EPIC FAIL! How the US Massively Underperforms the World in Tennis Player Development

An expectation reducing mind-set has come out of the United States Tennis community trying to explain away the remarkable decline in US men’s tennis the past few years.  US tennis enjoyed a golden age of tennis where male professional players won more than 25 slams between Michael Chang’s 1989 French Open win and Andre Agassi’s 2003 Australian Open Championship.   Since then, the US has won no Men’s Grand Slam championships.  At the time of this writing the US has 9 players in the top 100 in the world today, five of those players are near 30 years old or above and are likely to drop out or retire from the top 100 in the near future (At the time of publication 2 players have dropped out of the top 100, down to 7).  Pro player development is at a standstill as “keystone cops” management fumbles Grand Slam wild cards substituting washed-up older players for younger players with potential.

USTA executive leadership or pro players have two lines of thought about the US cliff dive out of the tennis world elite.  First, US tennis fans are spoiled and they need to expect less.  Second, the US tennis public will need to wait 10 years for US tennis to bounce back.  Much of this is echoed by sportswriters like Peter Bodo who doesn’t expect things to get better any time soon or Peter Alfano who reports tennis is in a nose dive.  Greg Couch, in “From Spoiled to Rotten…”  covers the same territory as this article in a qualitative, Royko-esque fashion.

We wondered if there some way to assess and illustrate if American expectations for professional tennis should be abandoned?  Is this the end to American Tennis Exceptionalism?  Should we expect to be outperformed and viewed as another sport where American supremacy has been bypassed like Lebron and Dwayne watching Dirk Nowitzki driving to the hoop?

In response, we created a methodology called the Secada Population and Economic Country Tennis Efficiency Rating (SPECTER) with a formulation to measure a country’s tennis player performance vs others measured by youth population available to play tennis and by a country’s tennis economic power rating.  Note:  We’ll address the second, corrosive, 10-year wait line of thought in another post.

Our ratings  show the United States radically underperforms the market to the extent that any programs instituted have no impact on US tennis.  When adjusting for youth, the United States has more children of tennis playing age than all of its modern European rivals combined including Russia, Spain, France, UK , Switzerland and  Serbia.   Also, the U.S. is home to one of the grand slams, the US Open, which we have already analyzed as a $1.4 billion economic powerhouse worth $200 million to the cash flush USTA foundation which has $200 million of it’s own money already socked away.  When you factor in the economic capability for tennis development the US program is a catastrophe!

First we show the results.  We came up with a metric to measure tennis performance by country using number of players in the top 100, providing a power score for each ranking by adding up the difference between 100 and a players ranking.  So #1 Novak Djokovic would have 99 points, #10 Andy Roddick, 90 points.  When we add up these scores (based on mid July, 2011 rankings) by country, we can compare actual results by country reducing the impact of quantity focusing on total quality of rankings.  Note:  Tennis historian Phil Secada has done a similar study on power ratings for tennis.  

Tennis Players in Top 100 Rankings

Country	# of Tennis Players in top 100
Spain	14
USA	9
France	8
Argentina	6
Russia	5
Serbia	3
Swittzerland	2
Great Britain	1
Australia	1

Weighted Average Strength of Program by Country

Country	Total Weighted Rankings
Spain	815
France	519
USA	372
Argentina	334
Russia	268
Serbia	254
Switzerland	181
Great Britain	96
Australia	29

Total Tennis Economic Capability by Country

Country	Market Potential (Millions)
France	235.67
Australia	232.30
Great Britain	214.65
USA	210.00
Spain	38.11
Switzerland	16.50
Russia	9.29
Serbia	5.02
Argentina	4.41

Total US Power Efficiency Rating vs. Other Countries or Secada Population and Economic Country Tennis Efficiency Ranking (SPECTER)

Country	SPECTER
Serbia	48.27
Switzerland	10.47
Argentina	7.71
Spain	3.21
Russia	1.40
France	0.19
Great Britain	0.04
USA	0.03
Australia	0.03

As shown by the tables above the US appears to have a respectable tennis program ranking second with 9 of the top 100 players in the world after Spain which has fourteen players.  Drilling down a bit further even when adjusting for the cumulative rankings of all players by country, the US finishes third behind Spain and France, slightly ahead of Argentina.

But what happens when we adjust country ratings by population and then by the ability to commit economically to tennis development.  As discussed above, the US has more people of tennis player development age than all of its main European rivals combined.  In addition, the USA is one of four tennis economic super powers.  As we discussed in our prior article on the billion dollar US Open, the USTA is a remarkably wealthy not-for-profit with the US Open as its central cash cow.  It spends more than $15 million a year on player development and richly rewards their executive staff in total compensation ranging from $8 million in 2009 to $50 million in 2008 with a steady $10 million a year in travel expenses for those executives and others.  When factoring in these numbers as shown in our SPECTER Power Ratings, the US finishes dead last among the major tennis countries to an extent that it has a power rating less than 1% of world leader, Serbia.  Though Serbia may be a super-charged performance outlier; the US still rates less than 10% as effective as Switzerland, Argentina and Spain.

Demographics is Destiny Everywhere but the USTA Development Program

In providing this analysis, we took a deep dive into the demographics of tennis development age youth by country.  Our data came from the CIA factbook and 2010 US Census data.  Since detailed 18 and under Census data by country wasn’t readily available, we used CIA factbook data for 14 years and under population as a proxy.  Reviewing prior ranking data, we found that most top rated tennis players began playing professional tourneys at 16 or 17 year olds so for development purposes, the numbers aren’t divergent from population trends.

