Buenos Aires — The star of world tennis, Carlos Alcaraz, has accumulated more than US$27 million in prizes during his short career, and now the 20-year-old Spaniard is aiming to add another US$800,000 at the Argentina Open 2024. It’s prize-money that the current champion and favorite at this ATP 250 tournament, who advanced last night to the quarterfinals, will not scough at, considering the US$1.26 million that the Miami Masters gave out in 2023, for example.
But to keep attracting stars like Alcaraz, the only top-10 player in the world ranking to take part in the Argentina Open this year, Tennium, the company that runs the tournament, is aiming to upgrade it to ATP 500 status.
The company has invested some US$1.25 million in infrastructure at the Buenos Aires Lawn Tennis Club, where the event is hosted, bringing the Argentina Open closer to that new category, Tennium’s CEO told Bloomberg Línea.
“It’s what we want and it’s a conversation that is permanently going on. The ATP is here this year and has noted the tremendous changes and the investment that was made,” said the Uruguayan and also president of the Uruguayan Tennis Association.
The following conversation was edited for length and clarity.
How much have you invested in the tournament since you took over in 2017?
Martin Hughes: The tournament each year costs about US$3 million. For seven years, that’s US$21 million. To keep improving infrastructure, this year we invested US$1 million, last year US$100,000, and in 2022 we invested US$150,000.
How has the profitability of the tournament evolved since you took it over? Has it had ups and downs?
Like any business it has ups and downs. We have been making it grow, in terms of the brands that support us, in terms of tickets, and we have been growing in the hospitality area, from the sales point of view. It is also true that we have been upping our investment in the tournament, because this is the second year, for example, that Carlos Alcaraz has come to play. It is a tremendous investment for this tournament. Did we sell more? Yes, we sold much more, but the truth is that we also spent much more. Alcaraz confirmed his presence on January 15. The chances of selling more brands or more things between January 15 and February 10 were nil. But it is a tournament that has been growing, whichever way you look at it. In audience numbers, in television viewership, in ticket sales, in turnover, in everything. We have been building and modernizing it, as was our plan.
Was there an improvement in profitability this year compared to 2023?
I don’t know yet, because we have four days of tickets left that can make the difference for one side or the other, of ticket sales. It is an answer that is almost impossible to anticipate. Last year when we did this tournament the dollar was at ARS$240 and today the dollar is at ARS$1,100. So, maybe in pesos, yes, and maybe in dollars, no.
Ticket prices rose sharply this year when measured in dollars. Was that for any particular reason?
Yes, because we invested in this tournament in dollars. The prizes are paid in dollars. We pay US$800,000 in prizes and I have to pay in dollars. So that’s one thing. And then we invest over a million dollars in players to make the tournament a good one, and those players are also paid in dollars. They don’t care if it’s blue, official, Coldplay [dollar exchange rates in Argentina] or whatever, they want dollars. So, if you have assumed those commitments in dollars, how do I fulfill those commitments? In the end, the only thing I sell here are tickets, and well, I have to raise the price of the tickets, to share the pain. Profit was hit in dollar terms, but I also have to try to tell the consumer, look, what you come to see I am going to have to pay for that in dollars. The option was, either we start selling tickets in dollars, and then we are all at ease... but that’s not possible in Argentina.
And how do you explain Alcaraz’s presence for a second consecutive year, considering that this is a tournament that hasn’t had so many top-10 players in the last 10 years?
I don’t agree with the top-10 players part, because top-10 players have come. Maybe no top-5 players have come. But well, Alcaraz is a clay court player, he’s young. In his annual plan he includes the participation in a reduced number of ATP 250s and among those that are attractive for his calendar, Buenos Aires is there. After here he also plays in Rio de Janeiro, where he has a contract to fulfill, and it is close to him. And third, because there’s also a business deal between him and us, too. He knows the passion with which tennis is experienced here, which is very similar to what he sees in Spain, how tennis is lived there, and he feels comfortable in the city. The tournament treated him well enough to be able to come back, so it is a series of things that happened.
