Be it fair or otherwise, the world often holds an unflattering stereotypical image of your average American couch-potato sports fan. Images are conjured up of a bloated character, remote control in one hand, the other clutching at nachos and popcorn, most of which ends up on his stained Dallas Cowboys T-shirt. By his side stands a ten-gallon drum of diet Coke. But rather than poke fun at this caricature, the sporting world should celebrate him and his ilk as a hero, for over the past few decades it was these very people who bailed out the Olympic movement. The whole world loves the Olympic Games, but the American guy with the zapper pays the bulk of the bill.
Rewind back 21 years to 1984 when Los Angeles hosted the games that the International Olympic Committee could hardly give away. The movement was struggling and the Olympics were the party everyone thought was a good idea but no one wanted to host. Boycotts were still in vogue after the US and its friends had stayed away from Moscow four years previously. Montreal, the 1976 host, was still stinging from the US$1.5 billion debt they had been lumbered with.
The modern games had only made a profit once before - also in LA back in 1932 - and the Californians once again put in an Olympian display of business acumen and wrapped up with US$230 million to spare. They took in an unprecedented US$287 million in broadcasting revenue and showed sponsors how to get more bang for their buck. The movement has not looked back since. By Sydney in 2000 the games were generating US$1.3 billion dollars from TV rights, and Beijing is expected to hit a record US$1.7 billion. Of that figure, almost US$900 million comes from NBC for the rights to broadcast to the American market.
The US contribution is driven up by fiercely competitive domestic auctions as the networks clamour for ratings. Similarly, in the upcoming winter games in Turin, NBC paid US$613 million for the US rights, while the European Broadcasters Union only paid US$135 million. Not a bad deal for the Europeans you might say - they pay a fraction of what NBC pays yet their audience is more than 50 per cent larger than the US audience. But even though NBC pays through the nose, they can still turn a small profit on the games thanks to their enormous advertising market.
And with just shy of four billion viewers tuning in to the summer games, the sponsors are quick to line up these days too. But it hasn't always been so easy. The Olympic Programme (TOP) worldwide four-year sponsorship deals has only started to rocket lately: the first programme in Seoul in 1988 only made US$96 million, Atlanta hauled in US$279 million in 1996 and Sydney hit US$579. Beijing has topped all records by netting US$866 million.
With the International Olympic Committee now generating revenues of US$4.2 billion dollars in a four-year cycle, people have been jumping up and down all over the world condemning the over-commercialisation of the movement. Valid concerns, indeed. And there is no doubt that at several junctures along the way the integrity of the games and the athletes will have to be battled for. But there is an upside that cannot be ignored either. Of all that money raised, 8 per cent goes to the administrative costs of running the IOC. The remaining 92 per cent goes into running the games and funding athletes around the world and their associations.