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Thursday, June 13, 2024

Bankruptcy fears hit Holmenkollen

Just 10 days before the City of Oslo must send in its controversial bid to host an expensive Winter Olympics in 2022 comes news that Oslo’s Holmenkollen Ski Festival and World Cup competition this weekend is in serious financial trouble. The annual event reportedly is grappling with such a large deficit and uncertain income prospects that it’s threatened by bankruptcy.

The City of Oslo had to cover most of the costs of building the new Holmenkollen Ski Jump needed to host last year's Nordic skiing World Championships. Budget overruns were enormous, with little state funding, so some Oslo politicians and residents are wary about committing to an Olympics. Holmenkollen is also expected to be used in an Olympics in 2022, but may need further improvements by then. PHOTO: Ski VM/Stian Broch
The City of Oslo had to cover most of the costs of building the new Holmenkollen Ski Jump needed to host the Nordic skiing World Championships in 2011. Budget overruns were enormous, with little state funding, but now many Oslo politicians are again trying to mount an Olympic bid. Holmenkollen, already facing deficits, is also expected to be used in an Olympics in 2022, but may need further improvements by then. PHOTO: Ski VM/Stian Broch

It won’t disrupt events due to begin later this week, but Norwegian Broadcasting (NRK) reported on Monday that Holmenkollen’s operating deficit has risen to NOK 12 million in the past year. The deficit comes in addition to the huge construction budget deficit accrued when the Holmenkollen Ski Jump and surrounding Nordic skiing facilities were rebuilt to host the World Championships in 2011.

The financial problems are largely attributed to a sharp decline in public interest for the winter sports event, lower ticket revenues and a lack of interest from sponsors. The problems are so acute, reports NRK, that organizers are now considering “selling” the event’s 50-kilometer ski race as a separate event that may be named after a sponsor willing to pay for it.

Current organization and operation of the Nordic ski races and ski jumping at Holmenkollen “can’t continue as now,” Kristin V Sæterøy, the new boss of Holmenkollrennene, told NRK on Monday. “We must turn things around.” The ski jumping and races at Holmenkollen were once highly popular and attracted tens of thousands of cheering fans, but everything from a sharp rise in ticket prices two years ago to poor weather and changing habits and interests among the public have literally taken the roar out of the crowd.

Sæterøy was hired in December to tackle the financial problems now facing one of Norway’s most well-known winter sports events. Even though it has a solid spot on the World Cup circuit, and has been a favourite event for the athletes, it didn’t come close to filling the grandstands in either 2012 or 2013, and won’t this year either. Sports officials who were roundly criticized for jacking up ticket prices in 2012, and winding up with so few spectators that even King Harald commented that the turnout was sparse, didn’t manage to recover by lowering prices again last year. The event has also been hit hard by milder winters, worries over a lack of snow and fog so thick that spectators sometimes haven’t been able to see the jumpers.

‘Extremely vulnerable’
Others speculate that such large ski festivals simply aren’t as popular as they once were, even in Norway. They also must now compete against many other events that vie for spectators’ time and disposable income. “We are extremely vulnerable to the results of ticket sales,” Sæterøy told NRK. “We must see if we can run this economically without being so weather-dependent.”

This year’s event, which costs NOK 18 million to mount, is also budgeted with a built-in deficit. “We can’t avoid it,” Sæterøy said, but she hopes to get Holmenkollen “back on track.” One idea is to get a single major sponsor for the 50K race, for example, and another sponsor to fund the cash awards to winners. She thinks there’s potential for Oslo’s annual “Kollen weekend” because “the brand is strong, start numbers have been sold and ads have been sold for the arenas.” This year, though, the events at Holmenkollen also collide with NRK’s own production of Norway’s run-up to the European Song Contest (called Melodi Grand Prix) and coverage of the Paralympics beginning back in Sochi. Despite host country Russia’s military intervention and escalation in Ukraine, the Paralympics were still due to get underway this weekend as well.

While organizers rig up for the upcoming events at Holmenkollen, defying the rain that’s been falling over Oslo and the fog settled over the hills, Sæterøy will have a hectic schedule of meetings with more potential sponsors. She called the financial problems “a paradox,” because Holmenkollen otherwise gets high rankings from the International Ski Federation (FIS) “and we are very good at arranging it.” The challenge is making it pay off, just as it is for arrangers of even bigger sports events like World Championships and, not least, the Olympics.

‘Nail in the coffin’ for OL?
The trouble attracting spectators and sponsors for Oslo’s venerable Holmenkollen, along with its resulting deficit, is more bad news for those promoting a Winter Olympics (OL) in Oslo in 2022. The OL plans already face strong opposition among a majority of Norwegians, according to public opinion polls, because of their costs budgeted at NOK 35 billion at least. Now some critics think, or even hope, that Holmenkollen’s woes will be “the final nail in the coffin” for an OL. At this point, only Oslo politicians, tourism industry executives and sports officials seem enthusiastic about it.

NRK’s report on Holmenkollen’s troubles Monday afternoon set off a string of comments in  NRK’s debate section, also from people who think sports and sporting events get far too much financial support from the public sector already. “Let’s just drop an OL in Oslo,” one man wrote, while another added “we can’t ignore that many people are just fed up with all the sports hype in this country.” Berglund



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