It's hardly an original insight to note that traditional media companies are trapped in their legacy business models at a time of rapid change in technology and consumer behavior. But rarely do you see the old and the new in such stark tension as in the case of NBC Universal's plans for presenting the upcoming Summer Olympics in Beijing. According to this AP story, NBC will offer an unprecedented 1,400 hours of TV coverage across its six networks--more than all previous Summer Olympics combined--as well as 2,200 hours of live coverage on the Web and over 3,000 hours of highlights available on-demand from NBCOlympics.com.

But NBC is also imposing severe restrictions on how anyone else can use the footage it compiles. Other TV networks covering the events will have only a limited window in which to air highlights, and NBC has banned the use of any Olympics video footage on any Web site other than NBCOlympics.com.

Good luck with that last one. As others have noted, the big winners in that effort will be unlicensed P2P networks and illegal download sites that will rush to fill the vacuum with pirated TV feeds and footage ripped from foreign coverage. NBC says it is working with a hundred of the top video sites to keep unauthorized footage off the web, but that will only increase demand for pirated content.

The real problem NBC faces, however, isn't the (high) likelihood of piracy but the fact that it paid $3.5 billion for the rights to the five Olympics culminating in the Beijing games, including $850 million for Beijing along. It made that deal back when big-money sports rights deals could still be justified by the broadcast networks because they served as an invaluable platform for promoting the network's other fare even if the games themselves lost money.

As always, the premise of those deals--and of the overall strategy of paying for sports rights--was exclusivity. You had the Bully Pulpit to promote your other shows and drive ratings across your line-up, and your competitors didn't. Networks were willing to pay a stiff premium for that opportunity.

Trouble is, exclusivity, especially on the Web, is rapidly going the way of all flesh. Try as it might, NBC is going to have a tough time keeping a lid on Olympics footage online. Worse, viewership of prime time shows has fallen sufficiently overall that even the added promotion they'll get during NBC's Olympic broadcasts is unlikely to produce a return large enough to justify the premium NBC paid for the Olympics platform.

As for the games themselves, NBC will attempt to protect its TV ratings by not providing live Web coverage of any event scheduled for taped coverage during prime time and won't make any footage of the events available online until after the event has been broadcast.

That of course will do nothing to stop fans from shooting their own video of the events and uploading it to YouTube, or ripped coverage from foreign TV coverage from being posted hours before NBC gets around to showing the event in prime time.

The net result is likely to be that NBC loses some prime time viewership as well as monetizable traffic to its own Web sites.

The basic premises on which NBC Universal made its Olympics deal more than four years ago no longer hold. You can't buy exclusivity anymore and it wouldn't be worth paying for if you could. But NBC is stuck trying to pretend that you can. And so it's trying to pretend that the Web is simply another distribution platform for its TV programming and can be scheduled by day-part, just like its network TV schedule.

It's not and it can't be.

Paul Sweeting

Paul Sweeting is the Editor of Content Agenda, a business-to-business brand dedicated to the nexus of content, technology and business. This piece was originally published on Paul's blog "Media Wonk" on Content Agenda and is posted on DMW with the author's permission.