From its beginnings, generally dated as 776 B.C., the Olympic games have evolved from a simple athletic competition into a mammoth entertainment spectacle. The games enjoy worldwide popularity fueled by nationalism and the suspense of competition.
The Tokyo games consisted of 79 different competitions in 339 events for over 11,000 athletes from 205 countries, plus coaches and support staff. Approximately 5,000 medals were awarded in both the Olympic and Paralympic games.
These games, originally scheduled for summer 2020, were estimated to cost $7 billion. Including the $3 billion expense caused by the delay, the final bill was over $30 billion. The IOC contributed $1.5 billion and sponsors subsidized $7 billion, leaving the Japanese government on the hook for the remaining $21.5 billion.
Revenue from broadcast rights (the IOC keeps 90%) and ticket and merchandise sales almost never cover the cost of the games. Hosting the Olympics is a money-loser for cities in almost every instance. Some Olympic cities planned that venues built for the games would be used for future events. Too often, though, they are unused or underutilized and are in a state of disrepair requiring expensive maintenance. These facilities provide little or no revenue.
The prestige of hosting the games has been tempered by high cost, thousands of IOC requirements and public resistance. A pattern has emerged where several cities are interested in hosting but after a return-on-investment analysis is completed, most drop out of the bidding. High construction costs are always a deterrent. The IOC is having an increasingly harder time finding host cities and selected sites are dominated by wealthy cities.
One alternative is to regionalize the games. A geographic area or continent would host the games rather than a city and its environs. The region would utilize existing facilities as much as possible, thus minimizing construction costs. New construction would be allowed only when no venue exists for a specific sport in the region.
Of course, there would be many issues to be resolved by the IOC and the countries in a region. Among them: Which country hosts which sport? Which countries are in the region? How will dollars be divided?
For example, if South America were chosen to host the games, one sport would be held in Brazil, another in Peru, another in Chile and so on. Such a strategy would minimize costs for each country and spread revenue among them. Hotels, restaurants and retail stores would profit in many countries rather than in one city.
One can easily see North American games, European Union games, Asian games etc., becoming profitable. By spreading the expense and revenue, Third World nations with improving economies, such as those in Africa, could host the games, yielding financial benefit and increasing their prestige in the eyes of the world.