(Source: David Gray/Reuters)
Unprecedented traffic quelled doubts and set records

The Olympics finally ended on Sunday and with it an impressive display of athletics that showcased the talents of athletes like America's Michael Phelps and Jamaica's Usain Bolt.  While the Olympics and technology are not something everyone thinks of as mixing, the two are surprisingly intertwined.  From Michael Phelps’ high-tech swimsuit to the amazing architecture behind the various stadiums, the 2008 Beijing Olympics were a marriage of science and media.

Perhaps the greatest impact on the tech industry is thanks to the unprecedented response to the record amount of streaming coverage provided by NBC.  NBC gambled big, scheduling in excess of 2,200 hours of live stream coverage to be available free of charge on its website.  It bet that enough viewers would turn in to make its advertising recoup the losses.

The result was an epic success, in many ways.  As of Saturday, NBC reported that it had received 1.2 billion page views and 72 million video stream views.  These traffic totals blew away the totals for the 2004 Games in Athens and the 2006 Games in Turin combined.  To put NBC and the Olympics' accomplishment in another light, NBC was able to offer 45 minutes of video coverage a day in its 1964 Summer Olympics.  This year it offered 3,600 minutes daily of content -- almost three days worth in a single day -- spread across several networks.

One result of this success is that the television rights for the 2014 and 2016 Games are expected to earn much more in bidding next year.  ESPN, who owns the sports section of ABC, already has said it will make a major bid on the rights to these upcoming games.

For this year, the biggest winner in terms of money is perhaps NBC, who owned the rights to this year's Games.  NBC was the exclusive source of online video and the only network able to use the official Olympic logo.  As a result it reaped big advertising profits.

However, internet search engine and news aggregator Yahoo may have trumped even NBC in terms of audience and advertiser revenue.  Research firm Nielsen Online showed that Yahoo was getting 4.7 million unique visitors a day at the Olympics’ peak, versus 4.3 million at NBC.  Jimmy Pitaro, the head of sports and entertainment for Yahoo, stated, "The demand that we’re seeing has far exceeded even our wildest expectations."

According to Nielson, other big winners included AOL, ESPN, Sports Illustrated, the Beijing Organizing Committee, The New York Times, and USA Today.  It said many people were drawn to these sites for their more diverse, entertaining coverage, compared to NBC's more straightforward coverage.

Regardless of whether it did the best or just very well, NBC learned a lot from the Olympic Games.  First, it claims that despite the record traffic, 93 percent of viewing was still done on television.  Secondly, it says online viewing was primarily used by viewers as a replay device.  Alan Wurtzel, the head of research for NBC states, "People want to catch up on events that they miss.  About half say that’s the main reason.  The second reason (about 40 percent) is that they want to resee and revisit the major events they had seen on TV earlier."

Also of interest, NBC found its internet traffic peaked at around noon, presumably when workers were on their lunch breaks.  Monday mornings also were strong performers, presumably due to office workers making up missed weekend coverage.

Exactly how much NBC made in its online endeavors is open to speculation.  NBC said that it could not be estimated as ads were sold across different platforms.  Research firm eMarketer, however, claims that the total revenue from NBC's online video ads amounted to $5.75M USD.  With NBC estimated to have made $1B USD in advertising for the games overall, this percentage seems remarkably tiny.

One way Yahoo won big was by cleverly circumventing NBC's rights.  NBC elected to not provide streaming coverage of the biggest events, such as Usain Bolt's record setting 200 m race, saving it to force viewers to tune in to its evening coverage to see video.  While some sites provided breaking news updates of the results early, Yahoo took it a step further, linking to video from out-of-country providers such as BBC.  This proved to be a major traffic generator for the site.  Compared to Turin, Yahoo says it tripled in traffic.

In years to come, coverage and advertising for the games, online and off will likely continue to grow, with over 80 percent of Americans on the internet.  However, the 2008 Beijing Olympics will likely hold a unique spot in the timeline of Olympics and the internet, as it will be the first year where online coverage started to really take off.

"There's no chance that the iPhone is going to get any significant market share. No chance." -- Microsoft CEO Steve Ballmer

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