Comcast's NBC could profit from Olympics
Despite countless bad reviews, the cable company might just make a little money from the Games.
Entertainment products and services provider Comcast's (CMCSA) NBC unit said last week that there is a chance the company will make some money from its Olympic coverage, despite receiving a large amount of criticism.
During a conference call last week NBC Sports Group Chairman Mark Lazarus said, "We think there's a small chance that we could make a little bit of money."
This is despite the fact that some of the reporting and feedback online has been scathing. On Twitter, users post with the hashtag #NBCFail.
However, despite the widespread criticism, the New York Times is reporting that ratings are higher for this Olympics than they were four years ago for Beijing 2008. In fact, a predicted loss of $200 million has been turned around, and cautious predictions of breaking even or even making a small profit are flying around.
"We have ongoing sales interest from people who have sort of caught the fever of what's going on out there and have contacted us about buying more inventory," Lazarus said.
It seem ridiculous now that those $200 million loss predictions were ever out there to begin with. After all the Olympics is one of the biggest sporting events in the world. London provides a beautifully historic backdrop, so there is much to interest the average American. Even fencing and gymnastics seems interesting when the Olympics rolls around (though not for one minute during the four years in between).
Nearly 36.8 million viewers tuned in to watch Michael Phelps win his third consecutive gold medal and Gabby Douglas win a gold medal in gymnastics on Thursday evening.
"It is clear the audiences are coming in droves and staying and returning night after night," said Lazarus, labeling the network's performance as "a very pleasant surprise."
It certainly is a surprise, but try getting the average American to watch swimming in a few months' time. That is the magic of the Olympics, and that is why the predictions of massive losses were so surprising to begin with. People will watch literally any sport during this competition, as long as they can cheer on their nation.
"We are way ahead of where we thought we would be," CEO Steve Burke said during a conference call, obviously relieved after paying $4.38 billion to carry the Olympics through 2020. He added, "We feel it's clearly something that's going to benefit our company very broadly."
A little bit of profit has a way of making the world seem a lot brighter.
On Monday, Comcast traded at about $34.60, up roughly 1.5%.
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The solid report comes a month after the retailer closed all of its Canadian operations.
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