US OPEN

September 9, 2004

Larry Scott

LARRY SCOTT: Why don't we get started. Good afternoon. We wanted to try to get this started and try to be done before the Agassi-Federer match gets going. I know you all are focused on getting out to that. I wanted to take the opportunity of being here at the US Open to make some announcements about the new long-range strategy that the WTA has adopted and some very specific changes that are going to be put in place for 2005 as for steps to what we're calling Road Map 2010. These changes and the announcements of these changes comes at a time where in the last 12 to 16 months, when I started at the WTA Tour, I felt like we've made tremendous progress in terms of new sponsors on board and new marketing strategy and many new initiatives in that regard - enhanced player involvement and accessibility, a restructured organization in terms of our board structure and the formation of a global advisory council with world-class business leaders that met for the first time here, and many other positive things happening on the court as well as off the court. Over the last year, we've engaged in a lot of discussions and meetings with all of our key stakeholders, with players and tournaments as our members, with our commercial partners, and with other governing bodies - including the ATP, the ITF, and the Grand Slams - in terms of determining a vision for the sport and specifically a long-term vision for the WTA Tour as we set our sights on structural changes to the actual circuit itself. This is the culmination of a lot of work that's gone in over the last year on this, and we've gotten our organization rallying behind a unique and, I think, powerful and exciting vision for where women's tennis is going. Specifically, under this heading of "changes we're going to make to the circuit structure," it's going to start with going for a shortened season. The aim is to bring the season to 10 months in total. Right now, there's a five-week off season, and our goal is to get to an eight-week off-season at a minimum so players have a full two months off. So the 10-month season is something that's one of the cornerstones of this plan. Secondly, a better packaged series of tournaments, specifically greater clarity in differentiation between the tiers of tournaments that we have on the WTA Tour, and specifically the creation of a new tier, of mandatory events for players at the top of the game that all players play that we think will lead to greater rivalries and a greater, more compelling and easier to follow packaging for fans. Looking at simplifying the ranking system for fans to understand as well as continuing the efforts we've made over the last year toward greater cooperation with other governing bodies - like the development of the US Open Series, like the one game initiative with the ATP. We'll continue to pursue other initiatives like that related to governance of the sport as well as specific promotional initiatives. So that is some of the cornerstones of the long-range plan. Some of the specifics that you'll see for next year are already a shorter season. We're going to be shortening the season by two weeks next year. The way we're going to do that is through a cooperative agreement we've reached with the ITF. The Fed Cup final will be moving from after The Championships to the week after the US Open. With eight teams in the world group next year, that means the final round will take place after the US Open, and the season will end for professional women's tennis at our Championships in LA. This will take the season from five weeks to -- the off-season, sorry, from five weeks to seven weeks next year. Then the following year, the Australian Open has agreed, some of you know, to move later, one year, in January of 2007. That will essentially give us another week of the off-season. So in a two-step process, over two years, we're going to go from having a five-week off-season to an eight-week off-season. For 2005, we're moving to a slightly more clear and differentiated structure as a first step by going from five tiers of tournaments down to four, as well as changing the rules between the tournaments as to where players can play. So we've got something on the WTA Tour called a "Play Down Rule," and there will be greater clarity about where the top players can play between Tier Is, Tier IIs, Tier IIIs, so on. Those are some of the specifics you'll see next year already as the first steps towards this longer-range vision. We also now have a report from the age eligibility review panel that looked at our professional development programs. And as part of this long-range plan we will be putting in place additional programing in terms of professional development and education for the players. We'll be looking at the rules that govern age eligibility now that we've received the report. We've got a blue ribbon panel of independent experts that have prepared their findings after extensive interviews - several hundred interviews that they've done through questionnaires, as well as open forums, and they've delivered us a report, which we are making available today to anyone that wants to see it, with a summary of their findings as well as directional recommendations for the future. We're taking that on board, having meetings already starting already this week with the leadership of the ITF and the Grand Slams to discuss the findings in an attempt to have a coordinated approach toward professional development and any age eligibility restrictions. We will then, as a next step, look at any changes that we want to make on the WTA Tour in terms of the rule itself and in terms of professional development programing. So there's a lot of work to be done. As I've been able to summarize, some very important first steps in concrete changes for next year in terms of the season and our circuit, but also now for the first time we can really outline the vision that we're really working toward in terms of the circuit structure itself. Happy to take any questions anyone has about any of that or other topics.

LARRY SCOTT: Yes. We have worked over the last year in close collaboration with our partners, AEG and Octagon, on looking at a lot of different alternatives for The Championships. As I said last year, our agreement with AEG and Octagon contemplated The Championships could leave Los Angeles as early as this year. In fact, we had a lot of interest in The Championships from different parts of the world, and a lot of serious interest particularly from China with all the excitement leading up to the Olympics. Looking at all the issues, we decided together that it made sense to not pursue those at the time; that we were very pleased with what happened at The Championships last year, we were very pleased with what happened at the Home Depot Center this year in terms of the development of our tournaments in the LA market, and for a variety of reasons determined it's in all of our best interests to stay in LA one more year. We're leaving open the possibilities about what happens after that because it is an agreement with AEG and Octagon that contemplates the event would move around the world, but we're here today to announce that it's on our calendar in LA for 2005.

LARRY SCOTT: We had a lot of discussions with New York. That was one of the options we've pursued over the last year.

