TMCnews Featured Article
Avaya Takes Over Nortel's 2010 Winter Olympics Sponsorship
By Brendan B. Read, Senior Contributing Editor
Nortel supplied the Olympics a converged IP-based voice/data/video infrastructure: the first of its kind at any Olympics. Bell Canada (News - Alert), another official supplier and sponsors, provides communications services to the Games off it.
The Canadian Press (CP) reports, via a CTV story, that Avaya inherited the sponsorship when it purchased Nortel’s enterprise solutions business. TMCnet.com reported that Canadian government had blessed Avaya’s $915 million deal Dec.4, 2009, citing Avaya’s commitment to keep much of the Canadian unit’s employment intact and to making R&D investments. Avaya had won the Nortel division at an auction whose results were announced Sept.14.
Dave Johnson (News - Alert), general manager of the Olympic program at Avaya, told the CP that the Games are an opportunity to introduce the new company to a global audience. The Winter Olympics and Paralympics are expected to draw 3 billion worldwide television and 70 million website viewers according to VANOC, the Games’ organizing committee.
Other observers say the accession to Avaya from Nortel in the Olympics sponsorship will boost Avaya’s presence in the Canadian market especially as well as globally. It will also help with the transition from Nortel to Avaya for Nortel enterprise customers who see the changing in the flag, giving them further assurance that their products will continue to be supported.
“It's an interesting time for us to be able to ride that wave of interest and enthusiasm and get people engaged in our new brand, our new company,'” Johnson, who has been working on the Games sponsorship since it was awarded to Nortel in 2007 told CP.
As for the value of the sponsorship, Johnson said Nortel, now Avaya, has stuck to a “very rigidly formed'' return-on-investment model.”
“By all business metrics we have done a very good in capitalizing on the Vancouver sponsorship,” he said. “It has been highly effective at elevating our brand.”
The Nortel/Avaya sponsorship is what is referred to as “value-in-kind” where in exchange only their products and services are used for that event. The article says that one of the big benefits of this agreement for suppliers is the ability to prove “that if their product works for the Olympics, it can work for anything.” Which it says what drove Nortel to sign on for the Olympics.
In turn, the Games receive significant financial contributions from suppliers. The CP/CTV piece reports that the 64 sponsors are covering off more than half of event’s $1.75 billion operating budget, commitments they make in cash and goods to have give products exclusive status.
Alas not every value-in-kind sponsorship has run as smoothly as Nortel/Avaya’s. The CP/CTV story led with a feud inside VANOC over wireless equipment use.
Many staff use BlackBerries but maker Research In Motion is not a sponsor, but Samsung (News - Alert) is, so they’re being forced, said the story, to use that manufacturer’s Omnia or Vice units. That has made some of them unhappy because they are “frustrated with the touch-screen devices, saying key functions like sending and reading e-mail are nearly impossible.”
VANOC has downplayed the concerns, reports the story, saying staffers with Samsungs just need to get used to the product
“The value-in-kind we get is fully useful, meets our needs and fully offsets the budget we would otherwise have to spend,” said Dave Cobb, deputy executive director of VANOC.
Samsung will provide 9,200 units for VANOC, the International Olympic Committee and assorted VIPs to use during the Games, said the story.
“We expect the Vancouver 2010 Olympic Winter games to generate more wireless content than any previous Olympics,” said a statement from Howard Thomas, director of corporate marketing for Samsung Electronics Canada. “It is our goal to help people - from athletes to spectators, officials to volunteers - capture and share this content with others around the world.”
Brendan B. Read is TMCnet’s Senior Contributing Editor. To read more of Brendan’s articles, please visit his columnist page.
Edited by Patrick Barnard