GOODWILL GAMES : Chances of Goodwill Games III Are Tinged by Red Ink : International event: Diminished sense of rivalry, failure to build TV audience combine to cloud future of competition.

If Ted Turner gets his way, which he usually does, the Goodwill Games, like Rocky movies, will continue long after critics contend they have outlived their usefulness.

But at least Sylvester Stallone could claim after the first two Rocky movies that his creation was a financial and perhaps even an artistic success. Upon conclusion Sunday of Goodwill Games II, Turner can make only half that statement.

“The athletic competition was first rate,” he said at a news conference Saturday.

But even that is debatable in some of the 21 sports that were contested in Seattle, Tacoma, Spokane and other Washington cities over 17 days by 2,336 athletes from 54 countries.

Financially, it is all there in black and white or, actually, red.

Turner, chairman of the board and president of Turner Broadcasting System, Inc., warned his shareholders last month that TBS could lose as much as $26 million, equal to the deficit it reported on the first Goodwill Games four years ago in Moscow. Published reports estimated that the losses could be closer to $40 million.

“Yes, we did lose some money--the exact amount will not be available until later--but, in my opinion, it’s a reasonable down payment toward an event that will grow in the future and will, at some point, break even,” Turner said Saturday.

It is Turner’s job to sell his optimism to TBS’ board of directors, which will determine in October the extent of the network’s involvement in future Goodwill Games.

Turner has a tentative contract with his partners from the Soviet Union’s sports and television-radio committees, Goskomsport and Gosteleradio, to organize the 1994 Games in Moscow and Leningrad.

Paul Beckham, president of Goodwill Games, Inc., a Turner subsidiary, said the contract will not be executed until approved by at least 12 of the 15 board members.

“I would be disappointed if we don’t go forward,” Beckham said. “I think the board would be disappointed if we didn’t go forward. But it’s a business decision based on many factors.”

Even if TBS does not continue in its current role, Goskomsport and Gosteleradio officials said they would attempt to stage Goodwill Games III.

Vladimir Geskin, deputy editor of the Sovietsky Sports newspaper speculated that the Goodwill Games might have more credibility internationally as an athletic competition if Turner was less involved.

“It wouldn’t be perceived as just a commercial enterprise,” he said.

But without Turner as a partner, Anatoli Kolesov, a deputy minister of Goskomsport, acknowledged that it would be necessary to find sponsors to provide the hard currency necessary to attract leading athletes from the United States and other Western countries. Soviet rubles are not convertible into Western currency.

As sports that until recently were considered amateur have begun allowing athletes to receive money legally for performing, the cost of organizing invitational competitions has dramatically increased.

TBS paid $12.5 million to the federations that govern U.S. sports and an additional $7.5 million to the Soviets. Much of that money was used in either attracting athletes or, in the Soviets’ case, paying them performance bonuses.

As a result, the competition in most sports was as good as could be expected considering the Goodwill Games’ position on the calendar between the Olympics of 1988 and 1992. Two world records were broken, compared to six at the first Goodwill Games.

Turner officials acknowledged disappointment in only one sport, track and field, which attracted about half of its top names. The performances also were disappointing. In only 13 of 42 events were the results better than in 1986 at Moscow.

That could be attributed to the cool weather or the new track at Husky Stadium, but another possibility is random, out-of-competition drug testing that has been instituted in many parts of the world and appears to be the most serious deterrent yet to steroid use.

In some sports, the top names were here, but their hearts were not. Figure skaters who found it incongruous to be competing in August considered the Goodwill Games an exhibition. In other sports, such as swimming, diving, wrestling and boxing, the competition was of the highest caliber.

But the question remains whether such an event is necessary.

Athletes in each sport peak during the year according to the importance of a competition, such as a national or world championship, and then athletes in all sports peak simultaneously once every four years for the Olympics. Where the Goodwill Games fits into the order of things has yet to be established.

One thing clear is that the Goodwill Games does not fit into the schedules of most U.S. TV viewers. While Turner’s ratings were considerably better than those of four years ago, the Games were viewed in an average of only 1.18 million homes--1.27 million in prime-time--through the first 14 days.

In contrast, Pyotr Reshetov, an official with Gosteleradio, said between 70 and 80 million people in the Soviet Union watched each day and that 120 million saw the U.S.-Soviet basketball game.

As there are only two channels in the Soviet Union, viewers there have fewer options. Even then, Vladimir Pozner, a well-known Soviet television commentator, was skeptical about Gosteleradio’s figures and said he did not believe there was a great deal of interest in the event in his country.

Perhaps the Goodwill Games would be more compelling if there were more pre-glasnost ill will between the United States and the Soviet Union. One Soviet track and field athlete said that the Games seemed more like a gigantic sports festival than a competition.

“Even Pepsi executives are talking to Coca-Cola officials,” comedian Yakov Smirnoff joked.

Turner, who also created the Better World Society, welcomes the development. He said the end of the Cold War eventually will lead observers of international sports to pay more attention to individual athletic achievements and less to the medal count.

For those who have not arrived at that point, the Soviet Union entered the final day of competition with two more gold medals--24 more total--than the United States.

No other country entered a full complement of athletes, but it might be a historical footnote that East Germany finished third with 10 gold medals. Considering the fast pace of that country’s re-unification with West Germany, this probably was the last international, multisport competition for the East Germans.

Those who were here frequented a restaurant near the athletes’ village at the University of Washington. When they left, they signed their names on the wall with this postscript: “The last East Germans in Seattle.”

Seattle also has seen the last of the Goodwill Games--at least for eight years.

The Seattle Organizing Committee unfortunately underestimated the impact the Games would have on the local economy, but fortunately overestimated the impact on traffic. Despite selling fewer tickets than anticipated, SOC President Bob Walsh said the committee expects to break even.

Many here seemed to enjoy the experience, particularly those who had personal contacts with more than 1,000 Soviet visitors, although one restaurant owner told the Seattle Times that this is the “worst summer we’ve had since Mount St. Helens erupted.”

She could not have been pleased with Walsh’s announcement Saturday. Cities that have expressed interest in staging the 1998 Goodwill Games, if there is such a thing, include Indianapolis, Raleigh-Durham, N.C., Phoenix, Toronto, Montreal and two locations in China that have not been revealed.

“And Seattle wants it back,” Walsh said.