LARRY SCOTT: Well, we've got near 60 tournaments around the world, we've got all different kinds of models. We've seen tournaments be successful in urban environments, resort and suburban settings. We were pleased with the improvement in terms of the attendance last year. There's going to be a significant big push in terms of this year's event. I know a lot of marketing efforts are being put into it, especially with the NHL season on hold. I know there's a lot of assets and resources that AEG and Octagon have that they are applying to this. I'm expecting it's going to be spectacular. We believe it can be very successful in that environment.

LARRY SCOTT: I know we've got 2005 compared to 2004 numbers. I don't know off the top of my head what 2004 was compared to 2003. I'll get you that answer.

LARRY SCOTT: Some of the summary findings - and we'll make the whole report available to you - first of all, there was a remarkably positive reaction from the people interviewed, players, coaches, family members, media, about the program and reinforcement for this professional development program and age eligibility restrictions. One of the findings was that players' careers are lasting 24 percent longer than they were 10 years ago when the first study was done. There was only one, since 1995, Top 150 who player retired before the age of 22, compared to 29 players having retired before the age of 22 - sorry, before turning 18. These are players that began their careers before 18 that retired before 22, pre an age-eligibility rule. So there's quite a few positives coming through in terms of career longevity, in terms of the health of players. Directionally, there are recommendations related to education, professional development, feeling that the tour should continue on a path of doing more in that regard; greater collaboration between the junior circuit and the tour level as well as the Grand Slams and what happens at the WTA Tour. And those are some of the high-level directional recommendations. There's more specifics and, as I said, we're going to make the report available to anyone that wants to see it. We've got a document that's a summary of the findings.

LARRY SCOTT: It was one of the most pleasant surprises. In looking at it, there have been very dramatic positive impacts of having this rule in place and the educational programs. Ten years ago, when the rule got going, the focus was on the rule, and then there was some sort of educational programs and professional development that seemed to be in a way an afterthought or something that should go with it. Now the panel is coming back and saying they actually think it's the professional development, the education that's having the greatest impact in preparing players for what they are going to expect in terms of life on the tour. There is more preparedness than there was in the past. That seems to be the more important focus than necessarily the rule itself and restrictions on how much players can play. There's a lot to digest. There's a lot we're going to consider and discuss with the ITF and the Grand Slams. We have reached no conclusions about any changes we might make to the rule. We have reached conclusions that we have to invest more in professional development and education already; that's obvious from seeing the findings. But in terms of how it impacts the rule itself, that's something we're now going to have to dig into further.

LARRY SCOTT: Well, I'm flattered to be asked and considered. I've got a lot of regard for the job that Mark has done. I've got an enormous amount of respect for him. I think he deserves a lot of credit for where the ATP is today, and there are certainly some very big shoes to fill with whoever takes that position. But I'm thrilled with what I'm doing here today. Judging by the announcements we're making today, we've got some bold plans, and I'm very committed for the future and I have every intention of staying put here.

LARRY SCOTT: Well, I was very disturbed to see what happened on court and to see the instant replay and missed calls, bad calls at critical moments, especially since it overshadowed what was probably the best match of the US Open so far in terms of drama and excitement, two great champions. I think it's a shame for Serena, it's a shame for Jennifer that that's been the focus, as opposed to a great match and tremendous story in terms of Jennifer's comeback yet again and her chances here at the Open. That being said, I think we can't be satisfied with not having a better system for officiating and reviewing line calls. It's something, obviously, that tennis has been focused on for some time. We've got the Cyclops, we've got an electronic net cord system, so there is technology involved with calling lines already, none of which are perfect. We still see that we've got service linespeople out there overseeing the job that Cyclops does from time to time, and we do see overrules on the electronic net cord. I think technology so far in tennis has not proven to be a dependable substitute for human involvement. We've also been very involved in testing electronic line calling systems over the last year. As many of you will remember, the Tell system, an Australian company that came along that we tested with. As recently as last week, the WTA Tour has been working with the ITF and the ATP on Auto-Ref, the latest iteration, and looking at HawkEye and these other systems. I remain very, very interested and committed to exploring any technological solutions to improving line calling, but so far there's been no ideal solution in terms of electronic line calling itself. We will continue to pursue testing. I'm going to be meeting with our team here that was involved in the Auto-Ref testing over the next several days, getting a report from them. Then determining what we do on the WTA Tour is the next step in that testing. Separate and apart from that, you've got this issue that's been kicked up over instant replay, which is not really a line calling system per se. I think it's an interesting discussion. It's something I definitely think we have to consider more seriously. It's being discussed to address an issue of fairness and making sure we've got the best calls possible. The obvious inherent conflict you have is that an instant replay system is not available to you for all matches on all courts, so there's a built-in unfairness to the idea of using instant replay just on select televised match courts. If you look at the circuit in total, if you look at Grand Slam matches in total, there's a real hurdle we'd have to get over in terms of accepting that you'd have a different standard of line calling at certain select TV broadcast matches than you'd have at every other match in the tournament. So far, that's a sacrifice people have not been willing to make. Maybe the debate about what happened here the other night will bring more of a focus to it. We may rethink that. Up until now, that's not a step that we've been comfortable taking.

LARRY SCOTT: I think it's a question of degrees. It's a fair point. The system of calling lines, I think, is at a level of importance and seriousness beyond speed serve, in my opinion. I'm not saying people couldn't get there in terms of being willing to make that sacrifice, but up until now I think that's the reason people have shied away from instant replay.