Is This NBC’s Nightmare Olympics Scenario?

Photo-Illustration: Vulture; Photo by Peacock

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After a one-year pandemic delay, Americans are coming together this summer to participate in one of our nation’s favorite semiannual traditions: bashing NBC for its Olympics coverage. Less than a week into the Tokyo Games, early gripes have ranged from the usual annoyance over chatty commentators and those ever-abundant advertising breaks to more 2021-specific criticisms concerning the confusing ways in which NBCUniversal has divvied up events across its various platforms or the less-than-ideal user experience offered by newbie Olympics streamer Peacock.

And yet as bad as the cultural kvetching has been for NBC, the Nielsen numbers have arguably been even worse. Prime-time TV viewing levels on some nights are barely half what they were during Rio 2016, causing some advertisers to begin talking about compensation for lower-than-expected ratings. Throw in the premature exits of several star competitors (most notably Simone Biles) and it’s hard to argue the Olympics have gotten off to a storybook start for NBCU. But while it’s pretty easy to craft a negative narrative around week one of the Games, the truth about Tokyo is actually a bit more complicated.

How Bad Are the Ratings Really?

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For decades, Nielsen’s verdict on the Games was the easiest way for advertisers and journalists to judge whether or not NBC’s coverage was resonating with viewers. The network’s press releases bragging about huge tune-in practically wrote themselves, with total viewer numbers often cracking 30 million-plus for summer Olympiads as recently as London 2012. During the first 15 years of the 21st century, NBC’s summer Olympics numbers defied gravity, adding audience even as almost everything else on linear TV declined. That changed in Rio back in 2016, but even with a nearly 20 percent drop, those Games still pulled in an average prime-time audience of just over 25 million viewers. It’s too soon to say precisely where 2021’s ratings will end up, but the first few days of data suggest a decline north of 40 percent isn’t out of the question. The technical term for this kind of Nielsen performance is “yikes.”

No amount of spin can hide the fact that a big chunk of the audience has simply abandoned watching NBC’s carefully packaged prime-time presentation of the Olympics, and that this scenario is not what NBCU parent company Comcast had in mind when it committed nearly $8 billion back in 2014 to extend its hold on U.S. rights to the Games for another 11 years, until 2032. Execs can talk up “surging digital views” or “boosting signups for Peacock” all they want, and such talking points aren’t without some merit. Digital viewership for Tokyo is setting records, and those eyeballs are more monetizable than ever. But the simple fact is that TV viewership is still what drives ad sales, and turning a profit on the Games is undeniably a more difficult challenge when ratings take a dive. Comcast CEO Jeff Shell nonetheless Thursday insisted the company is “going to be profitable on the Olympics,” despite admitting some “bad luck” with how the competition itself has unfolded.

Whether or not Shell’s forecast proves accurate, Anthony Crupi, a veteran reporter on the advertising beat who now serves as sports media reporter for Sportico, tells me NBC’s prime-time Olympic ratings “are actually down a lot more” than folks on Madison Avenue expected, coming in well below the numbers the network guaranteed to advertisers. While that last part isn’t all that unusual — networks regularly overpromise audience delivery — Crupi wouldn’t be surprised if NBC had to start offering so-called “makegoods” to its clients. “I imagine that the likes of Toyota and Geico are going to be offered some freebies in Sunday Night Football,” he says.

But Is It Actually a Surprise? Acknowledging that these numbers are awful doesn’t mean you also need to buy into the notion that they represent some shocking disaster or repudiation of NBCU’s coverage. Fact is, anyone who pays attention to the linear TV ecosystem cannot at all be surprised at the ratings for Tokyo. Almost everything on traditional TV is pulling in numbers sharply lower than five years ago, with many programs and networks off by 30, 40, even 50 percent. And the pandemic has only accelerated the shift from linear to streaming, as locked-down or crowd-wary audiences have gotten more used to summoning programs on demand versus watching as scheduled.

Consider what’s happened to Thursday night network TV, for decades home to some of the medium’s most popular shows. On one night back in May 2016, new episodes of CBS’s The Big Bang Theory and ABC’s Grey’s Anatomy notched a 3.4 and 2.1 rating, respectively, in Nielsen’s all-important adults under 50 rating. Fast-forward five years to the same night in 2021, and the Nielsen wreckage is impossible to ignore: Big Bang replacement (and spinoff) Young Sheldon managed a mere 0.6 demo rating, while 16-year-old Grey’s was down to a 0.9.

So yes, the ratings declines for Tokyo are terrible. If things don’t turn around, ratings-wise, in the second half of the Games, I don’t think it would be melodramatic to describe these declines as NBCU’s nightmare scenario. But when the Oscars barely crack 10 million viewers and ratings for nearly every sport other than football continue to decline, well … it’s hard to be shocked anymore by Nielsen’s verdict. We simply live in a completely different TV universe than the one that existed during the last Summer Olympics.

A fair assessment of the numbers also has to take into account the slew of external factors completely out of NBCU’s control that have made it difficult to come out of the gate with any ratings momentum, including the lack of spectators because of COVID; the 13-hour time difference between Tokyo and New York; and the early disappointing performances of the U.S. men’s basketball and women’s soccer teams. What’s more, as bad as these early numbers have been compared to Rio and London, NBC’s prime-time TV coverage is still walloping everything else on linear right now. Its coverage is pulling in anywhere from two to four times more than the other major broadcasters combined. As Crupi puts it, “Compared to everything else on TV that isn’t spelled N-F-L, those are still some giant-ass numbers.”