Country	Population Size  14 Years and Under (Millions)
USA	61.9
Russia	21.6
France	12
Switzerland	1.1
Serbia	1.1
Great Britain	10.8
Spain	7
Europe Total	53.6
Argentina	10.3
Australia	3.9

The chart below shows the US placing last among leading tennis countries based on population of potential tennis players.   Some may argue that the US has less temperate weather than Australia.  But we can eliminate all tennis regions with the exceptions of historical hotbeds California, Florida, Texas, Georgia and Arizona and the US potential population is still greater than every other country combined except Russia which has some bad weather of its own.

Realized Tennis Potential by Population

Country	Realized Tennis Potential by Population (higher ratings mean better)
Serbia	2309.09
Switzerland	1645.45
Spain	1164.29
France	432.50
Argentina	324.27
Russia	124.07
Great Britain	88.89
Australia	74.36
USA	60.10

But weather isn’t the only rationale for impact on tennis player development as Serbia worked its way through the breakup of Yugoslavia and a civil war, Spain suffers from massive unemployment and Argentina has had to work through two existential financial crises in the last decade.

Economic Potential for Player Development

After reviewing for population we next determined what is the economic potential for player development.   We looked at Gross Domestic Product (GDP) as an indicator but determined that GDP  represents a country’s entire economy and would overstate the US and European countries ability to commit to youth tennis development.  We also looked at GDP by potential player development population but determined that it would reflect negatively on a small country like Switzerland which has a large GDP/Capita and a small birth rate.  Likewise, low birthrate countries like Australia and Great Britain would suffer.

Eat What You Kill

Ultimately, we determined a better measure would be what we call Market Economic Potential (MEP).  MEP states that a tennis program can only spend money it has and no more to develop players.  We measure MEP  by the largest tennis tournament held in a country and the revenue it generates.  Though some may argue by purchasing power parity that one tennis dollar in Argentina or Serbia is worth more than a tennis dollar in the US we reviewed purchasing power parity GDP indicators vs country GDP indicators and found less than a 30% variation in real GDP vs. purchasing power parity GDP for any countries involved in this study.  So a dollar in Argentina may be worth more than in the US, but not more than 30% more.  Negligible since Argentina outperforms the US in tennis by a factor of 10 not .3.

We measure MEP using revenue generated by the largest tennis tournament run by each country’s tennis association.  Like the US Open that generates $210 million a year in revenue for the USTA which it then applies about $15 million to player development, most countries have a main tennis tournament which feeds resources into their player development program.  Though we don’t have the revenue for each tournament, assuming cost and profit ratios are the same as the US Open, we use prize money as a proxy for revenue and estimate it based on that prize money number which is easily available via the ATP web site.   As an aside this approach can only OVERSTATE, the ability of other countries to compete with the U.S.

The Grand Slam (dis) Advantage

Using these numbers, we see that any of the 4 hosts of the grand slams, Australia, France, Great Britain and the United States offer more prize money than the other leading tennis countries combined.  As a result we would expect that these countries would have outsized tennis programs with outstanding performance.   But outside of France, (with a potential tennis population a bit larger than California’s) with 8 players in the top 100 (4 players under 25), all the grand slam hosts radically underperform the market.   It’s as if the Anglo Saxon world forgot how to play tennis.  Assuming that all of these countries pay the same sort of $8 million in executive compensation as made by the top 8 or 9 USTA executives, The typical tennis fan sees pay for  non-player development and turns off the tv.  We can see the value of the prior USTA executives who fixed the broken US Open and doubled revenue from the tournament over the last 10-15 years, but existing programs are in “run the engine” mode with respect to their prized events.  The US Open already sells out every year, unless USTA adds seats, there isn’t much new work to be done.  But player development has gone into the abyss.

Country	Score / Market Potential
Argentina	75.67
Serbia	50.57
Russia	28.84
Spain	21.39
Switzerland	10.97
France	2.20
USA	1.77
Great Britain	0.45
Australia	0.12

It is easy to explain Great Britain’s lack of performance, they have bad weather, but the US has many states with moderate weather that historically have been suppliers of world class tennis talent and are still ripe for tennis player development as US population moves southward.  One of the negative statements about US tennis players has been that there are no clay court players coming out of the US.  How is this possible when we have Florida, the state that gave us Jim Courier and Chris Evert (Brian Gottfried, Eddie Dibbs and Harold Solomon)?

Fair Weather States	Potential Tennis Player Population (Millions)
Florida	4.12
California	9.51
Texas	6.98
Georgia	2.55
Arizona	1.68
	24.84

Perhaps the best explanation is that building a complex regionally centralized development program may not be terribly useful if developing players can’t afford the gasoline to get to those centers and don’t like being away from their parents.  At the same time there hasn’t been any substantial growth in USTA membership that exceeds US general population growth so it is hard to imagine where USTA dollars are going.  Let’s say there are 1,000 meaningful tennis centers around the country, then each center potentially could receive a $15,000 infusion to drive participation, pay the guys in the trenches more and lead more recruiting efforts.  But that doesn’t happen under the present regime’s model.  Likewise, the USTA web site offers no significant on-line tools for learning tennis or receiving coaching. ($15 million works out to about $15,000 a center.)

Regardless, we believe there are many ways to spend dollars on US tennis on a depth and breadth approach where players can be discovered and as they advance get the coaching they need without prejudice or obstruction.

If development dollars being spent are misdirected then what does work?  Serbia and Argentina have secret weapons.  It’s called “coaching”.  Serbia’s national ascendancy coincides with their usage of Niki Pilic as coach of their national team.  Pilic is the only person to win Davis Cup titles as coach of 3 different countries.   Marcelo Gomez has been the tennis development coach for US Open Champ Juan Martin Del Potro, Juan Monaco and a plethora of other top Argentinian talent.  We stole Jose Higueras from Spain, but so far his main response has been “Ay Caramba” to the broken development program.

