NBC's Olympics Deal With Facebook -- Or, The Deal That Wasn't

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The line that stood out to me in Tuesday’s New York Times write-up of NBC’s Olympics deal with Facebook was actually the sentence that declared it wasn’t a deal at all. It read: “Facebook and NBC Olympics executives said the arrangement was not an advertising deal, and they indicated that no money was changing hands.”

It’s enough to make the Social Media Insider ask, “What’s the point of that?”

Seriously, NBC is gaining access to the biggest audience on the planet, and it’s not paying bupkes? Get my stockbroker on the line! Facebook is guilty of financial malpractice! If the roles were reversed, do you really think NBC would do this out of the goodness of its heart?

Here are further details, which paint the deal as a quid pro quo:

• Facebook users will have access to exclusive NBC Olympics content.
• NBC will produce Olympic content based on stories that are causing a lot of Facebook chatter, using data from something called the Facebook Talk Meter.
• A daily Facebook Olympics poll will be featured on NBC.

As Facebook works to perfect revenue models, I find these sorts of, ahem, deals, really hard to fathom. It’s not because such cross-pollination is a bad idea, but because the profit motive, if it’s there at all, is extremely elusive. And, though these partnership arrangements pretend to be about an equal value exchange, they actually aren’t.

If the question were posed as to who needs whom more, the clear answer would be that NBC needs Facebook more than the reverse. Facebook isn’t exactly begging for users, while NBC is competing in a world where the Olympics aren’t as compelling as they used to be. Heck, the same Times post says that NBC doesn’t expect to turn a profit on this summer’s Games. NBC needs all the help it can get; fortunately, Facebook was willing to give it some, for free.

Sure, both parties can point to long-term ROI. Maybe more traffic to Web sites, which results in higher online ad revenue, or, in NBC’s case, higher ratings that, down the road apiece, result in higher TV ad revenue. I should also add that Facebook has done business this way for a long time; it only charges advertisers for actual ads on Facebook, not brand pages.

But, to put this Facebook/NBC into terms any network TV executive can understand, getting access to the world’s biggest online audience is worth something. That something is money.

Editor’s Note: Check out the agenda for our third Lake Tahoe Social Media Insider Summit, scheduled for Aug. 22-25.

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1 comment on "NBC's Olympics Deal With Facebook -- Or, The Deal That Wasn't".

1. Walter Sabo from SABO media
   

   commented on: July 12, 2012 at 4:40 p.m.
   NBC has never made money with the olympics, it's not why they do them. Facebook will make money selling the data of who watched and when and what else they did and probably sell that right back to NBC

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