U.S. Open On Pace For Around $200M In Revenue, $110-115M Profit

The U.S. Open is "on pace this year to have its second- or third-best financial performance ever, despite the down economy, with roughly" $200M in revenue and a profit between $110-115M expected, according to industry sources cited by Daniel Kaplan of SPORTSBUSINESS JOURNAL. All 85 suites at the Billie Jean King National Tennis Center are "sold for the event," and the sources said that attendance is "expected to reach 675,000, trailing only the last two years." Attendance is "expected to drop 6[%] from last year's record of more than 720,000, though the grounds during the two-week tournament would still be at" 95% of capacity if the event hits projections. The overall projected revenue for this year's event is down from $208M last year, and the "main contributor" is a "long-ago planned reduction starting this year in cable and broadcast revenue." The USTA budgets broadcast and sponsorship revenue together, and it is projected at $118-120M this year, down by $10M from last year "because of the lower fees from CBS Sports and the new deals with Tennis Channel and ESPN." Sponsorship revenue is "flat, and international TV money is up." Due to "ticket price increases, ticket revenue is projected to increase." Ticket and suite revenue is projected to hit $68M this year, and the Open "hopes to equal the about" $13M in corporate hospitality and concessions brought in last year. Meanwhile, Kaplan notes the event in recent weeks "has sold new sponsorships to Stonyfield and to SpongeTech that brought in about" $2M in revenue (SPORTSBUSINESS JOURNAL, 8/31 issue).

NEED TO GET CREATIVE: USTA Exec Dir Gordon Smith discussed the sales effort arounf the tournament, noting, “Have we had to be a little more creative? Yes, we have. But in this economy we're doing very well." Smith noted the organization is putting together “packages for our suites for only half the tournament.” Smith: “It's less expensive. But I will tell you, I think we've seen the economy turn around and you should understand sponsors feel better about bringing guests out here than to many sports events" ("The Call," CNBC, 8/31). Tennis player Bob Bryan said, "If you go out there, you'll see just packed crowds. It's sold out for two weeks straight. So the tournaments are doing great even though we're in tough times." While admitting that all sports struggling some in this economy, Bryan said, "The U.S. Open is $20(M)-plus in prize money this year for the players, which is awesome" ("Money For Breakfast," Fox Business, 8/31).

SPONSORSHIP REVENUE COULD DROP: BLOOMBERG NEWS' Danielle Rossingh cited the USTA as saying that U.S. Open sponsorship revenue "may drop as much as" 3% from $55M last year, as the event "lost Minneapolis-based Valspar Corp." as a sponsor. Meanwhile, the tournament "extended an agreement" with IBM through '12, and Massachusetts Mutual Life Insurance Co. and JPMorgan Chase "also continue to sponsor the event." ITF President Francesco Ricci Bitti: "The Grand Slams are not in trouble, they are great operations. They are more than tennis tournaments; they are events" (BLOOMBERG NEWS, 8/26). 

FAILING TO MEET EXPECTATIONS: In Connecticut, Chris Elsberry wrote the ATP World Tour portion of the Pilot Pen Tennis tournament has "done well, possibly even better than expected, but that hasn't translated into the kind of additional dollars" that Tournament Dir Anne Worcester and Connecticut Professional Tennis Principal Butch Buchholz "were hoping to gain" when they combined the men's and women's events in '05. Pilot Pen Tournament Chair Mike Davies: "When we took over the men, we took on a huge number, a million more dollars of overhead. That's not translated into extra ticket sales and not much more in sponsorships. This year, it's been the economy, last year it was the Olympics." Davies added, "We haven't taken a loss on the books yet. This year looks like it could be a loss. We're certainly going to try to extend the men's event." Davies said the USTA is "happy, but we have to look at the whole thing" (CONNECTICUT POST, 8/30).