Phelps factor has Olympic marketers excited

Improved ratings for the Beijing Games, driven by Michael Phelps's success in the pool, may push up rights fees from broadcasters including NBC Universal, the International Olympic Committee's top marketing official said.

NBC, a unit of General Electric Co., paid $894 million for U.S. rights to the Beijing Olympics. The Games are attracting 21 percent more viewers than four years ago in Athens, partly because of Phelps's bid for a record eight gold medals, NBC said in a statement Thursday.

"We can capitalize on that in the next negotiations with NBC for the new rights," Gerhard Heiberg, chairman of the IOC marketing commission, said in an interview. "This is good for us. Yes, we may reach a higher level."

Average U.S. viewership for the first five days of coverage was 31.3 million, compared with 25.8 million for the same period in the Athens Games, NBC said yesterday.

NBC holds the U.S. rights through the 2012 Games in London, for which it paid $1.2 billion. NBC Sports spokesmen Adam Freifeld and Brian Walker didn't immediately respond to e-mails seeking comment on Heiberg's remarks.

Heiberg also said some of the Chinese sponsors of the Beijing Olympics Organizing Committee are considering becoming IOC sponsors, without naming any.

Twelve so-called TOP sponsors, including Coca-Cola Co., General Electric Co., McDonalds Corp. and Johnson & Johnson, paid an average $72 million over four years for global advertising rights to the Torino and Beijing Olympics.

China National Petroleum Corp., Air China Ltd. and China Mobile Ltd. are among the eight main Beijing sponsors, giving them rights to tie their products to the Olympics within China. TOP sponsors can use the five-ringed logo globally.

Of the 12 TOP sponsors, Lenovo Group Ltd., Manulife Financial Corp. and Eastman Kodak Co. are ending their agreements after the Beijing Games, with Taiwanese computer maker Acer Inc. having signed up to replace China's Lenovo.

Heiberg said it was a "normal rotation".

"It's good that some companies leave, not too many, but we get some new ones," Heiberg said. "We're having room for two to three more sponsors. So it's good that we're having companies approach us to discuss the possibility of becoming a TOP sponsor."

The global economic slowdown may make it harder for the Olympic committee to find replacements, said Michael Stirling, commercial director of London-based Global Sponsors Ltd..

"There are a limited number of companies that can justify spending at least $25 million a year over four years," Stirling said in a telephone interview. "The issue is whether the costs of acquiring those rights and then activating them represent the best value for money."

IOC President Jacques Rogge said this month that he expects Olympic sponsorship revenue to increase about 16 percent to $1 billion for the Vancouver 2010 and London 2012 Games. He also predicted a 40 percent rise in broadcasting revenue for the 2009-12 cycle, to more than $3.8 billion.

Phelps won his sixth gold medal in Beijing today to move within two of breaking Mark Spitz's one-Games record set in 1972. He also advanced to a record 12 career gold medals.