LONDON — It all started with some casual conversation over dinner at an Italian restaurant in Manhattan six months ago. It ended with an eye-popping $7.75 billion deal that will keep Olympic coffers flowing for another two decades.
By securing the U.S. broadcast rights to the Olympics through 2032, NBC tightened its grip on the world's most prized sports property. By awarding a new six-games package to the network, the International Olympic Committee scored a coup that bolsters its financial security.
NBC, which already held the rights through 2020, will have broadcast 17 consecutive Olympics by the time the new deal runs out.
Here are five things to know about the latest IOC-NBC agreement and what it means for the Olympic movement:
Money makes the rings go round
The IOC's financial stability relies heavily on U.S. broadcast rights fees and, once again, NBC was ready to help. Despite global economic pressures, the Olympics remain in high demand from TV companies. NBC has now shelled out a total of $17.9 billion for all the Olympics from 2000 through 2032.
"The games are very important pieces of media real estate for us in the United States," said NBC Sports Group chairman Mark Lazarus. The IOC also has reserves of more than $900 million and secured about $1 billion in global sponsorship revenues from the London and Sochi Games. The IOC distributes a large percentage of revenues to international sports federations, national Olympic committees and host city organizers. So some extra money could help alleviate concerns of potential host cities about the heavy costs of the games.
"This kind of deal is not only about money," IOC President Thomas Bach said. "Maybe in one deal you can make one or the other dollar more and afterward maybe have your product destroyed. We are thinking long-term in the IOC. We are here for 120 years and we want to be there much longer."
Feather in Bach's cap
The deal was a personal triumph for Bach, coming just seven months into his reign as IOC president.
Bach, who succeeded Jacques Rogge in September, came up with the idea of doing a long-term extension with NBC and led the negotiations himself. It was reminiscent of the days when former IOC President Juan Antonio Samaranch and Canadian member Richard Pound did direct deals with NBC and Dick Ebersol.
Bach is in the midst of pushing his "Olympic Agenda 2020," a series of changes and reforms that will be voted on by IOC members at a special assembly in Monaco in December. Having secured the landmark deal with NBC, Bach is in a stronger position to get what he wants. Still unclear is how the NBC extension will affect his proposal for the creation of an Olympic television network.
Keeping it secret
Almost as stunning as the deal itself was how the IOC and NBC managed to keep it under wraps.
It was at that dinner in New York in November where Bach floated the idea to NBC executives. More clandestine meetings took place during the Sochi Games in February. Then it all concluded Wednesday with handshakes and smiles and a contract signing at IOC headquarters in Lausanne, Switzerland.
In the IOC, Bach kept the process to himself and two close aides, director general Christophe De Kepper and marketing director Timo Lumme. Nothing leaked out before Wednesday's announcement.
"Sorry that we proceeded in keeping it secret, but it's also an expression of the excellent partnership that we've enjoyed (with NBC) and that we can rely on each other," Bach said.
The secrecy shut out NBC's rivals. There was no bid process open to all networks as there was in 2011. Bach said he saw no reason "to take any risk" with anyone other than NBC.
Time for U.S. in 2024?
Now that NBC has poured all these billions into the Olympics for the next 18 years, is it time for the United States to finally host the games again?
The Summer Games were last held in the U.S. in Atlanta in 1996. New York was rejected for the 2012 Olympics and Chicago was shot down for 2016. Broadcasting games from an American host city would be an obvious boon for NBC.
The IOC would also reap financial and other benefits from going back to the USA.
Bach said a U.S. bid for the 2024 Olympics "would be very much welcome" and would be a "very strong competitor." The U.S. Olympic Committee is planning to select two or three potential candidate cities by June and decide whether to submit a bid by the end of the year. Los Angeles, San Francisco, Dallas, Boston, Philadelphia and Washington are in the mix.
The IOC will select a host city in 2017.
Relief from Rio
After all the fretting over the construction delays threatening the 2016 Olympics in Rio de Janeiro, the NBC deal provided some much-needed good news for the IOC.
While Rio's preparations will remain an issue over the next two years, the agreement underlines the continued value of the Olympic brand at a time when it has come under severe scrutiny. The $51 billion overall price tag for Sochi has frightened off future host cities in several European countries. The race for the 2022 Winter Games is in disarray with three of the five bids — Oslo, Norway; Krakow, Poland; and Lviv, Ukraine — all facing serious political or economic uncertainty. Only Beijing and Almaty, Kazakhstan, are in solid positions at the moment.
Whatever happens, one thing is certain: The 2022 Games, wherever they take place, will be shown on NBC.