And the US has great home-grown coaches who have developed top level talent, won Grand Slams, but are not associated with USTA tennis.  Their names, Brad Gilbert and Paul Annacone.  Between them they’ve coached players who have won far more grand slams than anyone presently involved with USA tennis.   Add in Michael Chang and Jim Courier you’ve got strategies for every surface category.

Billion Dollar Tennis Baby

There are few tennis tournaments like the U.S. Open.  It is a big tennis carnival that draws more fans and contributes more to the New York City economy in it’s 2 weeks of activity than the Yankees or Mets in the same time period.  When you look at the ecosystem of the US Open in terms of revenue generated by the tournament, revenue generated by New York City businesses and other multipliers you have a billion dollar tennis extravaganza.  The US Open  is wholly owned by the United States Tennis Association (USTA) and 50% of that revenue, more than $100 million, shows up as bottom line profit for the USTA.  So how big is the US Open nut and how do you back into the numbers that make tennis’ leading extravaganza so extravagant?

Our number for the US Open total revenue plus economic multipliers is somewhere around $1.4 billion.  Here is our  quick breakdown of US Open revenue as provided by massaging numbers presented by the USTA and the city of New York as well as the “multiplier” effect the Open has on its sponsors and players.

 

 

Deep Diving on the USTA Revenue Number for the US Open.

For the past several years the USTA has reported revenue of more than $200 million from the US Open.  We backed into these numbers by using several of the USTAs own numbers, published sources of information and filled in numbers based on guesstimates when needed.  Here is our breakdown of the $210 million in revenue shown in the chart below.

US Open revenue is anchored by ticket sales to more than 720,000 fans at an average estimated cost of $120 for a total amount of $85 million.  With tickets sales alone, the USTA  almost breaks even on expenses for the event as the USTA states that it has more than 50% profitability from its annual revenue of $210 million.  Likewise, US Open sponsorships garner more than $60 million annually from heavyweight advertisers like IBM, JP Morgan Chase and American Express, all trying to reach the elite US Open tennis fan where attendees median income is $150,000 and the majority are women.

Another $60 million of revenue comes from television.  Tennis tv viewership has plummeted since their 1981 high when 8 million people or more than 4% of Americans watched John McEnroe vs. Bjorn Borg.  Nevertheless advertisers want to reach the high-earning, remaining 2 million people, less than 1% of Americans, who still watch tennis on network tv.  Tennis still earns roughly $24million from CBS for prime time and another $23 million from ESPN and the Tennis channel.  Additional incentives bump the gross up as well as web and other broadcast/rebroadcast rights.

To fill the gap we publish a miscellaneous licensing and sponsorship fees for the grounds as well as website advertising and other cross-promotional numbers which get us to the $210 million mark.   The USTA should feel free to publish the real numbers though we feel comfortable with the numbers below and think it is more important to be thematically and directionally correct than to have 100% accurate numbers i.e. these are estimates.

Category	USTA Revenue (Millions)
Ticket Sale	$   86
TV Network CBS	$   24
ESPN	$   23
Vendor Sales Licensing	$     7
TV Advertising (partial)	$     5
TV Cable Advertising (partial)	$     5
Tournament Sponsorship	$   60
Miscellaneous Suite Sponsorship	???
Total	$  210

The US Open Multiplier Effect.

The US Open is the principal money-maker for the New York based USTA providing  more than 80% of its revenue for the year.  Also, New York City, surrounding areas and localities where fans emanate from experience a significant bump to their business as part of a US Open multiplier effect.  Past estimates from a 15 year old study are that the US Open generates more than $420 million in revenue for New York.  More recent commentary says that the numbers have not changed radically, however in a day of $10 burgers and $5 round trip subway rides, the economic impact of the US Open is grossly underestimated.

We back into the numbers two ways.  First we try the high level approach of adjusting for inflation.  Using Consumer Price Index (CPI) rates as published by the US Bureau of Labor Statistics we take the 2010 CPI  of 2.18 and divide it by the 1995 CPI of 1.52.  This creates a multiplier of 1.43 which we use against the $420 million figure.  When accounting for inflation, the real revenue multiplier to New York City and surrounding areas is close to $600 million in 2010 dollars.

Second, we use a method of estimating economic multipliers by category.  This approach is tricky business as Victor A. Matheson of Holy Cross University argues against the US Open’s multiplier saying they do not consider substitution, i.e. people who spend $100 at the US Open would spend the same amount at Jones Beach if it wasn’t happening that weekend.  Matheson argues there is no way  the US Open accounts for 3- 5% of all tourism dollars spent in New York City.

This article does not argue the US Open’s direct impact on the Tri-State economy as much as the combined direct and indirect impact.  So for example, is the US Open directly responsible for any and all Broadway sales or sight-seeing, cab usage or rental car bump in traffic over Labor day’s weekend and surrounding two weeks when most New Yorkers are out of town.  The answer is NO.  However, does the US Open influence families were the husband may want to go watch a match and his wife might want to do sight-seeing while the teenage kids go to see Spiderman on Broadway?  Or in other cases where a family may come in for one day of tennis and another day of sightseeing, etc?  CERTAINLY!

In addition, there is also the issue of re-purposed dollars which we address qualitatively.  For example if New York resident Jane Doe usually takes the subway on Saturdays to the farmer’s market in Manhattan but instead takes it to the US Open on Saturday of Labor Day weekend she is spending money she would have already spent on the subway, but in this case, it is being spent on the Open.

