IBM's decision to sever its 38-year marketing relationship as a sponsor of the Olympic Games is sparking a competition by about a dozen major computer companies to fill Big Blue's shoes.
The interest rivals of International Business Machines Corp., including computer maker Hewlett-Packard Corp. and software company Novell Inc., underscores that IBM's pullout hasn't tarnished the allure of the Olympics' all-gold image as a corporate marketing tool. But it has changed the rules of the game.Instead of signing an exclusive agreement as it did with IBM, Olympics organizers this time are seeking a group of computer, software and networking equipment makers to handle the behind-the-scenes technology that IBM has been doing by itself, from running Olympics World Wide Web sites to score boards.
The idea is to spread out the multimillion-dollar cost of high-tech sponsorship, which was the big stumbling block in negotiations between Olympics organizers and IBM for an eight-year contract extension.
IBM, which spent more than $100 million to sponsor the 1998 Winter Games in Nagano, Japan, and provided much of the behind-the-scenes technology for free, wanted local Olympic organizing committees to share the technology costs. Olympics organizers balked.
Despite IBM's departure from the Games starting in 2002, marketing experts say the Olympics are still seen as a powerful way to enhance a brand image with even more widespread appeal than endorsements of individual athletes. Some people will choose a product with the Olympic emblem over another product because they want to support the Games.
"Even before the IBM announcement, there were a number of very, very senior executives in information technology who had sent us queries," said John Krimsky, head of the marketing arm of the U.S. and Salt Lake Olympic committees.
Olympics organizers solicited competing proposals from several technology companies after IBM submitted a bid that seemed expensive, said Richard Pound, an International Olympic Committee vice president in charge of sponsorships.
IBM was one of 11 global sponsors of the 1998 Games. Most paid the IOC more than $40 million for their sponsorship packages, but IBM spent roughly twice that to fill the additional role of technology provider.