US OPEN

August 28, 2006

Etienne de Villiers

DAVID HIGDON: Welcome. Etienne is here. All of you probably would have seen our release yesterday about some of the changes we're going to implement in 2007. If you guys have any questions, fire away on that or any other topic.

Q. Could you just be a little more specific about which tournaments may go to Round Robin and which ones may start on the Sunday.

ETIENNE de VILLIERS: The answer to that is we'll experiment for the next couple of years and see. Initially, we thought that the Round Robin should be a programing device that would actually bolster the smaller tournaments as a result of the emphasis that we're placing on the larger ones.

Then when I met with Roger, Rafa, Marat and Andre, Rafa and Roger said this is just such a great idea, why don't you do it on the bigger tournaments. So we then went -- our thinking then went to let's make it an exclusive of a category within our premium tour, if you want.

The demand within the tournament group has been such that we kind of figured if we were not going to implement the roadmap until 2009, let's go figure out how it works, what the fan reaction is, what the media reaction is, what the tournament economics are, obviously what the player reaction is.

I'm a great believer in doing it, trying it and fixing it rather than trying to get it right.

Q. The question is, like what tournaments? Have you designated, looked at what tournaments?

ETIENNE de VILLIERS: Anybody who feels they'd like to do it. What we've come to is, because it does place a load, not necessarily an extra load on the player, depending on the size of the field, it does actually put a load on the timing. So we're probably going to mandate for the experiment for next year. If you want to entertain Round Robin, you need to have the eighth day. So anybody that wants to try and do it, if it gets to be unmanageable, we may actually have to screen it. At this stage we're just asking for interest.

Q. The tournament director comes to you and says, We want to try this, it's going to be up to the tournament directors?

ETIENNE de VILLIERS: The tournament directors, yeah, it's an option in 2007. A lot of the tournament directors have already come to us and said they'd really like to try it. We won't obviously do it for the Masters Series. By definition, it will be the International Gold category. Then when we restructure the tour in 2009, we'll have a lot more data.

Q. Under the current format, tournament director is going to pay for a hotel room for five days for everybody knowing that half the draw is going to be out after Tuesday, and a lot of those players are going to leave and he can thereby save money on hotel rooms by canceling remaining accreditation. Saves on food, transportation. Under the new format, they'll have to play for everybody for a minimum of three, four days. Who's going to shoulder the economic burden there?

ETIENNE de VILLIERS: Well, we are looking at the economics. We've actually got Deloitte & Touche to do a study on the financial viability of the tour. If the incremental cost is of housing and feeding and transporting those players the extra day is going to make the difference, we're going down a blind path here. It can't be that sensitive.

What we're going to have to do is make sure this makes for a much more entertaining product, a much more fan-friendly product, a more media-friendly product. Hopefully that just lifts the whole thing.

It's not been raised, interestingly enough, by any of the tournaments. All of them who want this, it's never been an issue.

Q. Are you leaning towards a certain format, like a 32-draw, eight groups of four?

ETIENNE de VILLIERS: We originally started with the notion that the category of tournaments that we were going to create which sat below the four Masters, combining the four men's Masters, would be a 64 draw initially. We're now convinced that it should probably be a 48 draw to give us 16 by 3. You don't have any dead matches and then you then take 16 and go through on knockout.

On 32, it's probably going to have to be 8 by 4 if we're going to experiment with that. That's the very smallest field. We are also pretty convinced that although it's not a decision that a 56 draw makes more sense in the Masters events, given that you will allow the top eight to have an extra day's rest, I'm really concerned that we are creating a rod for our own back. We've seen it now too often this season. These athletes now have the ability to play the stroke play that the athleticism, the sheer talent is such that longer rallies are almost inevitable, longer matches are almost inevitable. We have to be cognizant of that.

