Meet The Secretive Group Earning $8 Billion From The Olympic Games
Formed to promote "Olympism," the International Olympic Committee doesn't get rich off the Games, but they do enjoy themselves.
The 109-member Committee gets wined and dined by cities and corporations bidding for contracts, and they get treated like royalty at the Games.
Several times they've been caught taking bribes, but generally what happens in Switzerland stays in Switzerland.
The Committee is conveniently located in tax haven Switzerland.
"The tax exemption is very important. I have no concrete figures on how much we save in dollars and cents. But the tax exemption means that we can spend even more money on our Olympic solidarity work," said IOC member Gerhard Heiberg in an interview with Danish newspaper Information.
What's more, bribery was basically legal in Switzerland until recently. Stronger anti-corruption laws are finally coming into place after another bribery scandal at the IOC and FIFA resulted in almost no convictions.
Count Jacques Rogge leads a group of 109.
The Committee, which can hold up to 115 members, is composed of royals, nobles, CEOs and Olympians. Since Rogge took the helm in 2001, it has opened up to a larger number of Olympians. Still the IOC's co-option method of selecting members ensures that it remains an elite group.
Royals include Prince Faisal bin Al Hussein, Frederik, Crown Prince of Denmark, Princess Haya Bint Al Hussein, Sheikh Tamim Bin Hamad Al Thani, Prince Nawaf Faisal Fahd Abdulaziz, Prince Ahmad Al-Fahad Al-Sabah, Anne, Princess Royal, Prince Albert II and Princess Nora of Liechtenstein.
Members get many perks ... and sometimes too many.
Committee members also get treated like royalty (which some of them are) during the Olympics, hobnobbing with VIPs, being driven around in limos to five-star hotels, drinking $30,000 bottles of Hennessy and getting front row seats and unfiltered live TV access.
Several times this treatment has crossed the line. The most notorious case was in Salt Lake City, which won the 2002 Winter Olympics in part through bribery. It was revealed that IOC members received millions of dollars worth of gifts, trips, scholarships, plastic surgery and jobs for family members.
The scandal led to the resignation of the two heads of the Salt Lake Olympic Committee and several IOC members.
Selling media rights earned $3.91 billion this quadrennial.
Sportcal attributes the remarkable rise to:
- Emerging TV markets, especially China, which paid $99.5 million for TV rights to the London Games
- Increased competition in already powerful markets like the U.S., where NBC paid $2 billion
- The increasing role and market for broadband and mobile rights
- The added marketability of London and its time zone congruence with many of the Olympic games largest markets
Summer is worth about twice as much as winter, but the two are sold together.
International sponsorships earned another $957 million.
Eleven companies paid to join this prestigious group, including McDonald's, Coca-Cola, Proctor & Gamble, Ator, Atos Origin, Dow Chemical Company, General Electric, Omega, Panasonic, Samsung Electronics and Visa.
An estimated $3.1 billion was raised by Summer and Winter Organizing Committees
Another $989 million was raised in 2010 by the Vancouver Organizing Committee.
Organizing Committees put on the Games with this money plus funding from the government.
That's $8 billion in revenue in four years.
Where does the money go? Around 10 percent ($800 million) pays for operations at the IOC.
Around 70 percent ($5.56 billion) goes to the Summer and Winter Olympic Organizing Committees
The larger and more popular Summer Games receive a larger share of the money.
Fun fact: Mitt Romney was the CEO of the Organizing Committee in the 2002 Salt Lake City Games.
The remaining ~ 20 percent ($1.6 billion) goes to athlete organizations
(Photo by John Moore/Getty Images)
The US Olympic Committee receives more than other Olympic Committees since US media rights bring in by far the most revenue. Poor National Olympic Committees also receive extra money through the Olympic Solidarity program.
Not much goes to the athletes.
Malaysia promises $600,000 to any gold medal winner in the form of a gold bar, though they haven't won one since 1956.
The real money for athletes is in endorsements. Lochte is expected to take home around $2 million is endorsements from these games. Unfortunately most athletes aren't famous enough to earn much if any from endorsement deals.
Who benefits from the Olympics?
(AP Photo/Themba Hadebe)
The bottom line is that we all enjoy the Olympics.
Count Rogge and his friends just enjoy it a little more.