Yesterday, Comcast Corp. (CMCSA) received a shot on the arm. NBC Universal, which is controlled by Comcast, has won the U.S. telecast right for the 2014 and 2018 winter games and the 2016 and 2020 summer games. The International Olympic Committee conducted an auction for these four game events. NBC Universal outbids its cossets rivals such as ABC and ESPN networks controlled by Walt Disney Co. (DIS) and Fox network controlled by News Corp. (NWSA).
NBC Universal will pay a total consideration of $4.38 billion for these four Olympic games. The payment distribution will be $775 million for 2014, $1.226 billion for 2016, $963 million for 2018 and $1.418 billion for 2020 games. NBC Universal is the U.S. broadcaster for summer Olympics since 1988 and winter Olympics since 2002. Comcast has decided to spread the coverage of these sporting events across its cable and broadcast networks as well as its digital outlets.
Comcast expects the deal to be profitable. An improving U.S. economy resulted in the revival of the advertising market. The company further hopes to increase fees of cable operators and TV stations. Several industry analysts believe that by acquiring Olympics TV rights, NBC Universal may uplift Versus Cable sports network as a major national sports channel capable to take head on with ESPN.
Comcast has become a media baron after completing the acquisition of majority stake in NBC Universal. Some of the TV channels of NBC Universal has worldwide acceptance. At present, Comcast turned out to be a highly diversified entertainment house, offering cable-TV/faster Internet connectivity, producing rich TV entertainment and film contents and operating a series of theme parks.
Recently, Comcast has entered into an agreement with private equity firm Blackstone Group to purchase the remaining 50% stake of Universal theme park in Orlando for nearly $1.025 billion. Comcast, which is known for highly efficient management tactics, is trying to revamp NBC Universal’s sports channels with exciting contents to collect hefty fees from cable operators.
COMCAST CORP A (CMCSA): Free Stock Analysis Report
DISNEY WALT (DIS): Free Stock Analysis Report
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