Thursday, December 18, 2014

The Difficult Economics of Professional Tennis Players

Yesterday, the New York Times reported on a new analysis by the International Tennis Federation:
The I.T.F. surveyed more than 7,000 players and other stakeholders in the sport and analyzed data from the past 14 years, which revealed differences in expenses incurred by players based on ranking, geography and gender, as well as a falling success rate for players transitioning from the junior level to the professional ranks. According to the federation’s study, the number of ranked players competing in junior tennis has increased, while the percentage of those who achieve a professional ranking has decreased significantly.

The I.T.F. found that the top 1 percent of male players (the top 50) earned 60 percent of all prize money, while the top 1 percent of female players (only the top 26 because of the smaller total number) earned 51 percent.
These numbers are similar to those I discussed at FiveThirtyEight earlier this year in a piece I did on income inequality in professional sports, with a focus on golf. In that piece I noted that three men's tennis players, Roger Federer, Rafael Nadal and Novak Djokovic, accounted for 20-26% of total winnings on the ATP Tour from 2007-2011.  

The ITF analysis came up with this incredible statistic:
In an I.T.F. calculation that accounted for only minimal expenses, the ranking point at which players could expect to stop losing money on their careers was No. 336 for men and No. 253 for women. Aside from prize-money discrepancies at many levels of the game, female players have fewer tournaments to choose from and therefore travel more, resulting in higher expenses.
Sponsorships are not included, but these numbers suggests that the professional tennis economies can  only sustain a few hundred players on the men's and women's tour. This cannot be a recipe for developing talent or even sustaining the sport.

Both the ITF and the ATP are implementing proposals to increase prize money and balance out its distribution. Yet, there is a continuing debate over how much income inequality is appropriate in tennis. As Eric Butorac, president of the ATP Player Council, noted: "I think it is so important that we continue to build the base of tennis. However, if fans are not paying to watch these levels of tennis, then where does the money come from?"

1 comment:

  1. Since 1990, the ATP has seemingly accepted growing levels of prize money inequality between its main tour and the second-tier Challenger tour. I say "seemingly" because I don't know if anyone at the ATP has done the analysis as the link below (adjusted for inflation etc since 1978). The game's top players are the its top commercial assets naturally and so (in my opinion) it is fair that they reap a greater share of the prize money. But the ATP's Dec 2014 prize money announcement fundamentally calls into question where the line is between too much/too little inequality.
    What is more certain is that the ITF and Challenger tours should not have their prize money determined by market forces for 2 reasons. 1) Too much inequality and younger players can't break through (statistically, the ATP top 50 is the oldest and least likely to change that it has ever been; and 2) low prize money at lower levels raises the risk of match-fixing.
    There's more here if you're interested: