Question

Los Angeles was the lone bidder for the 1984 Olympic Games in 1977 right after the 1976 Montreal Games that put the city of Montreal in a $1.5 billion debt which was not paid off until 2006. However, at the end of the 1984 Los Angeles Games, the total expenditures came in at a respectable $546 million, but even more impressive was the profit: A surplus of $232.5 million, meaning $93 million stayed in the region. One of the most important changes for this Games' success was the sport sponsorship and broadcasting right fees that were introduced to the Games organization by Mr. Peter Ueberroth, the CEO and Chairman of the organizing committee. The organizing committee, for example, sold the television rights to the broadcast to ABC for $225 million, raising a large amount of money far in advance of the games. Ever since then, the Olympics became a hot sought event by cities and nations around the world until recently. In 2017, the International Olympic Committee (IOC) unprecedentedly assigned the 2024 and 2028 Olympics, two games together to the cities of Paris and Los Angeles because of the lack of cities entering the bid to host the Olympic Games. Awarding the willingness of hosting the Games, the IOC has predicted it will contribute $1.7 billion of its broadcast and sponsorship revenues to Paris in 2024 and its contribution could jump to at least $2 billion by 2028 because of adjustments to the amount of sponsorship money L.A. would receive.

Discussion Prompt

Based on the knowledge you have learned in finance and economics in the sport industry and the information related to the Olympic Games’ finance and economics from at least five references/articles beyond the textbook (resources provided at the end of your discussion post) to explain what has not gone right with the Olympic Games’ finance and why cities around the world are no longer eager to become an Olympic City although the Olympic sponsorship still brings in a large amount of money and the Olympic television broadcasting fees has kept rising.

RUBRIC:

300 WORDS

Grammar, usage, spelling: The post contained 2 or less grammar, usage, or spelling mistakes.

Demonstrates knowledge of readings: Post makes 3 or more, related references and quotes the readings

Promotes Discussion: Post poses questions, invites responses, and responds back toposts. Post includes original ideas for consideration and response.

Connections: Post makes three or more clear connections to lesson(s) or other experiences.

Answer 1

The main problem with the Olympic games is the expenditure required to host the games. Ene before a city is slected to host the event, it has to undergo major infrastructural transformations in ordee to be considered for bidding. And ultimately when a city wins the uilding and is selcted to host the event, it requires an altogether different level of investement.

From high-quality stadiums reaching the number of 25-30 to the village for the participants and their teams. From television and broadcasting space to transportation and logistics solutions, all of these requires extensive planning and heavy investment. Not to forget the security which has to be provided to the participants as well as the visitors, the number of can reach up to billions of dollars. and in the end, the village and the stadiums built are no longer of any use to the city and needed to be regularly maintained to keep them intact which requires another level of maintenance finance.

All of these factors and considering the city doesn't earn much profit at the end of the event has lessened the appeal of hosting such an event and therefore, very few cities bid to host the event.