While there was outcry of frustration over the lack of real-time video coverage during the 2012 Olympics in the United States, NBC brought in big ratings and advertising dollars. Even with the outcry of #NBCfail, NBC expects to break even with their prime-time model and possibly make a small profit, bringing in more in advertising than they did during the Beijing games. And the audience numbers back this. NBC averaged 31 million prime-time viewers a night, and over 200 million viewers overall – making this the most-watched non-US Summer Olympics in 36 years. However there is a more fundamental challenge at bay than a Twitter trend. The traditional model worked for NBC this time, but audience expectations have shifted with the advent of streaming video, forecasting a need for new broadcasting models to make future high-profile events available where, when, and how the audience wants to watch.
How We Used to Watch and the Changing Landscape
Until recently, US audiences accepted that Olympic games were provided by a single broadcasting network and its affiliates. It didn’t matter that the main coverage was available only at a few select channels and only through traditional television. It didn’t matter that we couldn’t easily browse content from our phones or tablets. But audiences no longer share a one-to-one relationship with their television sets for content consumption. In today’s connected era, audiences entertain themselves, research products, and create and share experiences through many connected devices and platforms to frequent as many websites and publishers’ applications as possible. The 2012 Olympics’ viewership aligned perfectly to the trend with staggering figures of 64 million videos streamed across all platforms in the first five days. This breaks down to 60% of video streams happening online, with 45% coming from a combination of tablets and smart phones (as covered in paidContent).
The Current Challenge
The challenge for US audiences was that content was only accessible through NBC and its affiliates MSNBC and CNBC. Other networks and publishers had to collect the crumbs by creating tear-jerking athlete background stories and overlaying analyst commentary on top of previously aired content. With an audience growing accustomed to access, content was not available everywhere they were expecting to watch. In the US, streaming online content was only made available to paying cable subscribers through NBC’s site NBCOlympics.com. So cord cutters or those with only basic television were left to watch NBC’s delayed and edited versions of the games or were completely left in the dark.
Social networks only add fuel to the fire. It’s impossible to not feel a little disgruntled when someone you’re following (e.g., friends and news outlets) shares the gold winner before you’ve even seen the race. And when NBC makes a gaffe, like showing images of Missy Franklin holding the gold on the Today Show before the competition had aired in the US, there’s no time to backpedal before the social media community lashes out. If the video content was available sooner and in more places digitally, it would have not posed a problem. In fact, this would have extended the reach NBC would have been able to give advertisers. Advertising through mediums beyond the television screen can produce more direct results and, in social environments, can create opportunities to “earn” media. Not to mention for NBC to provide this content to publishers other than their owned sites could have cultivated excitement for the Olympics in new audiences. For example, Olympic content provided on a teen entertainment site could have spurred younger audiences to tune in to prime-time airings and even embrace some of the sports themselves. Instead NBC focused their broadcasting model on content control, not growing the Olympics’ fan base or adapting to evolving consumption trends.
Solutions for a Better 2014 Olympics
Does this mean that the outcry of #NBCFail on Twitter should force NBC and the Olympics to scrap the existing model for one that’s completely democratic? – Yes and no. NBC didn’t suffer financially or in their ratings by sticking to the traditional model. As quoted in MediaPost, during the first five days of the game, household prime-time ratings were 10% above Beijing. And with NBC expecting to bring in at least $1.2 billion in advertising, up from the $850 million during the Beijing Games, it’s easy to understand their thought process.
However the decision by NBC Sports Chairman Mark Lazarus to not “deviate in future Games from its strategy of airing events on a tape-delayed basis in prime-time, when time differences are an issue” might prove to be a misstep. Not only did this model generate a PR nightmare, the adoption of connected devices is only expected to increase and become more engrained over the next couple of years. According to Cisco, the number of connected devices per U.S. household is expected to rise from 5.5 to 8.5 by 2016. With device adoption this high, it’s easy to predict a future where more cord cutters exist, opting for subscription services like Hulu and Netflix for their entertainment over cable networks, thus shrinking NBC’s margins. To stay competitive, NBC should consider sharing portions of content with popular subscription services because more eyes equals more potential for advertising dollars, as well as expanded reach.
If NBC chooses not to adapt, it might be wise for the Olympics to keep prime-time broadcasting with NBC, but license online coverage to intermediaries who can generate further revenue and increase enthusiasm for the event by making content available across the digital space (much like PGA's and Turner's June breakup). It’s not impossible to imagine audiences paying a small, one-time fee for access to online content or supporting the service with ads, thus avoiding much of the PR backlash for excluding certain viewers. It’s doubtful NBC will lose many prime-time viewers, even with the added competition. Because, really, who doesn’t want to pull out a tissue or two for heart-wrenching back stories of Olympic hopefuls and their rise to glory? Everyone loves a good story. Regardless of the specifics, the 2012 games have forecasted a 2014 audience that’s going to be even more connected and demanding of content everywhere. And when the audiences are finally happy, everyone in the arrangement wins.