcast’s CEO Brian Roberts said Tuesday: “At this point, it is impossible to predict such extent and duration and the degree to which supply and demand for our products and services, including advertising, will be affected.”

Internationally, Discovery hold the exclusive pan-European pay television rights to the Games and sub-license to free-to-air networks across numerous territories, except Russia. The deal signed in June 2015 cost Discovery €1.3 billion and gave them the rights until 2024. 

In a conference call on quarterly earnings in February Discovery CFO Gunnar Wiedenfels stated that Discovery would take a top-line hit if the event is canceled but that expenses would fall as well, making the financial impact minimal.

“It will be a positive if it happens, and if it doesn’t happen there won’t be an adverse effect on our financials,” he said. 

The company said it also has insurance taken out in case of cancellation.

The Olympics follows a long list of sporting events around the world that have been indefinitely suspended to date including Euro 2020. Professional sports associated with those events include Soccer, Basketball, Tennis, Boxing and MMA.