QUEBEC CITY (AP) — International and U.S. Olympic leaders finalized a new revenue-sharing agreement on Thursday that ends years of acrimony between the powerful bodies and clears the way for future American bids for the games.
After years of protracted negotiations, the two sides signed a long-term agreement that will reduce the USOC’s future percentage share of TV and marketing revenues — a breakthrough that helps bring the U.S. back into the international fold.
“This is a very happy moment,” IOC President Jacques Rogge said. “This agreement will definitely strengthen both sides.”
USOC chairman Larry Probst called it a “terrific arrangement for both the IOC and the USOC, a great outcome for the Olympic movement around the world.”
The deal, which runs until 2040, resolves the long-running dispute over the U.S. share of Olympic television and sponsorship revenues that soured relations and undermined recent American bids for the games.
The USOC had said repeatedly it will not bid again until the revenue issue was resolved. With a deal in place, the U.S. will consider whether to bid for the 2022 Winter Games or 2024 Summer Olympics.
“We hope this has removed a road block from a successful bid for the United States,” Probst said, adding that the USOC would hold a board meeting in San Francisco next month to consider how to move forward.
Lingering international resentment over the U.S. share of revenues was a key factor in New York’s failed bid for the 2012 Olympics and Chicago’s stinging first-round elimination in the vote for the 2016 Games.
The U.S. last hosted the Summer Olympics in 1996 in Atlanta and last staged the Winter Games in 2002 in Salt Lake City.
Under a long-standing contract, the USOC has received a 20 percent share of global sponsorship revenue and a 12.75 percent cut of U.S. broadcast rights deals. The IOC believed the U.S. share, set out in an open-ended contract dating to 1996, was excessive and should be renegotiated.
The current U.S. share will remain the same until the new terms come into effect in 2020.
From then, the USOC will receive “a smaller percentage once some minimums are reached,” IOC finance commission chairman Richard Carrion said.
“The percentage of both the U.S. broadcast rights and TOP (sponsorship program) will reduce,” he said.
Carrion said the deal also sets out new procedures for USOC involvement in negotiations of U.S. TV rights.
IOC and USOC officials declined to give specific figures of the agreement at the news conference, but The Associated Press learned details of the terms.
According to several senior officials with knowledge of the contract, the USOC will retain the revenue it currently receives but its TV rights share will be reduced to 7 percent on any increases in broadcast deals and its marketing share cut in half to 10 percent on increases in sponsorship revenue.
The officials spoke on condition of anonymity because the terms were not being made public.
In addition, the USOC agreed to contribute to the administrative costs of staging the Olympics — $15 million through 2020 and $20 million after 2020, the officials said. The contract also covers issues related to ownership of Olympic rights, trademarks and historic TV footage.
“We went into these negotiations with the objective of addressing the key issues important to the IOC and to ensure the financial well-being of the USOC on a long-term basis,” Probst said. “I think we were able to accomplish both parts of that equation.”
Among the U.S. cities that have expressed early interest in bidding for the 2022 Winter Olympics are Salt Lake City; Denver; Reno-Lake Tahoe, Nevada; and Bozeman, Montana. Dallas is among those interested in the 2024 Summer Olympics, while New York, Chicago and Los Angeles could also be potential candidates.
Talks to reach a settlement have been going on for more than two years. The deal was essentially sealed when IOC director general Christophe De Kepper traveled to Washington last week to meet with Blackmun and tie up the final details. Both men got the backing of their respective boards.
The new sign of goodwill between the IOC and USOC was evident immediately after the signing of the contract.
IOC Vice President Thomas Bach, a leading contender to succeed Rogge when he steps down in 2013, approached Probst in the lobby of the convention hall and said: “Hey partner. Congratulations.”
(© Copyright 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)