Also, we assume the average US Open tournament-goer is in the highest income bracket where spending $1,000 on a 2 day excursion to New York is not excessive.  The US Open has reported that its median attendee has income greater than $150,000 a year.

So where does the $600 million come from or go?  Here are our guesstimates based on an economic modeling approach rather than a bottom-up rollup of expenses that only New York City and other areas can provide.  Again, our estimates are on a total economic multiplier rather than just that for New York City and the surrounding tri-state area.  We do not consider global advertising impact from those who watch the US Open on television worldwide though that also bolsters the numbers.

Ticket Resales and On-Site Revenue:

US Open on-site revenue is similar to the movies as customers are expected to spend as much during the day on food, clothing and memorabilia as they do on tickets to enter.  Assuming total ticket revenue of $85 million from 720,000 customers we can see the same customers spending money on $10 hamburgers, multiple $5 beverages, $15 health food plates, $30-50 tennis sports wear, $25 US Open tournament brochures and other types of items and memorabilia.

Other web sites also discuss the availability of tickets that are resold on the US Open site, Stub Hub or other sites.  We estimate roughly 20% of all US Open tickets are resold at an increment on average equal to the original ticket price.  Forbes magazine reports that more than 100,000 US Open tickets sold in 2010 on the secondary i.e. scalped, market with average prices of tickets by round incrementing roughly $50 per round with the finals selling at a price of $350 per ticket.  These prices were quoted 2 weeks before the final which probably saw the price increase with a final between Rafael Nadal and Novak Djokovic.  In the past, showdowns between Sampras and Agassi have fetched more than $1,000 on the secondary market a day before the match.  Although our final estimate for resale is $17 million in total, if we calculated using an average resale using the Forbes estimate of $50 per round, the actual number is higher.

Accommodations and Transportation

The largest multiplier expense and the largest expense for the US Open is the Accommodations and Transportation multiplier.  Half of all attendees come from outside the tri-state area.  We expect attendees to spend the same amount on hotel and accommodations as they spend net on the tournament.  So if the average attendee spends $125 on a ticket and $125 on food and memorabilia, then we expect them to spend roughly $250 on accommodations per night.

Other significant expenses are the plane fare for 180,000, around $450 (remember for every penny-saver flight there is a high net worth flying a higher class travel) or driving expense.  Driving expense for the average US Open ticket-goer who drives 600 miles to the event is roughly $300 for 5 tanks of gas, plus food and beverage along the way, tolls and parking or somewhere around $450.  There is also transportation to and from the airport on average about $120 as taxi fares including tolls and tip exceed more than $50 from all locales and from Newark Airport can go as high as $80 one way.

Besides the New York City cost of airport transportation, we also include the cost of airport transportation to and from the 180,000 tourists local airports at about $100 as well when including overnight car parking or cab fare to the airport plus other expenditures including memorabilia, food and drink.  About 20% of all attendees park at the US Open at a cost of $20 plus more than $10 of tolls and roughly $10 of gasoline round trip.  Likewise many attendees rent cars who stay on NYC outskirts to get cheaper hotel accommodations or for concurrent business trips, another 2-day $100 expense.  (We don’t break that out from the general hotel fee).  About 80% of attendees take the subway or other public transportation to the US Open with some incremental cost.

Note:  we do not consider the impact of luxury US Open tours sponsored by the likes of American Express which include box seats and meet the player events, but that surely would raise the number.

Other New York Activities

We expect that half the people who travel to the US Open (180,000) spends on average an extra day enjoying NYC and its cultural activites.  We expect that person to spend roughly the same on their second day as they do at their day at the Open.  Whether seeing a Broadway show, average ticket price $100 and then having dinner, average price $50-75 with commensurate cab fares, taxes and tips, we have no problem estimating another $250 spent on day 2 of a trip to NYC.

Endorsements and Direct Sales

Beyond the normal multipliers that we consider of NYC expense and transportation expense we also consider direct sales channels for US Open tickets and special vendor considerations.  We estimate that 20% of all purchasers are USTA members who are primarily members to get access to early sales of US Open tickets.   At $75 for an average family membership the USTA may make as much as $10 million from memberships sold for US Open early access.  Likewise we estimate 20% of all purchasers are American Express users for the same reason.  With varying expense, we assume an average American Express card annual expense of $150.

Also, we look at player endorsements and other economics.  Maria Sharapova makes $25 million a year in endorsements.  Venus and Serena Williams, Roger Federer, Rafael Nadal make in excess of $10 million in endorsements.  Other players have multi-million dollar endorsement deals.  We add up all the estimated cumulative tennis endorsement money and divide it by the number of grand slams (4) and come up with an estimate of economic endorsement value to players of $50 million.  Many may disagree with this number and the reliance on grand slam credibility but even Anna Kournikova who had a $50 million endorsement agreement with Adidas won a grand slam championship in doubles with Martina Hingis.

Besides endorsement money, there are other economics in play.  Martina Navratilova and Rod Laver have recently been seen at the US Open signing autographs.  A Martina Navratilova autographed tennis ball sells on the secondary markets for $195, a Rod Laver tennis ball – $145.  Navratilova and Laver also have autobiographies they sell.  Vendors may generate $85 million in revenue, but they also pay some factor of that money in salary to their service and sales people who then spend it on other things.  Likewise for secondary sales agents, etc.

Intangible Economics

Lastly we have intangible economics of the US Open.  As we learned from hedge fund billionaire’s, Raj Rajnataram’s insider trading trial, the US Open is a magnet for business deal-making.   In one 3 day weekend, Raj took a vacation and made $30 million.  At the US Open, he met with Arun Sarin the former CEO of Vodafone to discuss Sarin’s launch of a Telecom hedge fund.  George Soros is known to be a player as is Bill Ackman, all hedge fund billionaires.  Many deals and meetings like this are done over the two weeks of the US Open and there is some unquantified economic impact which is of great value to New York City and probably only New York.

