NBC Belly Flops Olympic Games Online Video Initiative

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By: Matt Clark

According to the Wall Street Journal, NBC failed to hit its revenue goals with their Olympic web-videos. eMarketer estimates that NBCOlympics.com will only generate $5.75 million in video-ad revenue from the Olympics.

NBC went wrong in a few places. For one, they only aired a few events over the Web. This obviously limited ad revenue and viewership. But I don’t think this is the biggest concern. NBC tried to run a web-based video model but ignored what makes web-based initiatives successful: openness.

NBC blocked all of its video from going viral on all other sites. They shut down videos on YouTube and MySpace. They blocked direct video downloads and they had an incredibly annoying registration process.

The first time I tried to log on I got blocked from the site. I was ready to rip NBC right there, but took some time to relax. The registration process was absolutely annoying. I tried to register using my home address, but the site knew I was in New York and was trying to claim a New Jersey cable company. After a few more failed attempts, I received a message window that informed me that I was blocked for 24 hours for trying to register too many times. If I didn’t want to see Phelps kick butt, I would have given up right there.

I understand that NBC wants to show demographics to advertisers to increase their ROI, but they went too far. I am sure this process cost them a few million viewers.

Next, they only used one distribution method and blocked all YouTube videos. Again, I understand what they were trying to do. They wanted to own the content. But they went against what the Web stands for. People want free access to content over the internet using multiple channels. YouTube is everyone’s first stop. NBC could have used this to their advantage by uploading content to YouTube themselves, embedding ads, and directing viewers to NBCOlympics.com. This would have increased traffic and made sport fans happy. Instead, I was upset that I was limited by NBC. Why would they want to limit the nature of their own video content?

NBC took a great idea and killed it. If they made the process easier, they could have raked in a few more millions. When utilizing digital marketing efforts, you need to go with the predetermined process, not try to contain it.

NBC should have taken a lesson from CBS Sports. During NCAA’s March Madness basketball tournament, CBS made about $23 million in ad revenue. They had no registration requirements and allowed videos to be distributed over multiple channels, so viewers could choose their preferred method of viewing. CBS was so successful, they are trying to use this model through out the season, with all sports.

The bottom line is that NBC was, to some degree, pretty successful. This was the first time that a network tried such an extensiveonline model during the Olympics. But they also screwed up. Digital marketing is about using your customers preferred communication method to reach them. “THE INTERNET” is not a preferred communication method. It’s an umbrella for millions. Why do I have a feeling some old guys in a big NBC office came up with the idea of “using the power of the web,” but had no idea what that meant?

These larger companies need to use the communication channels the internet has to offer. Otherwise the smaller, faster, younger companies will beat them out in the end.