Green Achers

It is post-harvest time at Silverado Resort in the wine country, where the separate pleasures of grapes and golf compete for equal time.

At the Transamerica tournament, in the sunny players’ dining area on the patio, the lunch choices for the Senior PGA Tour pros are grilled chicken breasts, burgers and individually prepared plates of steaming pasta. The mood is light and so is the cream sauce.

In the clubhouse parking lot, the courtesy cars are all lined up, rows of silver Cadillacs. Out on the driving range, the only sounds you hear are the resounding thwacks of metal clubs striking golf balls and birds chirping in that row of trees over on the left.

Someone should send for Norman Rockwell to get this thing down on canvas right away, because chances are, there are some changes coming.

Bruce Fleisher and Allen Doyle are the top two money winners on the senior tour with nearly $5 million between them, which means they should be two of the happiest men in silver Cadillacs. And they are, but that doesn’t mean they have their heads stuck in a bunker.

What’s going on with the Senior PGA Tour is, well, “possibly a low period, but I think we’re healthy,” Fleisher says.

Doyle says the tour is driven by a combination of competition and nostalgia but adds, “If the [television] ratings are down, whatever is driving us isn’t doing a very good job.”

*

In fact, it’s starting to look as if the senior tour is doing some off-roading these days.

And it’s not just the senior tour that’s hooking the ball. The PGA Tour and the LPGA Tour are experiencing some of the same problems that have presented a new, unexpected set of problems to the world of professional golf that is spinning like never before.

One of the changes is going to be right here at this tournament. For next year, there isn’t a title sponsor because Transamerica is pulling out. This is not news anymore, because in pro golf, losing a sponsor is no longer an isolated occurrence.

That is the troubling story line in golf--sponsors are disappearing, tournaments are going away and television ratings (at least on the senior tour) are so tiny they are nearly invisible.

John Gill, the director of special events for Nissan, the title sponsor of the PGA Tour’s Nissan Open in Los Angeles, says he’s not surprised that title sponsors are dropping by the wayside.

“I’ve had this concern for a long time,” Gill said. “The tour is always trying to raise purses. The tour tends to be a bit greedy as it relates to sponsorships and purses.

“The price of poker has gone too high.... You’re going to have some major tournaments looking for sponsors.

“And now they’re asking for a 30%-40% increase [in title sponsor fees]. Well, you couldn’t do that in a healthy economy, certainly not this one.”

Although the story line involves the standard golf issue, money, this one has several unusual twists. And that’s not even getting into the debate about whether the senior tour has more interest as a nostalgia tour featuring familiar players or whether it’s all about competition and who wins what.

The senior tour is in the first year of a four-year, $12-million deal with CNBC, the cable network available in 81 million U.S. households. Apparently, however, only a few of them are tuning in the Senior PGA Tour.

The average rating on CNBC for senior golf is .26, which many consider surprising, since nobody realized before that ratings could be measured that low. It is a disastrous level, indicating near total apathy for the tape-delayed telecasts.

Last month at La Costa, Fox taped something called the NFL Celebrity Golf Shootout, an event that featured celebrities such as Samuel L. Jackson, Meat Loaf, Tom Arnold, Richard Roundtree and Chris Noth, plus pro football players such as Jason Sehorn and Michael Strahan. The rating? A 1.7.

Gary Player said that although CNBC may deliver the proper demographic to senior golf, it’s being delivered at the wrong time.

“Tape delay is troublesome in these modern times, with the Internet and so forth, when you know the results beforehand,” he said. “The senior tour has a great message and these great players are examples to everyone. We need to do something to make sure that message is relayed to the greatest number of people in the best manner possible.”

Fleisher said the senior tour is considering tweaking the telecasts by miking the players and dropping the gallery ropes behind the last group.

Television ratings aren’t as big a problem for the LPGA, only a slightly different one.

The LPGA has enjoyed higher ratings this year, up more than 20% over last year’s numbers, but the tour does not have a television deal and sponsors must pay the networks to get the tournaments on TV.

Even so, Ty Votaw, the LPGA commissioner, says that weekend ratings on ESPN for the tour’s 12-tournament State Farm Series are up 42% from a year ago.