We had a very interesting conversation with the doctors last night. I tasked the doctors with a challenge to get to scientifically understand cause and effect of physiology, racquets, technology, balls and surfaces and to see whether there's any correlation with that and injuries, so to see whether we can actually get ahead of this. There isn't just a single bullet.

I sort of segued off here, I'm sorry.

There isn't a silver bullet for curing the problem of player injury. It's not just about the length of season, but that's a factor. It's not just about the intensity of the calendar, but that's a factor. It's not just about technology and balls, but that's a factor.

We really have to get into all of this and try and understand.

Q. Round Robin question. Are you worried about players tanking what might be a meaningless match? Do you think the prize money and ranking points will be enough to keep those competitive?

ETIENNE de VILLIERS: I think that's always the problem that you've got. Whether it's a question of tanking, which is a word I think we won't use today, I think we've had enough speculation of tanking this week. It's just a question of whether a meaningless match is, in fact, an entertaining product. That's more of the issue. Do fans really like to watch friendly matches as opposed to meaningful matches? I think that's the issue with a four-draw Round Robin or four-team Round Robin.

These are issues we are all looking at. This is why we initially contained it to the 48 draw because it did have that configuration.

Q. What do you say to the purists who might say by going into a Round Robin scenario, you're taking away the competitive edge of the knockout competition?

ETIENNE de VILLIERS: Yeah, it's a valid observation. I would say, at the end of the day, I think fans care more about the entertainment value. I think the average fan would like to see the players that they would like to see. At the end of the day you'd like to see a stronger field go through into the quarterfinals and semifinals. You're probably likely to get that. That's the argument I think Chris has mentioned, it's unfair, it eliminates the lucky winner.

That's the trade-off. Ultimately, is it fair that footballers, the World Cup in football is settled with a penalty shootout? I think a lot of the purists would say you play until you drop, then you drop and you play again. So we've had replays and stuff. But at the end of the day we're in the entertainment business as well and we have to be cognizant of what the media and television want.

The Round Robin is a really television-friendly device. You can promote and schedule matches. You know when they're going to happen. That's the trade-off. There's always going to be the trade-off between the Corinthian view of sport and what's best entertainment. We saw this with the line calling. There was one of you that said, if the technology is available, use it and, you know, every call can be challenged. What we've discovered is, fans love the fact that it's actually a feature, "Call it, challenge," they're involved with the process. It's in, it's out. It matters. Who knows.

Q. Do you run the risk that players who say, I mean, in a pure knockout they have a chance to go through and they wouldn't have as great a chance to go through if it's a Round Robin, that you run the risk of possibly the players lower down, ultimately cutting their income, and you may weaken the game from the bottom up?

ETIENNE de VILLIERS: Again, I think it's a valid question. The issue with everything is, what is your spectrum, how important is it to grow the game. If we grow the game and it gets better, relatively they may earn less money - poverty being a relative concept, not an absolute one. But overall, we'll be earning more money because we'll be making a stronger tour, we'll be on television more, sponsors will be more interested, fans will come, etc., etc., etc.

I'm what my wife calls an Armani socialist. It's easy to be socialistic when you're comfortable.

I do have a real sense of concern that whatever system we put in is as fair and as just as possible. Against that, I have to say, is it fair and just to spread it around when you're not growing, when you're going backwards in order to feed the needs of all, or do you actually aspire to growing it, and in the process, in the short term, relatively deprive those that have less because in the long term they'll have more? It's Philosophy 101.

I happen to believe we have to take care of the sport, you have to take care of the growth first. If there are a few that suffer in the process, then in the short term -- if the short term the medium or long term for some players, I'm afraid that's the price we pay. That's the problem. We do have people, players who have got short careers and some will get hurt. I understand that.

Q. We're talking about in a 48 draw 16 seeds getting 16 seeds and one seed in each of the 16 groups.

ETIENNE de VILLIERS: Right.

Q. Now that means that those players will have to play six matches over eight days instead of five matches over seven days.

