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Banned from the Olympics
- — 16 August, 2000 10:31
Net firms have not been shy about spending money, but even they can't buy into this exclusive club. Beyond that, Olympic sponsor IBM, which is shelling out $343.3 million in money and services for Sydney, landed the gig for producing Olympics.com, a job that ordinarily in the sports world goes to an online media outfitThe Internet's greatest advantage - its capability to cheaply beam content to any computer anywhere in the world - is the same reason it's being so highly regulated by the IOC. The IOC understands that through the Net more people can access the Games. But if it's at the risk of jeopardising its billion-dollar TV-rights deals, forget it. "We're torn between those two streams of thought," says the IOC's Pound.
A major obstacle to watching the Olympics on the Web is the inability to confine the broadcast to a region - which is the very basis of the TV contracts. A Web broadcast creates the prospect of viewer choice, a scary proposition for TV programmers. If you give the viewer the choice to watch the games on something other than TV, then TV ratings would fall, advertisers would insist upon paying less and the price for sponsorships and TV deals could plummet, so the thinking goes. Scarier still for network executives is the scenario in which there are multiple official sites competing for the same advertisers. For instance, Sydney is the first Olympics in which NBC is in competition with the host city to find advertisers for their respective Web sites. And organisers of the Salt Lake City Winter Olympics in 2002 are promising a better site, with more advertisers. Unless a decision is made, the IOC is facing the prospect of having the 199 national Olympic bodies, which now subsist on IOC contributions, launching fledgling Web businesses to help pay for their athletes' training. Pound says he won't stand for it. "I would be nervous if you had organising committees selling [advertising] on their own," he says. "They might sell it to competitors of their own sponsors or something like that." But dot-coms see opportunity in the turmoil. "It's like everything else in life," says Jessiman of Sports.com. "You have to ask yourself: Do you fear the Internet or embrace it?"
The IOC has scheduled an historic summit in its hometown of Lausanne, Switzerland, in December to address the Net. The top executives in sports, media and the Internet will have their say. "Where we are with the Internet is we're at a crossroads," says David Aikman, group marketing manager for the IOC assigned to the Internet task force. "The reason we called this conference is we're all trying to figure this thing out."
There's a lot to be sorted out. For instance, NBC and the IOC differ over whether Olympic Webcasts are included in the Peacock Network's $6 billion TV contract, a deal that expires following the 2008 Games. If NBC has the Net rights sewn up, which it believes it does, then the dot-coms may not have much to talk about in Lausanne. And NBC is committed to protecting that investment.
"It's really difficult to predict what the future is going to bring," says Gary Zenkel, senior VP of marketing and business development for NBC's Olympics coverage. "Right now the Olympics garners a premium in both rights fees and ad buys because it is able to attract and sustain an enormous TV audience. Until that audience and those advertising dollars are diverted to other [media] platforms, we will not in any way compromise the value of the exclusivity of TV."