Discovery’s $1.5 billion Olympics deal results in uneven free-to-air coverage across Europe

When Discovery Communications purchased the European rights to the 2018-2024 Olympics six years ago, ousting competitors such as the European Broadcasting Union (EBU) and agency SportFive in the process, there was little public interest, let alone outcry.

Discovery had bought the pan-European network Eurosport in 2014 and were keen to make a mark with their new acquisition. So ponying up €1.3 billion ($1.5 billion) to ensure the network had exclusive rights to broadcast four Olympic Games across 50 countries in Europe probably seemed like a good deal — especially when compared to the $12 billion that NBC paid for the U.S. rights to broadcast 10 Olympic Games through 2032.

“[If] you compare that to what’s paid in America by NBC, it’s a fraction of that,” said a senior broadcasting source who agreed to speak on condition of anonymity. “[Discovery] are also an American organization, so obviously this looks like a good deal.”

Six years later, however, both audiences and the International Olympic Committee (IOC) are reckoning with the repercussions of that deal as major European territories, such as the U.K. and Italy, realize all too late that it has resulted in severely limited free-to-air coverage of Tokyo 2020.

While the IOC guaranteed 200 hours of free-to-air coverage of each summer games as part of its deal with Discovery, the key issue for European viewers is how many Olympic events are available to watch live and when, which is now dependent on the sub-license each territory has been able to wrangle with Discovery.

In Italy, much to viewers’ consternation, state broadcaster RAI doesn’t have streaming rights and has resorted to cutting between events. In the middle of an Italy-Greece male water polo match, for example, RAI2 cut to the canoe female slalom final, where Italy was also competing, causing a social media uproar.

In other cases, RAI2 have found themselves broadcasting events where no Italians are participating at all.

“Right now in Tokyo a Japan/Italy softball match is taking place….but RAI is airing the 100 meter breaststroke where no Italians are competing,” a softball fan lamented on Facebook.

In the U.K., where the BBC has been capped to only two live feeds (one on television and another on digital), The Guardian reported the BBC had received “a large number” of complaints about the limited coverage. “As the BBC is no longer able to offer live streams of every sport we often have to make difficult decisions about which sports to show live and which to show on delay,” the corporation said in a statement responding to the complaints. “Priorities may shift as live events unfold, and so, while we will do all we can to keep all viewers happy, we might need to jump in and out of sports to ensure we bring as many of the big moments as possible.”

Fans are particularly irked by the lack of options because, during the London 2012 and Rio 2016 Olympics, the BBC negotiated directly with the IOC, resulting in a plethora of simultaneous live feeds available to viewers, who then had the pick of which events to watch.

According to a source with knowledge of the BBC’s 2016 negotiations with Discovery, the corporation was under tremendous pressure during talks because Discovery threatened to hand the rights to ITV instead. For the BBC, who have broadcast the Olympics since Rome 1960, losing the games would have been disastrous.

By contrast, the German media landscape was such that Discovery had little leverage. At one point, German public broadcasters ARD and ZDF walked away from negotiations entirely before eventually returning to the table and securing 350 hours of free-to-air rights across TV, radio and Internet.

Ireland’s RTÉ, however, secured only 270 hours on one linear channel.

Meanwhile, France Télévisions have the free-to-air rights to 650 hours of the Tokyo games across three different channels and as many as 3,600 hours of programming on digital, including up to 30 simultaneous live streams.

The unintended result of the Discovery deal, therefore, has been a patchwork of uneven coverage across Europe (some Italian viewers have become so frustrated by RAI’s coverage, they have resorted to watching Austrian TV, which they get on their terrestrial digital receivers.) “The fragmented sports rights landscape is not good news for fans and viewers alike,” said Paolo Pescatore, a tech, media and telco analyst at PP Foresight.

By contrast, said the broadcasting source, “if the EBU bought the rights collaboratively with its members there is no question that the BBC and others would have more control over what they could show. The big question is would they be prepared to pay more for more control and, if not, where is the value for a partner?”

(On the other hand, even wads of cash doesn’t guarantee you good reviews, as NBC has learned. Despite offering expansive Olympics coverage across dozens of networks and platforms — including NBC, the Olympics channel, the USA channel and the Golf channel — some U.S. viewers have expressed dissatisfaction over NBC’s lack of depth and curation rather than breadth.)

For both Discovery and IOC, meanwhile, the deal may not be as fulfilling as it first seemed, either. Although Discovery are believed to have already recouped much of their €1.3 billion by selling the free-to-air rights to local broadcasters (meaning the remainder of the outlay for the exclusive pay TV rights works out to be a comparatively good deal), “It is difficult to work out where the value is for Discovery/Eurosport,” said the broadcasting source.

“With the main events largely available on free-to-air channels, they will not perform well on linear when competing with traditional European channels, so the value will be decided by their digital numbers.”

Certainly in France, where France Télévisions has significant free-to-air rights and Canal Plus is a more popular pay-TV group with more subscribers, it is questionable whether there will be much benefit for Discovery.

“The Olympics is a once in a lifetime opportunity to further drive subscriptions, engagement and, more importantly, revenue,” said Pescatore. “So far, it feels like Discovery has done a poor job of articulating its streaming offering, not supported across all devices like rivals and an inferior user experience.”

Equally, the patchwork free-to-air coverage across Europe is not great news for the IOC, whose sponsors will already be reeling from Tokyo 2020’s lack of live spectators due to pandemic restrictions. And then there’s the fact that the IOC’s stated ideals are “a spirit of friendship, solidarity and fair play.”

“The question is, is the Olympics not supposed to be kind of a bringing people together, unifying the world through sport?” said the broadcasting source. “In order to do that you need to make it accessible to all.” Variety