US Open Multiplier Effect
New York and Other Area	US Open Economic Multiplier (in Millions)
Estimated from Study ($420 million * CPI)	$   602
Vendor Sales	$     86
Ticket re-sale	$        17
Ticket Resales and On-Site Sales SubTotal	$   103
Hotel Rooms (1 day)	$    43
Hotel Rooms (2 day)	$    86
Airline	$    81
Car (transport and parking)	$    81
Airport Transportation (NYC)	$    25
Airport Transportation (non-NYC)	$    18
Parking (Parking + Tolls)	$      4
Transportation Taxi	$    17
Transportation (Subway / Bus)	$       2
Accomodations and Transportation	$ 359
Other New York Activities	$   54
Player Endorsements	$   50
American Express Memberships	$   23
USTA Memberships	$     11
Endorsements and Direct Sales	$   84
Deal-making	????
New York and Other Area Subtotal	$ 601

Sponsor Multiplier

The Sponsor Multiplier is the amount of revenue sponsors expect to make from advertising at the US Open or on television.  The total sponsorship dollars spent at the US Open exceeds $60 million.  Likewise, television revenue is roughly $60 million (and we expect television advertising rates to be far higher).  Minimally we expect the revenue generated by the sponsors and advertisers from the tourney is at least equal to the amount spent on sponsorship plus advertising.  So the net impact of advertising at the US Open would minimally have a net zero impact to the bottom line.  $120 million of sponsor and advertiser revenue gives an additional economic impact bringing the total economic value of the US Open to $920 million.

But the US Open’s core sponsors have long time relationships.   Relationships like these are developed due to profitability.  Since US Open sponsor products vary between high end and low end, we estimate the average profitability for US Open advertisers is 20%.  If sponsors are looking for a 1:1 return on their advertising dollar to bottom line profitability then we would expect the top line revenue would be 5 times profitability i.e. one fifth bottom line times five times revenue is 1:1.  So if sponsors and advertisers pay $120 million a year for the US Open, we expect their revenue generated to be $600 million driven by the tournament or a total US Open economic value of $1.4 billion.

A real world example benefits.  Let’s say all US Open ticket holders are American Express holders and spend $1,000 a year (or while on their trip to NYC) due to advertising and sponsorship at the US Open.  The Amex fees on the $1,000 is $30 and the annual fee for the Amex card is $150.  $180 out of $1,000 is about a 20% profit margin.  700,000 ticket holders spending $1,000 each on Amex due to US Open advertising is $700 million of economic value.

The reality, according to American Express financial statements, is that Amex’ corporate cardholders spend on average card a whopping $11,213 annually or almost $1,000 a month.  So the multiplier may be significantly greater.   Many of the US Open sponsors, like Amex, are headquartered in the NYC area as is the USTA.

Summary

The US Open is a powerful economic force for its stakeholders, the USTA, New York City and surrounding areas, sponsors and advertisers.   Though existing estimates hold the total US Open economic value at around $620 million for the USTA and the New York City tri-state area, when reviewed on a holistic basis and adjusted for inflation the total economic value of the US Open is closer to $1.4 billion when considering all locales and the breadth of advertising reach.

Probably the economics of Wimbledon and the other slams  are similar to the US Open in many ways which allows for the prize money they offer.

Closing Thought

Though the US Open provides substantial economic benefits to all involved it is an underperformer in the world of sports events.  If US tennis had the same crowds as in the 1980s or had maintained the same market share, the economic potential for the US Open would be 2-3 times the existing economic impact.  Next we discuss ways to improve the US Open and how the USTA’s stewardship of tennis succeeds and fails the sport.

How Much Longer For Federer and Nadal – Tennis Champion Lifecycles

After a magnificent victory against Novak Djokovic, ending the match in the 4^th set when the tennis-viewing audience would bet against him in a 5 setter, Roger Federer was the story of this year’s Roland Garros despite losing in the final to Rafael Nadal.  Federer ended Djokovic’s 43 match winning streak.  Though we stuck a fork in Federer’s future slam chances last year when he lost in the US Open semifinals in a grinding 5-setter to Djokovic ( a match as pivotal to Djokovic as Lendl’s French Open victory against McEnroe was) we aren’t surprised to see Federer reach another slam final.  Federer beat a competitive field and had the most difficult draw in the tourney.

Not to be undone, the 25 year old Rafael Nadal won his 6^th French Open championship equaling the iconic Bjorn Borg.  Nadal and Borg are European twins with equally haughty won-loss records against the field of 82.6%.   Much of their damage was done on clay.  Nadal has eclipsed Borg with a career grand slam.  He is one of only 5 modern era champs to win slams on 3 surfaces including Jimmy Connors, Andre Agassi, Roger Federer and Mats Wilander.  What makes Nadal’s record more impressive than Federer’s is that he beat Federer on all surfaces in the finals of the slams they played.

Last year we gave our reasons for Federer’s fade:  (1) He needs too many winners against a player like Nadal to be competitive, (2) He can be outlasted in a tourney and by the semi-finals or finals is out of gas i.e French Open final set, (3) He doesn’t have a major-league fastball serve like Sampras that gets him many easy points, important as you get older.  LZ  Granderson from ESPN gave all the reasons Federer is not the greatest in agreement with our prior arguments but also described why Federer would lose to Nadal in Paris.  Greg Garber from ESPN has jumped on the bandwagon as well with Tim Joyce of Realclear Sports.  Is it much longer for Peter Bodo to acquiesce?

