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Tennis officials cautiously optimistic about fallout from financial crisis

PLAYERS may be trimming their spending on designer gear and watching with chagrin as their investments sag, but officials say tennis has largely been insulated from the global financial crisis.

The sport's efforts to expand around the world have paid off with diversification that other sports can only envy. Although financial services companies and automakers -- among tennis' prime sponsors -- have been hit hard, replacements have been surprisingly easy to find.

"Despite the current economic shape, the ATP World Tour remains in good commercial shape -- and while there is absolutely no such thing as recession-proof, we remain cautiously optimistic about the future," said Kris Dent, the ATP's corporate communications director.

He said revenues, attendance and prize money all grew last year.

"We are almost unique as a sport in terms of our global reach -- this season we will have 63 tournaments in 32 countries -- which means regional economic difficulties do not affect us in the way they might national associations or leagues," Dent said by e-mail.

It doesn't hurt that tennis has some of world's most easily identifiable and popular individual athletes -- think Roger Federer, Rafael Nadal, Maria Sharapova and the Williams sisters.

Some of them say they're cutting back on their spending: Serena Williams, a fashionista who has a penchant for shopping sprees and bling, was sporting a handbag that she said cost about US$12 when she held a media conference before the Australian Open starts tomorrow.

Most players on the tour have financial advisers who are working hard to limit the impact of the crisis on their clients. Federer has said he is lucky that several of his sponsorships are virtually lifetime deals.

Still, tennis has hit some bumps in the road.

The US Davis Cup team lost its main sponsor, troubled insurance giant AIG, after nearly a decade. Mercedes-Benz announced in 2007 that it was ending its backing of the ATP at the end of last year to focus on golf, equestrian and soccer, as well as fashion and lifestyle.

The timing of the end of the relationship with Mercedes-Benz was bad, but far from devastating.

"In the last few months we have seen a large number of existing sponsors renew three-year contracts with the ATP -- companies such as Enel, Ricoh and South African Airways -- all deals at or around US$20 million," Dent said.

Barclays has jumped on board with a new five-year, US$38 million sponsorship of the ATP World Tour Finals, which are being moved to London from Shanghai this year, and talks are in an "advanced stage" with possible replacements for Mercedes-Benz, Dent said.

"We are in a fortunate position that as a business we can afford to take the time required to get the right kind of deal for the ATP, and while clearly the current financial climate is an added challenge, we remain in good financial shape as a sport and are very confident of finding the right kind of partner for the ATP at the right price for the ATP," he said.

The ATP surveyed its tournaments in late November on how the global crisis has affected them and found most in good shape.

"Of the 63 tournaments, 48 had title sponsor deals, with the remainder having supporting sponsor deals in place," Dent said. "Only six tournaments had not yet confirmed their major sponsorship deal for 2009; since then, two have signed their deals for 2009 and the remaining four are very close to doing so."

And demand remains high for tournaments. Hamburg lost its event, but the Masters-level tournament was snapped up by Shanghai. The rights to the Dutch Open have been acquired by third-ranked Novak Djokovic's family and will be moved to Serbia.

The German Open was dropped last week from the 2009 women's tennis calendar after the tournament's owners sold the sanctioning rights to the WTA Tour.

The tournament had been owned by the Qatari Tennis Federation, which decided it no longer wanted to operate an event in Berlin. No other promoter stepped forward to buy the rights to run the tournament; the tour purchased those rights but does not run events.

Officials at the Australian Open, the year's first Grand Slam, say it's business as usual, with ticket sales on track with 2008. Major sponsors signed new deals last year, and the tournament has added Lacoste to its backers.

Things are going well enough that organizers announced a week ago that overall prize money was being increased by 12.3 percent to US$16.34 million, with all the extra cash going to the singles finalists, although one reason cited was the Australian dollar's slide in international exchange rates.


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