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Reinventing the rings
Sydney Summer Olympics depend less on commercial sponsorship, more on responsible financingBy David Armstrong
OF THE EXAMINER STAFF
Saturday January 10, 1998
SYDNEY -- How do you reinvent a century-old institution? Sydney hopes to find out by September 2000, when it hosts the Summer Olympic Games, the world's largest, most celebrated and logistically daunting sporting event.
Right now, the eyes of the world are turning to Nagano, Japan, where the Winter Games get under way next month. The much bigger, splashier and costlier Summer Games dominate the Olympics movement, however, and while the Sydney Summer Games are still two-and-a-half years off, the run-up is anything but slow.
Australian officials and business executives are sprinting to build a new Olympic Park on environmentally sensitive reclaimed industrial land, balance the $3.3 billion Games budget with a mix of public and private funds, leverage the fame of the Olympics to draw foreign investment Down Under, and devise a marketing plan that trumpets the Sydney Olympics around the world without resorting to crass commercialism.
The last point is especially sensitive. Atlanta, which hosted the 1996 Summer Games, came in for worldwide criticism for allowing sponsors to paste corporate logos on anything that moved.
Last month, the International Olympic Committee, the global authority that oversees both the Summer and Winter Games, initiated a marketing code. The code is designed to forestall "ambush marketing" like that employed by Nike in 1996, when the swooshmeisters passed out branded "Just Do It" signs to the crowd in Atlanta's Olympic stadium for the benefit of the TV cameras.
"I think it's fair to say we won't be quite as commercial as Atlanta," says Rod McKeoch, the Sydney lawyer and SOCOG board member who headed Sydney's bid for the 2000 Games.
That may be easier said than done, says longtime Olympics-watcher Ed Hula, editor and chief writer for Around the Rings, a biweekly newsletter and Web site (www.aroundtherings.com) that covers the Olympics.
Hula, who lives in Atlanta, observes: "Sydney is probably not as wild and uncontrolled as Atlanta. On the other hand, Sydney is a thriving commercial place. It has just as much potential for unauthorized merchants or retail establishments to act on their own."
It may be tough to control freelancers who appropriate the rings for "Olympic" kangaroo pizza, but with large-scale, ambush marketing under control, the 2000 Olympics should be a reasonably dignified event, Australian officials say.
Geoff Gray, Australia's consul general in Atlanta, says he thinks the government's big stake in the 2000 Games -- the state of New South Wales, where Sydney is located, is underwriting the $1.7 billion construction cost -- will lessen the need to rely on the vagaries of private enterprise. Atlanta depended heavily on the market to fund and run the Games.
John Moore, group general manager of marketing for the Sydney Organizing Committee for the Olympic Games, says that selling the Olympics is "a combination of entertainment marketing, sports marketing and good brand management."
Moore, an Australian who was formerly Asia Pacific vice president for Warner Brothers, says, "The market response has been extraordinary. Every Australian is aware of the importance of the Games."
That's not to say enthusiasm is universal. Even in business circles, some entertain Olympian doubts.
Brett Wayn, president of Beyond Productions, a Sydney multimedia company known for its futuristic "Beyond 2000" TV series, says bluntly "I'm not a fan. The government can't figure out how to fund a hospital. We're not great logicians in organizing large numbers of people. We're going to lose money." Wayn acknowledges, however, that "a large majority of Australians think the Olympics are just wonderful."
SOCOG's Moore says the Games are riding a groundswell of public enthusiasm, and that enthusiasm has carried over to big league corporations that are, additionally, eager to garner worldwide publicity and lucrative contracts.
Sydney is spending $1.7 billion to build its Olympic Park and another $1.6 billion to stage the 17-day Games. A significant chunk of the Olympics budget -- just over 20 percent -- comes from NBC, which bought the U.S. television rights for $705 million. Another $700 million of the total $3.3 billion Sydney Olympics budget remains to be raised.
The Games are supposed to earn a $30 million surplus. To get the money flowing, SOCOG has signed what it calls "team millennium Olympic partners" -- big-time private sponsors, including Coca-Cola, IBM, Visa International and Kodak. Nine of the 22 partners are American.
Major partners pay SOCOG $40-50 million and provide in-kind services such as telephones (Telstra) and computers (IBM), in return for using the Olympic rings in their marketing. "The partners are the infrastructure of the Games, the Olympic DNA," Moore says. "No organizing committee can go out there and buy all these services."
Moore says SOCOG signed up "change agents" who can help stage the Games in accord with Sydney's vow to produce history's most environment-friendly Olympics. "If we bring in a paper company, it's not just because lots of paper is needed for (sports) results. We ask them to work with our waste management. We're looking for essential services, rather than just an opportunity to put out their logo," he says.
According to Phil Keeling, commercial advisor at the U.S. Consulate in Sydney, "Sydney companies are getting the lion's share of construction contracts. We're trying to find where the niches are for goods and services." Keeling says U.S. companies could get a piece of the action for security, portable toilets, and helicopter landing pads.
Sydney officials say they are using less-toxic building materials at the future Olympic Park at Homebush Bay, 9 miles west of the downtown business district. Moreover, rainwater is being collected and reused, building materials are recycled, and the habitat of a rare frog spurred officials to move a projected sporting facility several hundred yards away.
Homebush Bay is located on the Parramatta River estuary, with venues being built on land that until the 1980s was used for an abattoir. The land requires extensive cleaning up -- "remediation" in engineer-speak.