When we look at historical tennis data, we begin to conclude that Nadal is near the end of a remarkable story arc as well.

What has been Nadal’s story arc?  Like fellow all-time greats: Borg, Becker, Sampras and Wilander, his championship play manifested itself as a teen winning his first French Open at 19 after thoroughly dominating the South American clay tour.   Later he moved onto the finals of Wimbledon at 21 years of age.   Like every other left hander to reach the finals at a young age(McEnroe, Ivanisevic), he went on to win the championships and a total of 10 grand slams with this year’s French Open compiling an astounding 47-17 won-loss record in pro finals again rivaling Borg’s final percentage.

So the question remains how much gas do either have in the tank?  Is there data in tennis history that is relevant to answering the question?  If Federer is going strong near 30 years old, why shouldn’t Nadal?

Grand Slam Championships by Age – One Handed Backhand strokers.

So what does tennis look like for All Time Great (ATG) Slam champions after 25.  First let’s talk about the data.  We have compiled data since the Open era began for all tennis champions.   Eliminating the Rosewall and Laver data due to the “Dream Team” affect i.e. pros playing against amateurs we come up with a data set that shows a typical age range for people to win Grand Slams is from age 17 to 32 or about 15 years.  More dramatically we see that with the exception of Connors and Agassi, most two handed all time greats end their championship runs around 25 years of age.   We see the limit on one handed backhand hitters winning slams as 31 years of age.

Ultimately, the test of aging in the grand slams is whether you can win 7 matches and up to 35 sets in 14 days in terrible heat and other conditions against opponents 5-10 years younger than you.   Sampras had the benefit of easy points from one of the best first serves tennis has seen and certainly the best second serve far  faster than Federer’s with as much disguise.  Its not about the aces as much as the unreturnable serves or easy setups for putaway volleys.

Grand Slam Championships by Age – Two Handed Backhand strokers.

Data on Connors and Agassi winning post 25 should be taken with a grain of salt.  Connor’s 2 of 3 slams post 26 years of age benefitted from draws where Ivan Lendl eliminated McEnroe prior to a finals match with Connors as well as Borg’s sudden early retirement i.e would Connors win a tourney with semifinalists Borg, Lendl and McEnroe, instead of Bill Scanlon?  All of Connors victories over Lendl were before Lendl’s career-defining victory over McEnroe at the French Open.

Whose Head is Bigger?

  

Agassi’s admission of Performance Enhancing Drug(PED) usage in his autobiography casts a huge red flag over Agassi‘s  THREE slams at the age of 29. At 28 and 29 Lendl, Sampras and Federer, perhaps the fittest players ever to play tennis limped into the final years of their careers having problems lasting through the later rounds. With a career decline far worse than Roger Clemens as a Red Sox, Agassi  emerged with 10 pounds of additional muscle and endurance better than the fittest players in tennis history.  Things that make you go hmmm.

Regardless, Nadal is a different style player than Connors and Agassi as he has relied on defense far more in his career whereas Connors and Agassi dictated the pace of their play throughout their careers.   We have concluded that this is the last year or two of Nadal’s challenging for slam championships.   This is based on a few changes in the tennis environment and Nadal’s aging.

1.  Nadal is losing to Djokovic on all surfaces and Del Potro has returned to tennis which will threaten Nadal on harder / faster surfaces.
2. Nadal has shown that he is vulnerable on clay to flat ball hitters like Djokovic.  And now Tsonga on grass.
3. Nadal’s game more resembles Borg where he is opportunistic rather than Connors or Agassi where they forced play.  That is a harder game to maintain as you age per Borg and Wilander (Chang, Hewitt, etc).

Though Nadal is a different type of physical specimen than tennis has seen with Popeye musculature, a boxer’s gait and a peculiar penchant to adjust his shorts on every serve, we think this may only buy him an additional year of challenging for slams.  Do we favor Rafa to win Wimbledon this year?  Yes, but we won’t be surprised if he loses either.   The US Open will depend on the draw, where DelPo and Andy Murray land and if Djokovic can find his form again by the US Open.

Nadal Sticks a Fork in Federer’s Legend

Rises to Number 2 All Time – All Surface

After 15 days and 2 rain delays, Rafael Nadal has cemented his position as the greatest player of his era.  A traditional tennis champion, he emerged as a 19 year old wunderkind, dominating the clay court circuit going on to win the French Open 5 out of 6 years and accomplishing the longest clay court winning streak in men’s history.  With victories over Roger Federer on all 3 slam surfaces the last time they played and a 2 slam win streak over players not named Federer, Nadal entered the US Open finals awaiting the winner of the Roger Federer – Novak Djokovic semi-final.

Federer was the talk of the tournament and of the sumer circuit.  He hired Pete Sampras’ coach, Paul Annacone, and played with new abandon approaching the net at every chance.   For 4 sets and 9 games Federer executed the style Annacone had burnished in the forges of Pete Sampras’ instinctive game.  But then in the last 3 games, Federer changed styles, coming to net only once, reverting to his all-court / baseline style, ultimately losing the match.

The tennis world gasped and in a moment messages went out to the tennis player and coaching twitter world that roughly paraphrasing read like this: “Federer is not 100% committed to Annacone’s strategy”, “Federer can’t win tight or long matches anymore”.   Djokovic baked Federer for 3 hours, stuck a fork in him and said “He’s done”.