ETIENNE de VILLIERS: No, six matches. Because what we would have done, we would have had the 64 draw. We reduced the 64 draw down to 48. Less jobs, we understand. But it's the same category of tournament that ordinarily would have required a guy to play six matches. He's still going to play these six matches, just against a smaller field.

The 32 draw, you're right, there is an extra match. Again, I would argue, on the 32 draw, it's probably a smaller tournament. The guy who's likely to go through, as we've noticed with some of our smaller ATP events, the lower guys go through, which is great. They are not the guys getting this increased mileage on their clocks. The guys we want to be concerned about are the guys that are your top eight, ten, twelve players in the world. Those are the ones we want to protect and avoid having to play too much.

Q. You are going to make this available to 32 draws?

ETIENNE de VILLIERS: In the initial stages, sure.

Q. That means that those players, instead of playing five matches over seven days to get to the final, will play six over eight days.

ETIENNE de VILLIERS: Yes.

Q. How does that influence your top players not to play doubles after all the work you've put into convincing them --

ETIENNE de VILLIERS: I'm just going to beat the crap out of them if they don't (smiling).

No, I don't know what the answer is. I think we're giving them an extra day. In a sense, that should take care of it. We're also going to try to make - we haven't agreed yet but we're certainly talking about making the Round Robin part a match tiebreak in the third in order to get it shorter. We haven't finalized that, please. These are just ideas we are having. So as we can get the schedule to work, we can get it to be more (indiscernible).

Q. What's interesting about tennis and golf, they are sports that people that watch it actually play it. Football and baseball, you play it as a child. Soccer, maybe people play a little bit older. To make such fundamental changes to a game that people understand and live and play. I mean, in doubles I've sat with people that say, What's happening now? Why are they doing that? Now, you're going to make fundamental changes to tournaments. These are exact -- your tournaments are not very different than tournaments that people play at home in the USTA or in their other countries. To keep making such fundamental changes, don't you fear that you might lose fans? You might lose interest? Not only the purists, but people that play it one way and the professionals play it a completely different play.

ETIENNE de VILLIERS: Shocking, isn't it? Shocking that we can change this game in 200 years, I mean, when every other game has changed. Kids take two seconds to figure out what the rules are. 70% of the people that we polled, of the 305 people we polled, which is a statistically significant sample, at exits at Cincinnati and Toronto understood it. 95% have said they got it. More than half of them have said they enjoyed it, the rules. These are the purists, by the way. These are the guys that pay money to come watch doubles.

I'm convinced the experiment is working. If you can get a nine-year-old to program a computer to today, you don't have to be a genius to work out what the changes are in the scoring system of a sport.

I was at Queen's the other day and Gael was playing at the Queen's Club and I went down just to go and watch. It was getting late. The guy said, Let's play the ATP system, no ad rules. I said, I love you guys. They didn't know who I was.

So, you know, you're right in one sense. The purists say we should never change, but you can never ask any sports person, any player ever to change the rules. If you'd asked football goalkeepers whether they like the back-pass rule that they now introduced the last three or four years, not one single goalkeeper would have said, yeah, sure, I'd love to, places me under jeopardy, I've got to make ridiculous -- I have to learn all sorts of new skills, I'm gonna make howlers, be an idiot every so often. All of that is true, but it's made the game more interesting. What have they done just in hockey right now?

Q. I'm sure you've spoken to a number of tournament directors of facilities, especially the indoor ones, that would have difficulty hosting the Round Robins because the sheer number of matches would be too much. Why not consider going to a 16 Round Robin? Why go to the 32, given that most people are coming to see the top players anymore? Maybe qualify into some of those 16 spots rather than having so many facilities who are already having problems scheduling matches and running matches until one in the morning under the current format, basically looking at what you have now where it's going to be just impossible for them to run --

ETIENNE de VILLIERS: I think the -- I don't have Gayle here. I go to Gayle whenever I get these questions that tax my limited knowledge of this game.

