Sports TV
NBC's big struggle: Those last TV ads
By Kevin Downey
Jul 23, 2008 - 8:51:17 AM

The good news for NBC, with just three weeks to go before the Summer Olympics, is that it's sold 90 percent of its ad inventory.

The not-so-good news is the remaining 10 percent. Media buyers say demand is sluggish and a good chunk of these spots will likely remain unsold when the Games begin airing on Aug. 8.

That's not such a terrible thing for NBC. It will still likely reach its goal of $1 billion in ad sales, and it's probably already recouped its $900 million investment in the Games. And that's in what's an all-around rough ad economy.

Still, the network will be busy these coming weeks selling off what it can, and with fewer and fewer prospects to mine. Advertisers that wanted to be part of the Games booked early on NBC, its cable networks and web sites.

But many who might otherwise have signed on have held back, their ad budgets cut back as they struggle with declining revenue.

"The economy is certainly a factor,” says one buyer. “You can have an advertiser that is looking at how they can spend that money elsewhere. The Olympics costs a lot, and that holds true for a lot of big events.”

A 30-second Olympics commercial on NBC is reportedly going for about $750,000.

And even if NBC should cut prices, potential advertisers will be weighing whether it would make more sense to spread what they would pay for one Olympics spot over a couple of weeks on less-costly programming.

Another problem NBC is facing, perhaps a bigger one, is the sheer amount of inventory it has to sell. NBC, its cable outlets like USA and related web sites will air 3,600 hours of coverage, more than all previous Summer Olympics combined. Of this, 2,200 hours will be online.

Some of this inventory costs far less than spots on NBC, and that's helped lure in some advertisers who could never afford an Olympics spot on NBC. But it also means NBC has to work that much harder than it has in the past to sell spots, and that’s proving to be a problem.

“They have more inventory than they’ve been moving,” says this buyer. “They just have a lot more to sell.”

Another concern is continuing news reports about China.

For months the media has focused on its government’s harsh treatment of some survivors of the recent earthquake, which claimed the lives of tens of thousands of people.

China has a long history of human rights abuses. And it’s frequently criticized in the press for its suffocating air pollution and its aggressive hold over neighboring Tibet.

Some of these concerns have been waning in recent weeks as upbeat stories from the Olympic trials, such as swimmer Michael Phelps breaking records, have taken the spotlight away from the Chinese government.