The number one ranked Nadal who had measured Federer like no other in the sport (14-7 head to head record) took his 80% finals winning record into the last match of the tournament and clocked Djokovic with devastating serves rivaling Federer’s speed while laying waste to Djokovic’s serve with 26 break point chances.   The fork was in Nadal’s hands this time.  Victorious, Nadal is the first person to win The French Open, Wimbledon and the US Open consecutively since Rod Laver and he has completed a career grand slam.

In his own humble style Nadal has gone about becoming the second greatest player of all time based on our championship quality ranking, SATERICCON.  The myopic tennis media and sponsor world focused primarily on Federer, humiliating Nadal with tennis vans painted with #2 ranked Federer’s image carrying him to matches and the exaggerated coverage of the Federer William Tell commercial.  Luke Jensen claimed Nadal had peaked years ago.  Tennis hasn’t treated Nadal as the number 1 player he was in 2008, coming back from an injury, but instead went right back to Federer as number 1 as if Nadal’s on-court ferocity were a hiccup in tennis history or as if Federer would have won the French Open and Wimbledon in 2009 had he faced Nadal at either tournament.

A man of Spanish lineage hasn’t been so disrespected by the tennis world since Jack Kramer paid Tony Trabert  $80,000 and Pancho Gonzalez $15,000 on the fledgling pro tour, despite Gonzalez’ year in, year out domination of the circuit and his 74-27 record vs. Trabert.  We have already discussed how Federer is the Larry Holmes of the tennis era with Sampras as it’s Muhammed Ali, on our blog.

Nadal has emerged onto the tennis  world like the Mike Tyson of the sport leaving devastation and ruin to all those who challenged him.  While Federer was the Gentleman Jim of the sport winning in an oh-so Swiss manner, Nadal has been all fire facing off against Federer with a boxer’s gait and bounce.   He is a man supremely confident in his athleticism, skills and mental fortitude.

So where does Nadal rank on the all time – all surface list?  Nadal has moved ahead of John McEnroe and Bjorn Borg within a handful of points behind Pete Sampras.  One more grand slam victory over a talented pool in Australia or any Grand Slam to come and he will pull ahead in Sampras on an all-court basis in terms of greatness (primarily due to his dominance over Federer).

And what of Federer?  Our model re-calculates greatness based on how other players you beat perform at future Slams.  Federer is now riding Nadal’s coattails in our rankings.  Federer moves ahead of Becker to 9^th on an all court basis and is within a point of surpassing Wilander based on his record at slams against Nadal.  On a fast court basis he moves within one point of Borg at 5^th place.  Any combination of Nadal winning a slam or Federer beating another slam winner in winning a slam will put Federer ahead of Borg but nowhere close to Stefan Edberg in 4^th place.

Cumulative All Surface Rank
via SATERICCON Analysis
1		Sampras
2		Nadal
3		Borg
4		McEnroe
5		Connors
9		Federer

What is the career trajectory of Nadal at this point?  As we mentioned before, Borg retired at 25 after winning his 6^th French Open and becoming convinced he could not beat McEnroe after 3 successive fast surface defeats at Slams.  Wilander didn’t win another slam after his tour de force over Lendl at the 1988 US Open.  We think Nadal will win one or two more slams but his period of dominance is likely to be over within the next two years.

The only two handers to consistently challenge for and win slams after 25 years of age were Connors and Agassi.  Neither were counter punchers or defensive players like Nadal has been for much of his career but instead they were aggressive baseliners, hugging the lines, looking to end points quickly.  To become more Agassi than Borg, Nadal needs to modify his game significantly (as he has done already) continuing to add punch to the serve, shortening points, being more opportunistic, and more importantly, shortening his strokes.  It is doubtful even with his weight training assisted body that he will continue to be able to defend,  get around his two handed backhand or have the massive rotation on his forehand as younger and more agile players come onto the court.

Slams at Age	23	24	25	post 25	Total Slams
Borg	2	2	0	0	11
Nadal	1	2	???	???	9
Connors	0	1	0	3	8
Agassi	0	1	1	5	8
Wilander	0	3	0	0	7

And what of Men’s tennis with it’s two major brands, Federer and Nadal sunsetting and not one teenager in the ATP top 100 ?  Will tennis wise up to its ways and go back to diversified surfaces as golf has different courses?  Will it correct the error it made by slowing down 100% of the tennis court when only 12.5% (the service box) may (or may not) have been in need of change?  What about the inflated record consequences of the 32 seed era which guarantees the higher your seed, the easier your path to a title?  No  one seems concerned about the convergence in results.  Records which occurred once every twenty years have now happened 3 times in 11 years with Agassi, Federer and Nadal recording career Grand Slams.  By sheer chance Agassi won the 2^nd least compelling career surface slam in the professional error.  Rule changes instituted by the ATP and other tennis authorities allowed Federer to win the weakest career slam . This is like 3 players hitting more than 65 home runs in 11 years, it just doesn’t happen without assistance (in this case administrative).  But in tennis, records are being broken with abandon, and there are 50 men over 25 years old in the top 100 who have no chance of ever winning a grand slam.  So what next new talent in the sport is a young fan to cheer?

Next, the economics of the US Open.

SHOTS, the Hierarchy of Tennis Supremacy

There are around 1 million articles or comments on the internet about Sampras vs. Federer.  Few articles ask, in a tournament of all time greats on any surface, exactly who would Federer (the first seed by A32 rules) beat and how?  If you had to bet your last dime on who would win a tournament of all time greats, would it go towards Federer or someone else?  To understand this concept we created SHOTS, Secada’s Hierarchy Of Tennis Supremacy.  We discuss SHOTS at the midway point of this article while delving into more of Federer’s career statistics comparisons in the next few paragraphs.

