Nobody thought for a moment that Discovery had acquired the European TV rights to the Olympic Games (for the 2018-2024 event) as a philanthropic gesture, but David Zaslev, Discovery’s president/CEO told analysts that the TV rights, bought for €1.3 billion via its Eurosport channel, would make money for the broadcaster.
Zaslev, speaking after unveiling Discovery’s results, said the company’s expansion into sport via Eurosport was well under way: “We have been on a journey to revitalise the brand with locally relevant sports rights and programming. And we are realising the potential of this cash flow positive business and we’re starting to see meaningful results, including double-digit growth all across Europe. And we’re leveraging the power of sports programming by driving meaningful affiliate value across our whole portfolio, which you will see grow further in the years ahead.”
As to the Olympics, Zaslev said: “We continue to monetize our Olympics investment by signing sub-licensing deals in The Netherlands and Finland, which followed our deal with the BBC in the UK. These agreements significantly exceeded our plan. We have retained all rights to the Olympics on all platforms so that we could pursue incremental value and deals on mobile, on social media with players like Facebook Live and Twitter or going direct to consumer on our Eurosport app. The Olympics will not only be profitable, but based on the deals that we’ve done already, we expect the Olympics will make real money for us on each of the games.”
Discovery said it expected “meaningfully positive cumulative Olympic-related cash flows through the 2024 games. We forecast that aggregate revenues from this deal will significantly exceed total costs.”