NBC Universal, the media unit of cable operator Comcast Corp, is paying $7.65 billion for the rights to six Olympic Games, surprising competitors by keeping its grip on the valuable live sports event for the next two decades.
The agreement, announced on Wednesday in a joint statement with the International Olympic Committee, includes media rights across broadcast television, cable TV, internet and mobile platforms, and extends NBC's previous contract by 11 years.
NBC sealed the exclusive deal to broadcast three winter games and three summer games from 2022 to 2032 before any other media companies could even bid. The IOC did not approach ESPN, a network spokesman said, and neither were Fox nor CBS.
NBC and rival networks have been stocking up on live sports content, which are popular with advertisers because large audiences watch in real-time and do not skip the TV commercials.
"It was a smart preemptive move to get control of the situation early," said Steve Ridge, media strategy group president at the consulting firm Frank N. Magid Associates, who added that advertising demand for the Olympics remains strong.
IOC president Thomas Bach said the organization wanted to build a long-term partnership with NBC, which also made the financial commitment. The IOC "did not see any reason to take any risk" by talking to other networks, Bach said.
The host cities of the six Olympic Games have not been selected yet. The next Olympics to be decided is expected to be announced in 2015 for the winter games of 2022.
The United States has not had an Olympics since the 2002 Salt Lake City Winter Games and could be back in the running to host the Summer Games of 2024 because interest is gaining momentum at home and among IOC members.
Comcast, which clinched full control of NBC Universal last year, used the 2014 Winter Olympics in Sochi, Russia, as a spring board to promote its prime time lineup and boost viewership of its cable networks. Live streaming online options of Olympic events from the games in Sochi also attracted tens of millions of dollars in advertising.
Macquarie analyst Amy Yong estimates that Comcast paid 20 percent more for each contest than it did on its last contract, which she said was is in line with other sports media deals.
The Olympics haven't always scored for NBC. The unit lost $223 million at the Vancouver Winter Games in 2010, according to General Electric, which owned NBC at the time. Olympics with prime time live events usually have better ratings.
NBC agreed in 2011 to spend $4.38 billion on the U.S. broadcasting rights for four Olympic games until 2020 when the games are in Tokyo. After that deal was announced, NBC executives had said the network should reap a profit from that contract.
NBC added on Wednesday that it had to agreed pay an extra $100 million signing bonus to promote the Olympics brand for five years beginning in 2015.
(Additional reporting by Julian Linden in London and Karolos Grohmann in Berlin; Editing by Ronald Grover and Grant McCool)