The Peacock Factor

If NBCU deserves to be cut some slack on the ratings front, other aspects of its early performance are fair game for criticism. As noted earlier, there was a ton of early negative social-media chatter about the company’s Choose Your Our Olympics digital strategy. Folks who thought subscribing to Peacock would give then an all-access pass to Tokyo have been bummed to discover that, no, you still need to have some sort of subscription TV package (either cable or a service such as YouTube TV) in order to access all the events streamed on the NBC Sports app and its Olympics website. Similarly, cable customers who in recent years have been able to watch most big events live (either through authenticated streaming or NBCU’s cable networks) may be annoyed that Peacock got exclusive dibs on some big live events, including women’s gymnastics.

To be fair, Peacock never marketed itself as the home of all streaming coverage, and NBCU is hardly the first conglomerate to move programming once exclusive to cable over to streaming (think FX on Hulu). But some consumers have been rightly confused about when, where, and how to access live coverage of their favorite sports. What’s more, NBCU execs have said for more than a year that these Games would serve as a massive marketing platform for Peacock and that coverage on the service would help drive new sign-ups to the service. NBCU has certainly made good on promises to link the two, but I wonder if a lot of new subscribers have been disappointed to discover Peacock doesn’t actually deliver a one-stop solution to Olympics viewing and isn’t even the place to find the most live coverage.

It would have made all the sense in the world from a long-term perspective for NBCU to consolidate its digital coverage on Peacock. Unfortunately, the company’s very lucrative deals with cable operators may have made such a scenario impossible or at least financially unviable. Cable companies years ago negotiated higher carriage fees for NBCU’s networks knowing those cable channels would be packed with Olympics coverage and that cable subscriptions would be needed to access most streaming coverage, too. Simply putting everything on Peacock might have risked breaching past deals. Still, couldn’t NBC have figured out a way to tie cable subscriptions to Peacock memberships during the Olympics, allowing anyone with a cable login to sign in to Peacock the way they log in to the NBC Sports app? Maybe not: Cable operators, like local TV station affiliates, are so provincial it’s possible they simply wouldn’t even consider such an option. Or perhaps NBCU actually didn’t want to make things that easy, hoping that the lure of some exclusive Olympics coverage would be a better way to get previously reluctant cable customers (and cord-cutters) to finally sign up for Peacock.

Of course, it may be a good thing Peacock didn’t replace the NBC Sports app, since quite frankly, I’m not sure it could have handled hosting the full Olympics experience just yet. Having poked around both platforms the past few days, the NBC Sports app offers a speedier and far more user-friendly experience than Peacock, whose overall user interface remains less than ideal. (Don’t try rewinding a program on Peacock if you’re using Roku or Google TV; it’s a nightmare.) Still, for casual Olympics fans, Peacock does offer access to a ton of clips and highlights, as well as replays of dozens of events, and the overall presentation on the app (particularly the mobile version of Peacock) is decent. It certainly isn’t the disaster some of the loudest voices on Twitter suggest it is. And more importantly, it’s likely exposing millions of consumers to the platform, one of the major goals of NBCU’s Peacock Olympics strategy. (Whether those viewers are getting a good first impression is an open question.)

Maybe There Is No Winning

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Some of the complaining about figuring out “how” to watch the Olympics on the NBC platforms is a classic case of “be careful what you wish for.” After all, for years the rap on NBC’s coverage was that the network offered almost nothing but prepackaged, and often pretaped, extended highlights shows. Audiences would have to wait until prime time to see events which finished up hours earlier; sports fans who wanted deep coverage of less high-profile events were often out of luck. The fact that NBC now pretty much lets anyone with a cable login watch every event live, in real time, is a massive improvement over the status quo of a decade or two ago. And it’s certainly a lot better than it was back in the 20th century, when NBC — and previous Olympics hosts CBS and ABC — treated the Olympics as a prime-time soap opera, serving up only the story lines it felt would appeal to a broad audience (thank you, Roone Arledge). NBC still does this with its main coverage, of course, but audiences now have more choice than ever before.

Plus, while the whole Peacock/Olympics app thing is a tad annoying, NBC has scored far more serious Olympics blunders in the past. Back in 1992, for example, comics and critics were ruthless in their mockery of the network’s ahead-of-its-time (but still wholly awful) Triplecast scheme, which unsuccessfully tried to convince consumers to shell out up to $170 for a more complete cable viewing experience. In 1996, legendary Florida TV critic Hal Boedeker captured the cultural consensus that NBC had botched elements of its coverage of the Atlanta Games, seething over “the network’s sexist and condescending style,” particularly its decision to tape-delay the women’s gymnastics finals until midnight. And then there were the 2012 London Games, which birthed Twitter hashtags such as #NBCFail and #NBCSucks and had critic James Poniewozik comparing the network’s coverage to the business model of an airline, saying, “Its interest is in giving you the least satisfactory service you will still come back for.” Whatever the gripes about Tokyo, they seem modest compared to previous outrages — at least so far.

Is This NBC’s Nightmare Olympics Scenario?