The Strategist

NBC reports sharp decline in ad revenue during COVID-19 pandemic

08/03/2020 - 08:31

Cancellation of the sporting event and the postponement of the Tokyo Olympics, which was due to open in late July have had an extremely negative impact on the performance of the contract with the International Olympic Committee (IOC) for its broadcast on the US television company NBC. Its ad revenues for the second quarter of this year fell by almost a third.

Gareth Simpson
Gareth Simpson
NBCUniversal reported the fall in advertising revenue to Insidethegames, citing a business report from Comcast, a conglomerate that includes the broadcaster. According to the company, in the second quarter of this year, that is, in the period from April to June inclusive, they decreased by 28% compared to the first.

The report’s authors cite "the decreased costs of advertisers in connection with the COVID-19 pandemic" as the reason for the fall, including due to the drop in ratings "due to the postponement and cancellation of sports events."

The reporting period, indeed, was the peak of the pandemic, which had a colossal negative impact on the sports industry. In the second half of spring, it hardly showed any signs of life - they appeared only in June. Insidethegames also emphasizes that the transfer of the Olympics to Tokyo, although it was only supposed to open on July 24th, should also be taken into account when analyzing NBC's problems, as "commercial preparation" for the Olympic Games usually begins in late spring.

NBC is, in fact, a key partner of the IOC. Under a contract signed in 2011, the company received the rights to broadcast four Olympics in the United States. The contract value is $ 4.38 billion, $ 1.42 billion of which falls on the Tokyo Olympics. Later, the contract period was extended. It now covers the next seven Summer and Winter Olympics through 2032, and is worth $ 7.65 billion.


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