Empty Seats Could Mean Billions for Tokyo Olympics

(ATR) The decision to ban overseas spectators from the Tokyo Olympics doesn’t have to mean financial losses from those empty seats. In an OpEd last May, Around the Rings Editor Ed Hula proposed a digital response for the IOC and Tokyo 2020 that calls for a new way of bringing the Games to fans worldwide.

Slightly updated from the original and just in time for April 1 levities, the idea of a digital fan experience still seems destined to reach the Olympics.

As the coronavirus heads into year two and the postponed Tokyo Olympics loom in just four months, the absence of a few hundred thousand overseas spectators is now certain. Decisions on how to admit domestic ticketholders are coming.

Amidst the massive costs of postponing the Games by one year, hundreds of millions of dollars of lost revenue from ticket sales will only add to the financial grief.

"Things are changing" is the warning from thought leaders around the world. They say it may not be possible to return to the way things used to be.

IOC President Thomas Bach says as much in a letter from last April acknowledging the challenges for the Olympics from Covid-19..

"We are all only beginning to understand the far-reaching consequences of the coronavirus crisis around the world. What is certain, however, is that this pandemic has affected and will affect all areas of society, including all of us in the world of sport, significantly," Bach writes.

He says ideas are needed and that creativity is essential to finding new approaches for this post-corona world.

Here’s my idea.

The reality Bach seeks may indicate that packed stadiums are no longer safe. Limited or zero spectators may be the new paradigm for safety and good health in staging large and important events.

The answer is digital spectators. Not just for a quick fix as we search for the new normal. This could be a concept that delivers on the symbiotic need for interaction of fan and competitor. And it could open the path to new revenue streams replacing the traditional sale of tickets.

The figures could be staggering, considering the number of mobile device users in the world – estimated at some five billion.

The new paradigm: digital spectators to replace those who once flocked to the temples of sport.

Imagine the new stadium in Tokyo July 23, 2021, as the opening ceremony gets underway. While the new National Stadium has 60,000 seats, new post-corona standards might allow only 25 percent – or about 15,000 -- to be occupied by spectators.

But there are no empty seats. That’s because all have been equipped with a video screen, loudspeaker and a connection to the world’s biggest-ever network. Every seat in the stadium glows with presence of virtual spectators who have logged on from around the world.

It truly is an Olympian feat, made possible by the most robust technological infrastructure ever designed including a killer app from the IOC. Sponsors such as Alibaba, Atos, Intel, Samsung and Visa likely would want to be involved. Other firms are sure to want to join in this tech tour de force.

Connecting through a remote device, whether laptop or smart phone, digital spectators follow the ceremony in a close and personal way. Just as athleteswill enter the stadium grouped together, so too will their national fans be seated together for the virtual audience.

Their faces will appear on the digital screen in their seat. Cheers and applause picked up by the mobile device will be part of the roar of the crowd the athletes will hear in Tokyo that evening. There would be no mistaking the digital fans as artificial.

The ceremony will mark the start of 17 days of the first Olympics for virtual spectators.

Access to the Olympic digital feed comes with a fee. Because potential buyers number in the billions, the digital fan base could well outstrip ticket sales and perhaps even free-to-air broadcast rights. Revenues would be collected at the national level with a share going to each national Olympic committee.

The presence of digital fans could solve a chronic issue that arises every Olympics: swaths of empty seats in many matches.

A first round handball match with Spain and Egypt might not be so appealing to Tokyo ticket buyers. But the handball arena could still be filled with thousands from both countries via digital.

In the old days of paper tickets, a venue could hold only as many spectators as seats. By going digital, the limit would not be physical seats but bandwidth needed to funnel digital spectator traffic from every spot on theglobe.

Revenue could be unlimited, depending on how rates are structured and deals that are struck with carriers in each region.

Digital ticketing could be a real disrupter. Besides the host city losing money-spending crowds, businesses around the world that sell Olympic tickets could face a frightful reckoning. But if digital revenue reaches gargantuan levels, it could outstrip the value of current deals with rights-holding broadcasters.

For sports on the Olympic program, widespread use of digital spectators could bring unprecedented levels of interest to world championships and events of the international federations held outside of the Games.

Free of the need to travel and to spend money for accommodations and other needs, physical barriers to fan participation will be minimal. Revenue streams could be bountiful, regardless of where the actual event is to be staged.

The impact of spectator-free Olympics will be felt by the hospitality industry in a host city. But evidence shows the Olympics are a mixed bag for the tourism sector wherever they go – seldom are there net tourism gains. And for cities that might need to build new accommodations to meet IOC needs for 40,000+ rooms, zero spectators would ease the burden of unsustainable building.

Same goes for venues. With the need to accommodate fewer spectators, venues can be smaller. Crowd management won’t be the logistical challenge it often is.

Protecting Olympic visitors now costs $1 billion or more each Games. Without spectators, the security effort would be cheaper and focused on the athletes.

Transportation in the host city won’t groan under the strain of hundreds of thousands of Olympic spectators, either. Expensive and often controversial improvements to public transit could be minimized.

Zero spectators may be just the giant step the IOC needs to make as it defines the Olympics for a post-corona world.

"For most sports events, as for all sectors of society, things will not be as they were before," writes Bach. He has tried to be an agent of change beginning with Olympic Agenda 2020, his seven-year-old program aimed at the sustainability of the Olympic Games.

Since then Bach and the IOC have added to that with a philosophy called "new norm", which calls for even deeper cuts and simplification in the way the Games are staged. In his letter last month, the IOC president says the experience of the corona medical crisis shows even more effort is needed to keep the Olympics sustainable.

"These new measures should lead to an even more restricted footprint for all the stakeholders at the Olympic Games," Bach writes.

An Olympics without eight million ticketholders would certainly reduce the footprint by quite a few sizes.

Written by Ed Hula.