The Five Biggest Challenges Facing the Delayed 2020 Olympics Now
The two-week event is built on a Jenga-tower of thousands of independent economic interests.
(Bloomberg) -- By agreeing to the first postponement in 124-year history of the modern Olympics, Tokyo 2020 organizers, sponsors, athletes and fans now face a whole new set of questions and logistical challenges. There’s a reason it takes many years and several billions of dollars to host the games: the two-week event is built on a Jenga-tower of thousands of independent economic interests.
Still, relative to canceling the competitions outright or trying to hold a diluted version, postponement turned out to be the best of a slew of bad options -- for Tokyo, which expected a bump from the tourism and hospitality around the games, for the International Olympic Committee, which gets 73% of its revenue from broadcasters, and for sponsors, the companies that have already spent years and millions to build an advertising strategy around the games.
The biggest variable of all -- the path of the coronavirus pandemic -- is beyond their control. If it continues unabated, Olympics organizers may have to go back to the drawing board again. But assuming the situation gets better, not worse, here are the four biggest questions that need some fast answers.
When will the games begin?
Organizers said the games would happen sometime within the first nine months of 2021 and they have plenty of wiggle room. There’s no fixed date or even a requirement that they happen in the northern summer at all. While “same time, next year” has an appealing simplicity, an earlier or later start would avoid the high temperatures that until recently were the biggest health risks for athletes and spectators.
The two biggest Olympic sports have their major international championships next summer: the World Aquatics Championships championship is scheduled for the last two weeks in July in Japan, followed immediately by the World Athletics Championships in the U.S. Both federations are in touch with the IOC and said they would be flexible within reason, according to NBC Sports. Aquatics ruled out a delay to 2022, while Athletics said that could be a possibility.
Who’s going to pay for it?
A delay is going to be expensive, with estimates starting at 300 billion yen ($2.7 billion) and rising. The biggest additional costs come from keeping staffers on the payroll, plus maintaining empty venues. The Japanese Olympic Committee said it will discuss whether to go back to local sponsors, like Asics Corp., Asahi Group Holdings and NEC Corp, though some may take the opportunity to rethink or renegotiate their commitments. Tokyo Gas Co. president Takashi Uchida said the company hadn’t yet decided whether to continue with its deal.
If sponsors don’t pony up, the municipal government and the IOC -- along with any potential insurers -- will have to argue over who’s responsible for the shortfall. The host city contract between Tokyo and the IOC doesn’t address postponement; any disputes between the two parties can be referred to the Center for Arbitration in Sport in Lausanne. It’s also possible that the national government could provide some relief.
Where are the games going to be?
While the Olympic Stadium designed by Japanese architect Kengo Kuma will undoubtedly be available whenever the games are scheduled, several of the Olympics venues are already booked for at least parts of 2021. Tokyo International Forum, which was to host weightlifting, starts taking reservations two years in advance and has events booked through that time period, according to a spokesperson. The Nippon Budokan also has booking through at least March, and Makuhari Messe and the Tokyo International Exhibition Center typically host hundreds of repeat events each year.
If the already chosen venues aren’t available, they’ll have to find new ones. The calendar congestion will be a problem for arenas of any size anywhere, and organizers may have to look elsewhere. Some events may have to relocate to farther-flung parts of Japan or out of the country entirely. Sailing events are often held outside of land-locked host cities, and equestrian competitions were held to Stockholm in 1956 and Hong Kong in 2000 to avoid quarantine and other equine travel issues.
Who gets to go?
The Tokyo Olympics were shaping up to be the hottest ticket in sports, with two-thirds of the 7.8 million available tickets sold or distributed already. Now, with dates, times and venues in question, ticket-holders have yet to learn whether their tickets will be honored for rescheduled events or whether the committee will offer refunds -- according to the official terms and conditions, they don’t have to. That leaves people like Tokyo movie producer Shinichi Takahashi, who paid 216,000 yen ($1,950) for four tickets to track and field events, in limbo. “Given the Covid-19 situation, The decision was inevitable but I hope the committee will announce their policy regarding refunds soon,” he said.
The stars of the games -- the athletes -- were the loudest chorus calling for postponement, even at the expense of their own opportunity. Global sports federations and national teams will have to decide what to do with the athletes who’ve already qualified, how to select the remainder, and how to remake their own sports calendars -- each only a slightly smaller constellation of venues, sponsors, dates and organization.
Is a year long enough?
While it’s hard to imagine the coronavirus outbreak won’t be under control any time soon, experts say it may well take months to contain. A vaccine is even further off: clinical trials have just begun and won’t conclude before the end of the year.
The path of the virus is outside the control of the Olympics organizers, of course. But if training, traveling and big public gatherings remain a serious health risk for a long period of time, the 2020 games may not happen in 2021 either.
©2020 Bloomberg L.P.