The Olympic organizers are banning all spectators from the Games this year after Japan declared a state of emergency designed to stem a wave of new Covid-19 infections.
It is the latest setback for the Summer Olympics, which has already been postponed by a year, which resulted in high costs for the postponement. The state of emergency begins on Monday and lasts until August 22, while the games are scheduled from July 23 to August 8.
The organizers had already excluded international viewers from participating and set a ceiling for domestic viewers at 50% of capacity or up to 10,000 people.
There is immense pressure to contain the spread of the virus at the Games to protect both athletes and neighboring regions. More than 11,000 participants are expected to travel to Japan to compete, along with thousands of officials and staff who will also attend.
Nationwide, Japan has reported about 811,000 coronavirus cases and more than 14,800 deaths, according to the World Health Organization. However, the country faced a relatively slow adoption of vaccines. According to Reuters, only about a quarter of the population has received at least one COVID-19 vaccination.
Adaptation to no fans
NBCUniversal, the parent company of CNBC, plans to show more than 7,000 hours of content from the Tokyo Olympics through its networks and streaming platforms. Now NBC has to grapple with whether viewers notice the difference without viewers.
Sports venues around the world were customized without fans during the pandemic and often used digital seats to indicate some form of attendance. US professional leagues like the National Football League and Major League Baseball have also incorporated artificial noise into their broadcasts to mimic the noise of the crowd.
It is difficult to get viewers involved in sports broadcasts without viewers, so NBC could use the technology to improve production. In 2014, the media giant and the International Olympic Committee agreed on a $ 7.75 billion media rights deal to extend their partnership. The current agreement runs until 2032.
Still, an Olympics without fans will destroy ticket revenue for the IOC. According to an IOC annual report, more than 6 million tickets were sold for the 2016 Rio Games, raising approximately $ 1.2 billion.
Due to the delays, the games budget has already risen to an estimated $ 15.4 billion, according to Reuters, and ticket revenue of around $ 815 million is likely to drop to near zero.
Disclosure: CNBC parent NBCUniversal owns NBC Sports and NBC Olympics. NBC Olympics holds the U.S. broadcast rights to all Summer and Winter Games through 2032.