Tuesday, August 14, 2012

Olympic Bidding - The Future

Now that a very successful London Olympics has wrapped up, not only does the world look ahead to Rio de Janeiro in 2016 but beyond to potential host cities for the Summer Games of 2020 and 2024.

As the Olympics grow, the International Olympic Committee may find itself in a more difficult position to attract potential hosts. Mounting security costs (approximately $860 million in London) and a large number of sports requiring more and more competition and practice venues (26 sports in London) make submitting a bid a difficult decision for many cities. The up front costs are one issue but creating future legacies through infrastructure is paramount for considering a bid. No city wishes to be the next Montreal, for its poor financial management, or Athens, for its boarded up and unused venues. So going forward, what cities may consider a bid? There appear to be three categories of cities coming forward.  

Historical Cities

There’s been a trend in recent years for the world’s historic, great cities to submit bids. Their population bases, existing infrastructure, Olympic history and economic clout make bids more viable. London and Paris hotly contested the rights to 2012. Tokyo is a leading candidate for 2020 and was initially competing with Rome until its bid was withdrawn due to Italian austerity measures. Los Angeles has been rumoured to be considering a bid for 2024. All five of these cities have previously held the games so there is a definite trend towards cities looking to host for a second or even third time.  

Medium Sized yet Prominent Cities

These are cities that may not be considered in the same historical context as the likes of London and Tokyo but are highly prominent in their country. They have reasonable population bases to support a bid but would need significant investment in infrastructure to accommodate the games in their current form. Toronto is a prime example. It is considering a 2024 bid and may be in great position to win with Atlanta in 1996 the last North American Summer Olympics host. Similar to Rio, it is building its reputation and venue base by hosting the 2015 Pan-Am Games. Saint Petersburg, Russia, Brisbane, Australia and regular bidder Madrid, Spain (a candidate for 2020), would all be cities in this category. Their smaller relative size may make it challenging considering the investment but they do hold a certain prominence on the world stage. The reality is there may not be enough cities in this category to consistently provide legitimate bidders for the IOC.  

New World Cities

With medium cities reluctant to enter into a risky financial venture, new world cities, defined as those making their first modern day forays to global prominence, are looking to make a splash on the international scene and see the Olympics as the opportunity to do so. There is clearly a trend to such cities not only mounting bids but now winning. Beijing was the first city in this category to which the IOC gave the games. Though an ancient city, its burgeoning new economy led it first to host the World University Games in 2001 and then a very successful 2008 Olympics. Rio too has a long history but it is the IOC’s first foray into South America and thus fits in this category. Brazil is clearly looking to make similar type of world splash as China with not only the Olympics but the 2014 World Cup as well. Other cities that could be looked to for future bids include Doha, Qatar, Dubai, United Arab Emirates, Taipei, Taiwan. South Africa, merely 20 years from its return to the Olympics, and India would be two other countries with emerging cities like Capetown, Durban, Delhi or Mumbai to put forward. These ‘new’ cities may be the best option for the IOC to further grow its global presence and build strong bid competition.

Going Forward

The IOC needs worldwide bid competition to keep the games growing, generate revenue and provide better athlete experiences. They can’t afford to return to the days of 1984 when Los Angeles won as the only bidder. Security is obviously crucial but is often seen as overbearing, extreme and thus expensive. Optics alone may dictate this area as difficult to pare back but security expense alone may stop cities from bidding. The IOC has more control over minimizing venue requirements as it can restrict the number of sports on the program or tailor the program to a country’s existing venues. As an example, golf and rugby sevens will be able to use existing venues in Rio. By keeping the numbers lower and accepting temporary venues it means hosts can limit permanent infrastructure and thus better manage the legacies of the games.

No matter how you look at it, hosting the Olympics is a costly endeavour. The main question remains as to what cities feel the tangible and intangible benefits far outweigh the costs. The IOC hopes many from the lists above will throw their proverbial hat in the ring.

No comments: