You won’t believe how much prize money is on offer at the Tennis.

At the Australian Open, first round losers take home enough money to buy three (3) of the automobiles on offer from major sponsors Kia. They can stand on an outside court, not even touch a ball with their racquet, and still take home $34,500.

Even those who fail to qualify for the tournament itself are richly rewarded. 64 men and boys and 48 women and girls have their dreams crushed in the first round of qualifying each year. To compensate them, they get $4000 in prizes. Losing in the second round of qualifying garners you $8000 and losing in the third round nets $16,000. Not bad.

Since I found out the total prize pool at the Australian Open, I’ve been asking people to guess it. Guesses have ranged from $4 million to $12 million. None have come near the true total: $40 million.

The organisers give out prizes left and right. Every player gets something. The Aussie Nick Kygrios takes home $340,000 for making it to the quarterfinals of the men’s singles draw. But he also gets $7400 as his share of a team that lost in the first round of the doubles. (Nick is ranked 1207th in the world for doubles, suggesting that entering the doubles draw might have been about the cash, not his passion for the game.)

The prizes in the singles are greatest.

Screen Shot 2015-01-29 at 2.52.11 pm
Winners’ loot.

The most expensive match of the tournament is the final, of course where the loser gets $1.55 million and the winner $3.1 million. But it is also the only round where the winner collects a cheque. In each other round the winner goes on to a chance of bigger and better things. Excluding the final, the most expensive round for organisers, at $2.1 million, is round one, where 64 losers get $34,000.Screen Shot 2015-01-29 at 2.39.37 pm

The prizes are rich enough to cover airfares and accommodation – even for the players who lose at qualifying. Research suggests 150 pros are making enough money to break even in each of the men’s and women’s game. At the same time, some up and comers are probably losing money now in the hope of gaining the experience to make it big later, and others are losing money in the twilights of their career, hanging on in hope of one more glory. (Hi Mr Hewitt!).

So, where is that money coming from?

Tennis Australia’s Annual Report shows it made $193 million last year from “events and operations.” While there’s not much detail, one can imagine that the vast bulk of that is broadcast rights to that highly rare prize, the Australian Open. Channel Seven in Australia pays $20 million a year.  The rights globally are doubtless severalfold higher.

Having a grand slam is quite a feat for a country of Australia’s tennis stature. Government supports it, but the support is less direct and therefore less controversial than that provided to the Grand Prix. They prop up the Melbourne and Olympic Park trusts which run the stadiums and have put in hundreds of millions of dollars for their development and re-building. Those stadiums are used for other purposes too, many of which attract tourists from around the world, contributing to the local economy.

Happily, Australia’s tax treaties mean athletes are liable for tax in the country where tournaments take place. So Djokovic, the Williams, et al, all face up to the ATO and hand over a chunk.

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thomasthethinkengine

Thomas the Think Engine is the blog of a trained economist. It comes to you from Melbourne Australia.

4 thoughts on “You won’t believe how much prize money is on offer at the Tennis.”

  1. By simply considering the 750,000 visitors during the fortnight and applying the minimal entry fees at about $30 that’s good revenue already (22.5M). The real amount is significantly more than that with Margaret Court and RLA special tickets. So maybe not to far from breaking even between tickets sales and prize money.

    Tennis is thus a good image of the world where the 1% earns most of the wealth.

    It is indeed a struggle when you are not automatically part of the grand slams draws, money is scarce and costs are high money-wise and time-wise. Once you’re in, it is still not a virtuous circle, because you’ll play against Rafa or Roger at the first round. The seeding system is against free competition. I don’t know any other sport as unfair, even golf is fairer with handicap.

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  2. Stupidest shit I have ever read. What about being top 100 to play grand slam and years of hard work to become top100 player. What about taxes, coaches, doctors, fitness coach ect. Do not write shit about what you have no idea.

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    1. I encourage you to have a quick look around the rest of the internet. If you cannot find something stupider than this i will, I don’t know, write a poem in your honour.

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  3. You are talking about the cream of the sport. Yes if you qualify for a grand slam you are still a top player as only 64 qualify for a men’s or women’s draw. How many CEOs are there in the world who earn millions a year. I bet there are more than 64 billionaires in the world the US alone have more than 500 actually. These people are just like singers and actors and artists who are popular and earn their income by their virtuosity. It’s easier to be a billionaire than a Roger Federer or a Serena Williams actually.

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