Let the (Social) Olympic Games Begin!

July 31, 2012 5:04 PM

LONDON - Athletes at the 2012 Olympic Games in London will be playing by some new rules this summer. Women will be boxing for the first time, and runners who jump the blocks will be automatically disqualified. But the rules the corporate world will be watching most intently aren't the ones that govern the events themselves.

During what's been dubbed the first "social media" games, the International Olympic Committee is encouraging athletes to share their experiences with the world. Its social media guidelines suggest that they communicate "in first-person, diary-type format." But the medal hopefuls will have to watch what they post, blog, and tweet because the IOC, as the owner of the Games (and author of the Olympic Charter), has set limits on what they can say.

They're not supposed to comment on other participants. They can't post video or audio of activities that take place in an Olympic venue. And as part of the IOC's ongoing efforts to protect the exclusive rights of official Olympic sponsors, athletes are prohibited from using social media and the Web "to promote any brand, product, or service."

Welcome to the fiercely competitive arena of Olympic marketing, where so many high-stakes advertising dollars are on the line. For years, officials around the world have been on guard against ambush marketing from businesses that—whether intentionally or not—make it seem as though they're associated with the Games, and encroach on the exclusivity that sponsors pay for. Similarly, under Rule 40 of the Olympic Charter, the IOC strictly limits athletes from appearing in any advertising for a monthlong window during and around the Games (unless a sponsor has secured a waiver from Olympic authorities).

A recent ruling in the United Kingdom involving Nike, Twitter, and a pair of soccer players may have foreshadowed some of the issues that could confront Olympic officials. In June the U.K.'s Advertising Standards Authority banned a Nike campaign that employed tweets by Manchester United's Wayne Rooney and Arsenal's Jack Wilshere to promote the brand, determining that it wasn't clear to the public that these were ads. The athletic apparel manufacturer argued that its endorsement deals with the players were well-known, and that Rooney and Wilshere were free to tweet about Nike's "Make It Count" campaign "at their own discretion," according to The Guardian.

All of the build-up certainly has the attention of the national committees—including the U.S. Olympic Committee—which are responsible for enforcing the IOC's rules. Amy Savela, the USOC's associate general counsel for marketing, says that she and the legal department will be monitoring a running list of social media concerns ranging from the language that companies use to talk about athletes and the Games to what athletes themselves say.

Attorneys and the marketing staff will field complaints, prioritize them, and flag them for discussion among counsel in London. They'll also try to resolve these complaints by reaching out to companies and athletes' agents to enforce IOC rules and the USOC's intellectual property rights. "This is the first Games where we're really seeing such active use of social media to promote the Games, which is going to be a challenge for us," says Savela, who's been in the Colorado Springs–based in-house department for eight years.

There are various kinds of sponsorships connected to Olympic competition. Through the IOC's Olympic Partner program, an elite group of global sponsors negotiates worldwide rights to use marks such as the Olympic rings and terminology like "London 2012" in advertising campaigns, paying about $100 million each to sponsor a four-year Olympic cycle. Meanwhile, sponsors at a national level obtain rights to use marks such as national flags emblazoned with the five Olympic rings, and they have to limit their marketing to their own countries.

The IOC shares the responsibility of protecting the Olympic brand with a legion of guardians, including the London Organizing Committee for the Olympic Games and the national organizing committees. The USOC, for example, is a nonprofit that was created by Congress to help support Team USA. As such, it licenses all the IP rights associated with the Olympics in U.S. territory. And even sponsors of the American team have to get approval for advertising copy from the USOC.

If that sounds simple and clear-cut, it's not. The U.S. Equestrian Federation, for example, has a sponsorship deal with Land Rover, which helps pay for both human and equine athletes to make it to London. But Land Rover is not an official Team USA sponsor, so the federation's GC, Sonja Keating, has to watch out. "We have to be very careful about how we name our selection trials," she explains. "We cannot use the term 'Olympic selection trials' unless we enter into an agreement with the USOC as to the terms of usage, and the commercial branding of the venue."

Similarly, Keating strives to be clear with the federation's own sponsors about the restrictions that they, too, will face on the use of Olympic terminology. "What I don't want is for them to advertise and associate with the Games in a way that's not permissible," Keating says. "We're very careful about what we sell, and how we package it, and how we communicate it so our sponsors understand what they can and cannot do."

Olympic executives and official sponsors dread the prospect of ambush marketing. The term can be hard to define, but essentially boils down to a company that is not an Olympic sponsor implying an association with an event that cuts into another company's exclusive deal. As Visa in-house counsel Christopher McCleary explained at a sports law symposium at the University of Michigan last winter, it's the kind of thing that you know when you see it. And when folks at Visa, one of only 11 worldwide Olympic sponsors, spot an ambush from a competitor, it hurts. "It's extraordinarily painful for us to think of spending many millions of dollars to get that association, and then have somebody else pretend that they've got it," McCleary said. "That's the nature of ambush marketing."

McDonald's felt the pain during the 2010 winter games in Vancouver. That's when Subway, a nonsponsor, created a television commercial in which star swimmer Michael Phelps fueled up with Subway fare, and started swimming toward Canada, headed for "where all the action is"—which struck many observers as a classic ambush ad.

For all their rules, officials can be hard-pressed to punish the perpetrator of a clever ambush. Barring a clear IP violation, enforcement can be problematic. After the Subway episode, for instance, the USOC's chief executive, Scott Blackmun, took a naming-and-shaming approach, lambasting the sandwich maker for "taking advantage" of the Olympics and cutting into funding for athletes. The Olympic spirit "is based upon a spirit of fair play, and ambush marketing clearly violates that spirit," Blackmun fumed in a public statement.

Rules like Rule 40 and the social media guidelines do make it clear, however, that athletes' eligibility may be at risk if they're involved in certain kinds of marketing. Companies shudder at the idea that they could be responsible for a disqualification. That's the ultimate threat, says Rich Foster, an attorney who represents the agency PMG Sports. "Companies get really cautious because they don't want to be the entity that disqualifies an athlete," he says. "What bad PR that would be for them."

But no one can recall anything like that happening. The practical challenge for the lawyers working in this area is maximizing good publicity and steering clear of bad. And this year, watching those tweets strikes many as a big enough job. "It's more challenging because technology has afforded us a way to communicate in ways that we've never been able to communicate before," says the Equestrian Federation's Keating, "and we take that for granted oftentimes."

(Source: Law.com)