I think we worked out the number of games is actually not significantly different with an 8 by 4. I think the maths -- you could do the maths, you'll probably end up finding it doesn't change that much.

Eight by three is 24, plus four and two, you get to 30 matches.

Q. Single elimination, you eliminate matches every day. Over four days with the Round Robin, you'll have the same number of matches.

ETIENNE de VILLIERS: You have more matches at that level but less matches when you go forward. You actually still end up with 32 matches I think somehow.

Q. You're also going to make a significant improvement in prize money.

ETIENNE de VILLIERS: Yes.

Q. Where is it going to come from?

ETIENNE de VILLIERS: From the journalists (smiling).

Q. How does tennis afford that?

ETIENNE de VILLIERS: That's a good question. Initially, it's a leap of faith. We say if we're not going to celebrate the fact that we belive our sport is strong, nobody else is going to. The 10% minimum prize money level was a decision that was made, dare I say not with the full-hearted support of the tournaments. Turkeys do not vote for Christmas or Thanksgiving. You're not going to get tournaments that are going to volunteer prize money increases when there's no formula.

But that said, what it does and what we've noticed is that Richard, who's sitting on your right, is selling sponsorship. There's a sense that the sport is growing. There's a definite sense that there's a following wind here. We're talking to broadcasters right now about renewing our TV rights for 2008/2009. There's a significant 15, 20% per annum uplift on television revenues. We've just renewed a deal - I won't mention the category - but for the ATP where we renewed it at a 97% increase over the last deal.

The money's got to come from somewhere, absolutely. But there's a sense that if we market it better, if we promote it better, if we get it better structured, it's not a Field of Dreams notion about "It will come." It will come because you will be able to charge more for your ticket prices. You will be able to charge your sponsors more. You will get more coverage because you've got better television. You've got more stars that more people care about it. It's kind of a virtuous circle.

But it's got to start somewhere. The players we felt weren't going to step up and make the commitments we were asking of them to tighten withdrawal rules, which we hope to introduce, to do the show proud unless the show stood up and said, "It's a show worth being proud of."

Someone's got to break that cycle. We have had not a prize money increase. Since 2000 and 2004 it went down 5%. We had to break that cycle. We think and we hope that the structure that we're putting in place and the system that we've got is actually going to bear fruit. But rather than it be a complete leap of faith.

Q. When you say it has to start somewhere, it starts with the public buying the ticket?

ETIENNE de VILLIERS: It started with the tournaments putting up the prize money for a start.

Q. He's got to recoup that money. The ticket prices will increase?

ETIENNE de VILLIERS: Put the ticket prices up, more sponsors, more television revenue, more merchandising, more food and beverage. A lot of it, you don't have to increase the prize, you increase the volume. A lot of tournaments, I think you might have noticed, our sport is played by looking at stands like this and not too many empty seats. We still need to market the sport better. We need to promote the sport better.

Our audiences are fans that used to watch their when we's: When we watched Sampras, when we watched McEnroe. We've not got the 25-to-34 target audience or the 16-to-25 audience that the cinema industry embraces. We've not really got them to embrace tennis. It's an older sport.

Q. Have you done research by Europe and North America, it seems that you might be oriented by American standards here. What if you take it out of one group of people to bring it to the others because there are more of them and then don't accept it? How can you get back to the old group who lose when you change the game?

ETIENNE de VILLIERS: Which old group?

Q. Well, the people who wanted tennis that was 200 years been playing already. ITF does that, and that's a system that is going to stay. ATP is going to change.

ETIENNE de VILLIERS: Have you looked at the figures on television audiences for the Davis Cup? Have you looked at the figures for the BBC's coverage in their own market of Wimbledon? The share has gone down from 22% in 2001 to 14.2% this year. There was a small football tournament on this year. That might have influenced it. But it went down from 14 to 19 to 16 to 18. Despite the fact that you've got the best two players in the world, the best two players the world's ever seen probably playing at the same time, certainly the last ten years, right?

