Written By: Toby Lang, Senior Counsel, Bell Media
In November 2023 The Athletic reported that tennis’ four Grand Slams are considering partnering with ten of the sport’s biggest tennis tournaments to form a breakaway ‘premier tour’ similar to Formula One which, if realized, would “revolutionize the sport.” What came as a shock to many casual fans, however, was largely expected by those who follow the sport closely. With the start of a new season and the Australian Open underway, it is a good time to look at how professional tennis arrived at this break point moment.
Tennis’ core strengths remain the envy of pro sports. It is one of the world’s truly global games with over a billion fans worldwide comprised in roughly equal numbers of men and women. At the professional level, the game offers integrated men’s and women’s products, is closer to gender pay equality than any other sport, generates content that is ideally suited to personalized and immersive digital fan experiences, and boasts a slate of emerging stars that is dynamic and diverse with serious social media presence – all qualities that will help tennis attract the younger, digital-first audience that is coveted in professional sports.
Despite these advantages – and the tennis community currently enjoying fifteen days of summer in Melbourne – professional tennis finds itself in a prolonged winter of self-reflection. The introspection has been driven by longstanding criticisms regarding everything from the sport’s power structure (fragmented) to its rights (under-monetized), competitive format (confusing), and tournament schedule (longest in professional sports). There is also the concern that tennis is vulnerable to the sort of disruption experienced by professional golf following the launch of the Saudi-backed LIV Golf tour. To their credit, tennis’ decision makers have acknowledged these challenges head-on with Stacey Allaster, USTA Chief Executive of Professional Tennis, saying it best: “The status quo is not an option.”
The players went to work starting with the August 2020 launch of the Professional Tennis Players Association (PTPA) with a mandate to “create transparency and fairness throughout decision-making in professional tennis.” Led by Novak Djokovic and Canadian pro Vasek Pospisil and backed by American billionaire hedge fund manager Bill Ackman, the PTPA raised US$26 million and in August 2022 launched Winners Alliance – a for-profit affiliate of the PTPA designed to generate and maximize off-the-court commercial opportunities for players. “Tennis has more total viewers worldwide than baseball and football combined, but just 10-ish% of their revenue,” explains PTPA Executive Director and Winners Alliance CEO Ahmad Nassar. “And the athletes only see about 17% of that revenue, whereas football and baseball are hovering around 50%. It’s just an order of magnitude off.”
The tours have also taken action. The ATP – the men’s tour – issued its “OneVision” strategic plan in June 2022 which commits the Tour to providing the players with increased transparency on the economics of the ATP tournaments and giving them a greater upside on their success through a 50/50 share in profits. The plan also includes “Baseline” – a new compensation model coming later this year that will establish guaranteed base earnings for players allowing them to plan their seasons and invest in their support teams. These measures along with others in the plan are all designed to cultivate what ATP Chairman Andrea Gaudenzi calls a “mentality of unity” between the players and the Tour.
On the women’s side, this past summer saw the WTA continue its pursuit of what Billie Jean King started over fifty years ago by approving a plan to achieve equal pay across the tennis calendar by 2033. It also released its own strategic plan with a partnership with private equity firm CVC Capital Partners in March 2023 as its centrepiece. CVC’s US$150 million investment will help the WTA build player and tournament profiles and deliver on its commitment to increase prize money.
All steps in the right direction, but the question remains whether these measures will do anything to advance the concept of a premium tour involving tennis’ top players and tournaments. This option has the broadest appeal for good reason. The anticipated benefits include improved athlete health and well-being through a streamlined schedule with defined breaks. There is also the prospect of increased revenues by the Slams and top tournaments working together to sell their media, sponsorship and data rights collectively. Finally, adopting an F1-like model of centralizing the sport’s best athletes and tournaments and packaging them in an easy to follow schedule will allow fans to reliably find and engage with their favourite players and events. It will also help the game raise player and tournament profiles and create compelling storylines around them, making them more sellable to media and advertising partners.
If tennis’ decision-makers are aligned on anything, it’s that a premium product is necessary to succeed in today’s ultra-competitive sports and entertainment sector. The path to premium, however, is less clear. Is it best for the Tours to elevate their top tournaments – ATP Masters events and WTA 1000 tournaments – in order to close the gap with the Slams and create a cohesive premium product that way? Or do the Slams need to actually breakaway from the ATP and the WTA taking a selection of those tournaments with them and presumably leaving the Tours to run the small and mid-sized tournaments? With discussions continuing to swirl around these options as well as others, this year is expected to be a defining period for the business of professional tennis.
It all makes for what The New York Times describes as “a once-in-a-generation opportunity for disruption.” And while it may be difficult to imagine professional tennis’ seven distinct governing bodies rallying around a single solution, events in 2024 will continue to favour reform. Along with the Grand Slams delivering their long-awaited proposal on the premier tour concept, the PTPA will continue expanding its membership and credibility, the Tours will further build out their strategic plans, concerns about outside disruption will persist if not amplify, and a new generation of diverse and talented stars – Carlos Alcaraz, Coco Gauff, Ons Jabeur and Frances Tiafoe among them – will continue to rise. Conditions have never been better for positive, lasting change in tennis.