NBC Posts $223 Million Loss on Winter Olympics

The tally is in: NBC lost $223 million on the Winter Olympics in the first quarter.

That's slightly better than the most recent estimate of $250 million in losses. Advertising sales have improved a bit since NBC parent General Electric Co. made that projection in late January.

The Olympics did bring about $800 million in extra revenue to GE. But NBC had a lot of production and other expenses, including $820 million just to acquire the rights to carry the Vancouver Games on television and online. That expense was cited as the main culprit for the red ink.

Still, GE executives said the high-profile event had ratings that were 14 percent better than the 2006 Winter Olympics in Turin, Italy, for which NBC paid $613 million.

And GE Chief Financial Officer Keith Sherin said the Olympics provided a good platform to advertise its new 10 p.m. lineup and Jay Leno returning to "The Tonight Show" at 11:35 p.m.

Cable TV giant Comcast Corp. is seeking government approval to acquire a 51 percent stake in NBC Universal from GE. The Federal Communications Commission and the Justice Department are expected to approve the deal with conditions that are not yet known.

[jgg000101]

Here's the "other half of the story" that wasn't reported in this article. GE owns NBC. For all of you who think GE or NBC are getting stuck with a loss, it is actually us who are getting stuck.


GE: 7,000 tax returns, $0 U.S. tax bill
By Annalyn Censky, staff reporterApril 16, 2010: 11:52 AM ET


NEW YORK (CNNMoney.com) -- General Electric filed more than 7,000 income tax returns in hundreds of global jurisdictions last year, but when push came to shove, the company owed the U.S. government a whopping bill of $0.

How'd it pull off that trick? By losing lots of money.

GE had plenty of earnings last year -- just not in the United States. For tax purposes, the company's U.S. operations lost $408 million, while its international businesses netted a $10.8 billion profit.

That left GE (GE, Fortune 500) with no U.S. profit left for Uncle Sam to tax. Corporations typically face a 35% federal income tax on their earnings. Thanks to its deductions and adjustments, GE reported an actual U.S. federal income tax rate of negative 10.5%. It got to add a "tax benefit" of $1.1 billion back into its reported earnings.

[jgg000101]

by jgg000101 April 16, 2010 11:40 PM EDT
this is how jeff zucker keeps his job; by showing losses at NBC which allows jeffrey immelt and GE to pay zero taxes.

by alancontact April 17, 2010 1:37 AM EDT
What you wrote make no sense. So, you advocate losing money so that you don't have to pay money?

by independent_midwesterner April 17, 2010 4:58 AM EDT
jgg000101,

i think you are absolutely right. They sent all their corporates there pretending to be doing work, but they attended parties and events and pavillion showcases. Expensed it as a business expense and whamo the show is a loss. But everyone at GE had a great f888king time!! IN fact it was a great party at taxpayer expense. This happens everytime!!!

to alan--
GE is a global company that owns NBC (and will continue if the comcast deal doesn't fly). GE can turn a profit in every country except the US (which they did). And if there is no domestic profit shown, they don't pay US taxes. Considering the US has the 2nd highest corporate tax rate in the world, it is in their best interest to show a loss.

[jackp32]

$223 million loss. Could'nt happen to a nicer organization. Maybe bankruptcy is in their future.

[formrusmcsgt]

by John_Merritt April 16, 2010 9:21 PM EDT
I think the greatest problem with the Olympics over the past 20 years is they show very few 'real time' competitions.
---
I quit watching because it's 75% "human interest" stories, 25% competition.

Who cares if a curling competitor raised a squirrel hit by a car and such crap?

I don't.

[kevboom]

That is so true about the special interest stories. Who was that hag NBC sent all over the world... Mary something... digging up every sad sack story of athletes sacrificing their lives, money, and families for "the competition." The teenage figure skaters and gymnasts remind me of crazy pageant Moms stripping kids of their childhoods, yet the special interest stories somehow always seem to revere their "great sacrifice." Whatever...

[Henri_Rochard]

How many stinking promos did NBC show about some stinking animated movie where some kid trains a stinking dragon. What a waste.

I used to live in Seattle where we'd get Canadian network broadcasts of the Olympics. Obviously, they'd emphasize the Canadian athletes, but the coverage was much, much better than NBCs.

The whole Olympics is turning into a scam anyhow. They get the greatest athletes in world FOR FREE, the host cities provide all of the facilities FOR FREE, volunteers take care of facilities and even the drug testing FOR FREE...

[rickwar]

The real question is?

What's the definition of a loss?

There is "actual" loss and there there is "paper" for tax purposes. The 20 Mil loss is most likely "actual" loss. Production and "other" expense I'd be using a pretty sharp pencil there.

If you have production staff you are paying for normally then assign to production on this project and the reduce their production costs on another project---well you get the picture.

As to the Olympics, I watched this year more than years past. Might have been the awful winter weather we had here. Enjoyed it.

[tmittelstaed]

I was one of the legion of people who DIDN'T watch The Olympics. Why? To put it simply the Olympics isn't about amateur athletes competing anymore it's essentially about pro athletes. The event is way too slicked up now and after all the Olympic drug scandals it's just not possible to believe anymore that most of the athletes competing now AREN'T on steroids. The IOC saw what was going on in the pro sports with the steroid drug use over 2 decades ago and to argue that they didn't think the Olympic athletes would use performance drugs is just dumb. They knew and they turned the other way since it made for better ratings, and only paid attention to it when 3rd parties broke the story. The IOC also never punished Salt Lake City for their bribery to get the Olympics when they had it, so clearly the IOC is more interested in the money than in doing what is morally right.

I hope that next Olympics the IOC is unable to get any broadcast networks to pick it up unless they lower their fees. They have priced themselves out of the market. But I'll bet that it will end up on ESPN and become nothing more than a niche TV show.

[citizenusa-2009]

Oh, and the annoying fact that they have an inordinate amount of commercials to shove down our throats says it all.

[citizenusa-2009]

Wow, this and the Leno debacle should cause a shake up over there...I don't care either way because (after they screwed Conan), I no longer watch NBC.

[jgg000101]

this is how jeff zucker keeps his job; by showing losses at NBC which allows jeffrey immelt and GE to pay zero taxes.

[alancontact]

What you wrote make no sense. So, you advocate losing money so that you don't have to pay money?

[independent_midwesterner]

jgg000101,

i think you are absolutely right. They sent all their corporates there pretending to be doing work, but they attended parties and events and pavillion showcases. Expensed it as a business expense and whamo the show is a loss. But everyone at GE had a great f888king time!! IN fact it was a great party at taxpayer expense. This happens everytime!!!

[wheresmycountry]

Colbert called it.