The Olympics: Scandal? What Scandal?

Sponsors aren't fazed by allegations of corruption

Given the scandal swirling around the 2002 Salt Lake City Winter Olympics, you might think sponsors are pulling out. Think again. No sponsors have withdrawn, and International Olympic Committee Marketing Director Michael Payne says he's seeking new ones and will raise the average sponsorship fee from $40 million to more than $50 million. NBC says sales of television ads for next year's Sydney Games--at $600,000 for 30 seconds--are running ahead of schedule.

The IOC will convene for a special session on Mar. 17 in Lausanne, Switzerland, to expel personnel implicated in bribery schemes. And the question of when and how to replace 78-year-old Juan Antonio Samaranch, who has run the games for 19 years, could also come up--if sponsors and broadcasters insist.

Networks such as NBC, which paid $705 million for the Sydney Games, account for about half the IOC's revenues. The 11 worldwide sponsors provide 36%. But backers aren't forcing the issue. A poll by Eisner & Associates says only about a third of Americans are even aware of the controversy and almost none blame the sponsors. "To this point, the problems have all been about executives and officials," says Dick Ebersol, Chairman of NBC Sports. David F. D'Alessandro, president and CEO of John Hancock Mutual Life Insurance Co. initially criticized the IOC and canceled negotiations for $20 million of ads. But now he says he is satisfied that the IOC is taking steps to reform itself.

Sponsors are keeping their eyes on the prize--a massive global audience--hoping the imbroglio will pass as scandals in other sports have. "The Olympics should have no problem," says David Grant, managing director of Clarion Sports & Entertainment in Greenwich, Conn. At least not where sponsors are concerned.

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