Yesterday he was seen smiling at La Bombonera, do you think he will be back next year?
We will have to ask that question later, but he includes in his calendar some ATP 250s, and, so far, everything indicates that this is one of the ones he chooses. He feels very comfortable, he is very happy in Argentina, he likes the public, he likes the court, the stadium, the weather, the food, and we are going to make every possible effort.
You put a lot of effort into requesting an upgrade to become an ATP 500 tournament. Why didn’t it happen, and what is needed to get there eventually?
The ATP’s priority in this case was to clean up the annual calendar. They want to reduce the amount of tournaments they have in the northern hemisphere summer. So they prioritized any company that would merge two tournaments. If we would have had two ATP 250s to put together and eliminate one, we would have been very well positioned. And that’s kind of what happened, Dallas got together with Atlanta, Doha got together with Newport, and deals had to be made very, very quickly. There were purchases and sales of tournaments and licenses that were approved very quickly. The economic muscle of the Arab world also showed up, which is very strong, and that made us lose some competitiveness. Because if you are going to measure the result of the tournament by profitability, and they give you an unlimited check, you buy any tournament and you make it to ATP 500, in the end.
You have just renewed the contract in Buenos Aires for 10 years. Do you see this upgrade as feasible in the next 10 years?
Yes, yes, that is what we want and it is a permanent conversation. We see that the ATP has come this year and noted the tremendous changes and the investment that we made. It was part of their concern, that due to the difficulties faced by the club (Buenos Aires Lawn Tennis Club), if we were ready to organize an ATP 500 or not. They came back and said: “The truth is this is night and day”. We told them yes, we were halfway to making the changes to become an ATP 500, but we are not. So, they are very happy. On the feasibility, yes. It’s out of our hands, but it seems to me that yes, my hunch is that sooner or later this is going to happen. We thought it was going to happen last year, honestly I was very convinced.
How do you see the prospects for the business going forward, with this new climate of deregulation, getting out of exchange controls, etc.?
Super positive. We have always been positive and the tournament is a tree that is very well planted here. I travel and I don’t see audiences like the Argentinean one, nor the talent there is in Argentina. It is impressive how everything works in this country, yes, there are years when you earn a little less, it is not easy to withdraw the capital, all that kind of things. We have always had dialogue with the governments [of the Nation and Municipal] so that they support us. Obviously this is not the year for them to support us [the National government]. They could not support us, but that’s OK. Next year when they can support the tournament, they will do it. We believe the market will grow. The Title Sponsor, IEB+ (Invertir en Bolsa), was crucial this year. We had not had it for six years and it appeared last year. So, in the midst of the Argentine crisis, we got a Title Sponsor that finds the value of being at the tournament. And going forward we have to continue modernizing it, providing more entertainment to the public, which will be my focus for the years to come. Alcaraz sets the bar very high, but in the end it is not the only way to have good tennis here. There are other people too. We are optimistic for the future. You always need a little support from the country, which this year we couldn’t use, but we understand that.
What is your reading of the sponsors’ budget this year, compared to last year? More limited?
The same. Perfect. That has not fallen. Again, the negotiation was a mess because you agreed on a dollar amount, but then the dollar changed and you had to renegotiate everything, but we have a greater number of brands that wanted to be with us, because the tournament is operating at a different level. All the brands are really interested now. They understand the benefit, the different brand recall, the loyalty with customers they can invite, the entertainment we are giving. There came a time when we had to start saying no. No one asked to pay less because they were in crisis. None of us asked to pay less because we were in crisis. And I did not ask for less, because the tournament budget did not go down, it went up.
The National Government suspended the injection, but the Government of the City of Buenos Aires did not, is that correct?
That is correct. Yes, that is correct. The truth is that the City’s contribution is a very small amount, but it supports us in another way, it gives us spaces, gets us permits, people for transportation. They support us in other ways.