Presently a massive construction site, the Olympic Park will eventually include a solar-powered Olympic Village for 15,000 athletes and officials. The village will become private housing after the Games.
Several permanent sporting and exhibition venues will rely on natural ventilation and natural lighting to reduce the need for air-conditioning. Sydney temperatures can soar into the 80s and 90s; but, as Around the Rings editor Hula points out, the city is fairly cool in the first place during September -- their early spring -- when the Olympics will be held, so natural buildings could be more of a cost-saving move than a green gesture.
Australia hopes for a major tourism bump from the Olympics. Indeed, Sydney officials say they expect an additional 1.5 million tourists over the next decade, thanks to the Games.
Ambitious Australian officials hope that visitors will do more than go to the Games; they want foreign business types to stick around and invest their dollars, yen and euros.
To that end, Australia's federal government, New South Wales state government, Westpac Banking Corp. (Australia's biggest bank) and Telstra Corp. Ltd. (its biggest telecom company) have formed a joint venture called Investment 2000.
Formally endorsed by SOCOG and the IOC, Investment 2000 "is an international partnering program ... providing a highly targeted international investment audience . . unprecedented levels of entree. This means everything from access to high level Games' sponsor networks for commercial purposes and the potential for investors to attend Olympic events in the year 2000," according to its literature.
Suzanne Jones, director of programs and projects for Investment 2000, says organizers are promoting Sydney as the gateway to Asia and a prime regional headquarters. "What we're trying to do is sell Sydney: its (modern) infrastructure, its telecommunications, its communicative skills, its marketing skills," she says.
As a small market of 18 million, Jones says, "Australia has always depended on foreign investment" to jump-start its economy, create jobs and spark technology transfer. According to Jones, Australia is trying to drum up business in "financial services, information technology, health and pharmaceuticals, food processing, metals, pulp and paper."
Even without the Olympics, the U.S. is heavily vested in Australia. America, with $65 billion in investments, is Australia's largest foreign stakeholder. Moreover, the U.S. enjoys big trade surpluses with Australia -- in 1996, it hit $10.5 billion -- and is the county's no. 1 source of imports.
In order to draw more direct investment, Australia is offering corporate tax abatements, allowing the spouses of resident foreigners to work (many countries prohibit this) and streamlining residential visa requirements.
More broadly, Australia is nurturing a pro-business culture. Earlier this year, Australia partially deregulated its telecom industry. It has also cut tariffs and deregulated financial markets, allowing the entry of foreign banks.
Largest venue ever
Back in Homebush Bay, the dazzling Olympic aquatic center -- future site of the swimming and diving competition -- is already open, filled on a bright afternoon with squealing schoolchildren. Scheduled for completion next month: an Olympic Park rail terminal, with natural lighting and ventilation and the capacity to move 50,000 riders per hour.
The 110,000-seat stadium, to be finished in 1999, will be the largest Olympic venue ever built, according to SOCOG. Recently, an overhanging fringe, which will shield spectators from the scorching Australian sun, began going up. It will give the stadium a distinctive, saddle-shaped profile. (Note: Its post-Olympics configuration; The seats at the North and South ends will be provided with roofs, which will also be fully retractable, enabling the entire arena to be enclosed. The lower-tier seatings will also be permanently movable, so the ground can constantly be reconfigured between soccer/rugby and Australian Rules. An Aussie Rules Field is roughly the same size and shape as the 'footprint' for an athletics stadium - minus the track.)
Eventually, that signature stadium, along with sparkling views of Sydney Harbor, will illuminate global TV, becoming almost as familiar as the Olympic rings. An advertising campaign will start a year before the Games, which run Sept. 15 through Oct. 1, 2000. Six million tickets go on sale in 1999.
Says Investment 2000's Jones: "It's a once in a lifetime opportunity. If we don't use it, it's to our detriment."
On February 25, 1999 Scott Alcorn wrote: Stadium Australia, the worlds biggest olympic stadium, will be opened on Saturday March 6, 1999. It will be hosting a 'double header' of rugby league action, with Newcastle playing Manly and St. George/Illawarra playing Parramatta.
All 110,000 tickets have been sold, meaning that it will be the largest crowd to any sporting event in Australia, and the largest crowd to any rugby league match in history.
To which Dylan responded on September 15, 1999: Here are some facts concerning the Sydney Olympic Stadium. On August 28th there was a Rugby Union game held there which had approximately 107,000 spectators which was the biggest crowd ever in Sydney and for Rugby Union. The guy talking about the Olympic Stadium having the largest crowd ever in Sydney is wrong because the largest crowd in Australia is 125,000 in the Melbourne Cricket Grounds.
Then on November 10, 1999 Ben Davies jumped in: G'day again, I was noting the 'conversation' between your correspondents Scott Alcorn and 'Dylan' regarding which was the largest stadium in Australia. The Olympic Stadium in Sydney boasts as its record crowd the 107,582 who attended the 1999 National Rugby League Grand Final on September 26 (won by the Mighty Melbourne Storm!!!)
The capacity of the Melbourne Cricket Ground is presently around 98,500, with the biggest crowd in recent years being 99,645 at the 1997 Grand Final of the Australian Football League between Adelaide and St. Kilda. However, I can categorically say that the biggest-ever attendance at any sports event in Australia was at the Melbourne Cricket Ground for the 1970 Grand Final between Collingwood and Carlton - 121,696, to be exact......