So let's not bluff ourselves. The rest of the world's moving forward. The rest of the world's moving forward because they're promoting the sport, they're marketing the support, they're innovating it, making it more fan-friendly. I'm the biggest cricket fan in the world. I watched with my father when I was 19 years old every single day of every single five-day test match, as sad as it might sound, South Africa versus Australia, because we kicked Australia's butt. That's another story. 25 days of cricket I watched. Would I have the patience to do it now with my son? I don't think so because my son would not want to do it. But he'll go watch a one-day cricket because it's really exciting. The rules have changed. The same old buffers that used to watch cricket with their very nice ties and their very nice hats are watching one-day contradict, too. You can move traditionalists towards a more exciting game.

You have to honor and respect that game. We're not going to be disrespectful to the sport of tennis. It has got too much going for it. What we are going to do is innovate around the edges. I don't think that an eighth day which is going to celebrate families and new fans and casual fans coming to the tennis is going to harm or in any way offend the traditionalists, nor do I think that a Round Robin is. Because you know what, they used to play the World Cup football by straight-out elimination. Now you've got Round Robins. You know what? It's fun. It's exciting.

Q. What I don't understand about the whole prize money, we all know the guarantees take up the lion's share of tournament compensation.

ETIENNE de VILLIERS: That's not true.

Q. We have tournaments that are offering $350,000 in prize money, pay out a half million dollars regularly to get the stars. If the stars are buying into this, why not get rid of guaranteeing all together?

ETIENNE de VILLIERS: From your lips to God's ears. It's just never going to happen, unfortunately. You can't stop the tournament director asking a player to go and open a fridge for $350,000. So that's the issue we've got.

What we're trying to do is we're trying to build a tour that will celebrate and sufficient programing or sufficient tournaments that will tell a real good story about what this calendar of ours is all about. I am a complete and absolute sports fan, right, a sports junky. In South Africa, you are defined gay as a man if you prefer women to sport, right? I am a complete and absolutely sports fan. But I didn't get tennis at all until I came here. I had no idea what this Masters Series was.

Q. Do you now?

ETIENNE de VILLIERS: Do I now? I was hoping you'd tell me.

So, you know, we need to start by just telling a better story. We tell the story better. We tell a story that is based and focused on the Slams with these swings. We'll get there. If on top of that we can promote a number of players so that we now no longer say, when a tournament tries to get its stars and has to pay $350,000 to get one of the five so-called stars in the sport, we've got 20 stars, then you got to start asking the question of yourself, who's here rather than who's not here. Because we've got into this habit of saying, who's not here in the draw. Well, Hewitt and Federer didn't make it. Well, you know, you don't say that when you watch Real Madrid play Arsenal playing football. If Thierry Henri is not playing, it's still Arsenal. If Ronaldinho is not playing, you'll still go watch Barcelona.

We have to build more equity and value into our sport, into our events. None of you here is asking who's not here because nobody is not here. But, you know, there were times when the top clay guys wouldn't even bother to play Wimbledon. I don't have aspirations to be Wimbledon, but there is a great brand that has built over time and has a real resonance with consumers, casual consumers, too.

That's the task. We've got to do that. You get people to care. You have enough fans. There is so much going for the sport. There's so much going for media right now, we've just come from a symposium where Bob Bowman was talking to us about major baseball league's, you know, new media or digital media.

How many, 399 -- no, they average 20 million page impressions a day. Over a million, billion. They have something like 390 million downloads of matches. There's huge opportunities to get our product to the fans. How you manitize (sic) it is another issue. What you have to do is get more of the fans who used to like tennis, more of the fans who play tennis but don't watch it on television, more of the fans who should be into tennis to come and enjoy the sport. It's gladiatorial. It's the best head-to-head contest you'll see in any -- in any endeavor. There's nothing quite as exciting as this. Boxing matches don't last for three hours.