Successor Champions

Successor champions occur in tennis when the prior number 1 player is on the decline or has retired and there is a succession fight for number 1.  Martina Hingis, became number 1 without beating Steffi Graf; Roy Emerson remained amateur as other Aussies turned pro.  Sampras is the only open era player to win a slam in his teens, 20’s and 30’s.  Federer never won a Sampras era slam.  He became number 1 after Sampras retired and as Agassi became too long in the tooth to compete with him as displayed in the  “rope a dope” 2005 US Open final.   With Sampras and Rafter’s retirement, tennis saw the same absence of high quality serve and volleyers experienced in the 1974 – 1980 era when the Australian greats retired.

Federer’s career winning percentage of 80.66% trails Borg, Lendl and Connors.  In the diluted A32 era, he won 16 slams, a career grand slam and reached more semifinals than others (as the A32 rules enabled).  Federer won the French Open when there was only a one time slam winner in the quarterfinals.   He lost his last 3 slam finals to Nadal on every surface.  But Federer’s career slam is exaggerated and, SATERICCON analysis shows, happened with weaker fields.  Connors was undefeated in slams  in 1974 dominating Borg on clay.  Would he have won the French Open, and completed a one year slam if he had not been banned from the tourney?

What happens when we adjust for all time greats i.e. Pantheonists who have won slams on all surfaces.  In that case both Connors and Nadal enter the discussion and Federer’s all surface slam Q-rating is last using our SATERICCON methodology.  Nadal’s supremacy over Federer is dispositive  since no other top Pantheon player has had a significant losing record on every surface against another during their period of dominance.  If Federer wasn’t his era’s best, how could he be the greatest ever?

Federer’s Career All Surface Slam Quality (Q) Rank
via SATTERICON Analysis
1		Connors
2		Nadal
3		Wilander
4		Agassi
5/Last		Federer

With SATERICCON on an all surface slam record we modify it to take only the best results on that surface during a slam victory.  Each player ranked ahead of Federer beat a field more than twice as competitive as Federer’s in their respective all surface slams.   On that basis, Connors wins over Borg on hard courts and clay to win the US Open and his grass win over McEnroe at Wimbledon are dispositive with Nadal ranking a slight second.

Nadal is a classic all time great emerging as a teen like McEnroe, Borg, Sampras, Becker, Wilander and Agassi and he won a grand slam early in his career.  Federer was unable to show an extra gear vs. Nadal on any surface, unlike a Boris Becker on grass vs. Edberg or Lendl on hard courts vs. Wilander.   We saw the limit of his game.

Federer’s 82% and declining, winning percent against non-slam winners matches Sampras’ first 874 matches at the same point in his career.   Federer’s record against non Pantheon slam winners was built on a gaudy 40-5 record against 1 time slam winners and baseliners (for the most part) such as Gaston Gaudio, Thomas Johansson, Juan Carlos Ferrero and Andy Roddick  (not a natural serve and volleyer).  Sampras’ record against the power serve and volleyers Krajicek and Stich was no better than 8-10.  Outside those players, Sampras overall record is superior to Federer’s.  With respect to matches between Pantheonists, Sampras ranks first for players with more than 35 of these matches, Federer last.

Creating a Framework for Tennis Greatness

So how do you control for rule changes and the many other variables in different eras of tennis when tennis corporatists inflate statistics and smooth the way to championships?  In a tournament of all time greats, who would win?  SHOTS is a 4 step pyramid where to get to the highest level of realization, you must first complete the prior levels.  Level one is experience as a Grand Slam winner.  Level 2 is experience as a top 16 Grand Slam winner (Pantheon level player).  Level 3 is won-lost percentage vs. other Pantheonists as reflected in SITDON analysis.  Level 4 is the difficulty of slam championships won using SATERICCON analysis or Slam Quality (Q) Rating.  So although one can argue that today’s players may be taller, stronger and use better equipment or that the fields have been diluted due to rule and surface changes, they can’t argue the number of slam winners at any one tournament or their head to head record.  It is known data.

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Our Hiearchy of Tennis Supremacy is dominated by SITDON – Normalized head to head record and SATERICCON – Normalized difficulty of winning a slam.

GOVERNING TENNIS PREDICTIVE MODELS

Tennis is governed by a few 80-20 rules of match play.  After 3-5 matches it becomes settled science as to who will win 80% of the time if one player shows dominance over the other, moreso in a slam with Pantheonists as seen in this year’s Wimbledon final between Nadal and Berdych.  The lone caveat is a “breakthrough” event when a player reaches another level of tennis such as Pete Sampras after his loss to Stefan Edberg at the 1992 US Open or Ivan Lendl after his French Open victory over John McEnroe.   They both went to a next level of greatness, dominating most opposition and fighting the remainder to a draw at worst.  In contrast, each time Federer lost to Nadal, he came back and lost worse the next year.  Watching Nadal’s career progression shows that Nadal has an extra gear that Federer doesn’t.

Absent match competitive data, style of play matters, certain players have a style that beat other players.  Kick serve and volleyer Rafter dominated Federer, similarly styled Edberg may have the same result.  Left handed Nadal dominated Federer at his prime, then left handed, kick serving McEnroe, a clutch player, may have a significant chance against Federer.   Or if Agassi who hits off the bounce early, dominated Federer, then Connors a similar lefty may have a chance against Federer and his backhand.

And finally, youth triumphs over experience when there is a significant age difference and mileage.   For example, Jimmy Connors overall career record vs. Pantheonists is less than 40%.  When isolating for when he was at his peak i.e. younger than 31 and eliminating players over 31, his normalized performance was 57% about the same as Borg.  And of course a young Federer beats a 35 year old Agassi.  Next, SITDON analysis of the Federer record – crunching the numbers.