We're just not getting enough of this in front of enough people. Once you do that, it kind of takes care of itself. And the guarantee issue is not as endemic as you believe. It's probably 20 to 30% of prize money, we believe. It's concentrated in patches. It's determined by the lack of likelihood of attracting players to the right tournaments, and so we've got to make the calendar more friendly so you can actually get more players to more tournaments.

Q. Which tournaments have suggested they be first, or is the tour going to suggest two tournaments?

ETIENNE de VILLIERS: You have to get here in time. You can't ask questions that have already been asked.

Q. Australian players have lost.

ETIENNE de VILLIERS: No, it's a fair question. Anyone can apply. We'll review it all if it's too many people. But thank you for coming, Craig.

Q. If you have a 48 draw, 16 groups of three players each, it seems to me one of the chief advantages of this system, if not the chief advantage, is the fact that a player like Roger Federer, Rafael Nadal loses a match, he gets a Mulligan and gets a chance to stay in the tournament and you don't lose your star attraction to the tournament. If you're going to play only two matches, what are the chances that all three of those players are going to finish 1-1 and move on --

ETIENNE de VILLIERS: A good chance.

Q. -- to the next --

ETIENNE de VILLIERS: No, no, no. Every game counts. Every game counts. Because it's going to be a count back on a number of games won. Game difference.

Q. There will be a tiebreak system, of course. What are the chances that let's say Federer goes to a 48 draw, gets thrown in with two other players, loses his first match, wins his second match. He wins his second match and is 1-1. There's two other players in there. What are the chances one of those guys will be 2-0? You'll lose Federer anyway. Whereas if you have a 32 draw tournament, there's a better chance if he finishes 2-1 that he'll still be able to move on to the knockout round.

ETIENNE de VILLIERS: Well, the counter argument is you can't make it too easy for these guys, right?

Q. The whole idea was to...

ETIENNE de VILLIERS: No, no, you're right. I'm sure there's a smart answer. I'll have to think about it. When I wake up at 3:00 this morning, I'll phone you, shall I?

Are there any other questions? You must be tired of me by now. I am tired of me by now. Anything else?

Q. Just a question about what the current position of the Board is on the calendar length. How many weeks would you want to truncate by in an ideal world? Are you in a collision course with Australia in January?

ETIENNE de VILLIERS: In an ideal world -- the answer is it looks unlikely in the short term we'll be able to truncate it at all. The reasons being threefold: One is that we've got huge potential untapped and we need to supply in Southeast Asia we need to supply Southeast Asia with more programing.

Second reason, we have a very strong, very vibrant indoor tournament structure in the fall all over the world: St. Petersburg, Moscow, Basel, Stockholm, Vienna. They are great traditional tournaments. Ultimately, I'd like in 2009 or 2010, to bring the Masters Cup back to Europe, so it would make sense to have that.

Then finally, you've got to squeeze Davis Cup in, as well. You only got eight weeks. The current system requires a week between the end of the US Open and the Davis Cup. So we really, in effect, have only got six weeks, and to try and take a week out of that is just not doing justice to the sport. It's not doing justice to the players. That's why I said I think the way to resolve the issue for player health -- and I had this discussion with players yesterday and the day before -- is that we find other means. We separate back-to-back tournaments. We eliminate five-set finals. We start with 56 draws. We mandate less major events for them so that they've got better and more control over their schedule. I think that's as much going to help cure the problem and get ahead of it with medical insight, research, and technology.

And the Australian, Steve Word and I, had a chance at this. He's looking at options. I don't think he needs or necessarily wants to change in the short term. It's not a problem for us the way it is. It starts -- the advantage of it being where it is, it starts the season off with a bang. It's a great way to start a season.

The disadvantage is you don't get much of a run length. It's a disadvantage for him. You don't get much of a run length to build, and awareness. You don't get the road to Australian Open the way you can do with Arlen's tournament, which I just think is fantastic.

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