“We have a snapshot of where we are and were we want to be,” Votaw said. “Our strategic planning is paying off.”

The LPGA is not making headlines with its ratings but it is holding its own against similar competition. Just don’t compare it to the PGA Tour.

For instance, the fourth round of the first men’s major of the year, the Masters, had a 13.3 rating on CBS. The fourth round of the first LPGA major of the year, the Nabisco Dinah Shore, had a 1.1 on ABC. That, however, tied another women’s sport. The final regular-season rating for the WNBA on NBC also was 1.1.

Still, there could be as many as eight LPGA events without title sponsors in 2002, such heavyweights as Anheuser-Busch for the St. Louis event and Subaru in Naples, Fla., pulling out.

It’s the marketplace, says Votaw, who pointed out that, for once, the LPGA isn’t alone on the title sponsor merry-go-round.

Votaw expects to maintain close to this year’s level of $41 million in prize money, even though he wants to see fewer official money events next year, 32, down from 38. . In 1999, there were 43 official money tournaments.

The Senior PGA Tour is playing 37 official money events in 2002, one fewer than this year, but if contraction isn’t a problem, holding on to some of its title sponsors clearly is.

The Las Vegas stop wasn’t played this year. Home Depot said it’s getting out after five years as title sponsor in Charlotte, N.C. The LiquidGolf.com that was scheduled last month in Alpharetta, Ga., was an Internet casualty and never got off the ground, becoming the SAS Championship in Raleigh, N.C., instead.

The Vantage in Clemmons, N.C., was canceled because of the terrorist attacks, which only meant that sponsor R.J. Reynolds Tobacco Co. delayed pulling the plug on its involvement until after next year’s event. Player contends that the real key to the long-term future of the senior tour is for the top players to play more often. Tom Kite has missed 13 weeks. Tom Watson has played in only 12 events, Lee Trevino in 17, Raymond Floyd in 12 and Jack Nicklaus in seven.

“Yes, the economy dictates that it’s tough out there, so we have to make even more of a concerted effort,” he said. “If we did lose a few tournaments, so be it.”

Then there is the PGA Tour, the undisputed leader of professional golf. Only two months ago, the PGA Tour agreed to a new, four-year television contract worth an estimated $850 million, an increase of about 25% over the current deal, estimated at $650 million, which runs through 2002.

Flush with what appeared to be an overflowing revenue stream, the PGA Tour began an aggressive campaign to make even more money available to its playing members, increasing the fees it charges tournament title sponsors starting when the new television contract begins in 2003.

“Tim [Finchem] was so lucky, so lucky, to get that deal done before the economy went sour,” Gill said.

A typical PGA Tour event that costs sponsors $4-4.5 million a year will be bumped to as much as $6 million under the new arrangement.

It’s simply too much, Gill said.

“It is what it is, but that doesn’t make it right in the real world,” he said.

“Now, for us, Los Angeles is a strong market. But what do you do in Reno? They don’t have a sponsor and it’s not really a strong golf market. I hear Shell is taking a close look at its Houston event.

“People like Honda and Toyota are supposed to be right there and interested in stepping in as title sponsors, but if people keep dropping because the purses are going up, we’ll see how interested they are,” he said.

Part of the problem, Gill said, is that some title sponsors came in for the short haul, raised purses, artificially created a higher market for purses and title sponsorships, then either disappeared or made little impact.

“It’s like, ‘OK, I want to become involved in a tournament.’ The tour says, ‘OK, this one has a $5-million purse.’ But wait a minute, wasn’t it $3 million a year ago?

“Take [the Invensys Classic] Las Vegas. It’s on a TPC course and, what, 31 under par wins? It’s got five rounds and a pro-am and the only way it gets players is because it has a $4.5-million purse. But what is Invensys? Who are they? What do they do? Are they in it for the long haul?”

Invensys is in the automation and controls business, producing control systems for automatic industrial plants, and electronic devices and controls for homes and offices. It also makes power systems to protect telecommunications and information technology networks.

Even before the economy went sour and before the tragic events of Sept. 11, repercussions from sponsors were being felt.

In Phoenix, Xerox turned down its two-year option as presenting sponsor of the Phoenix Open in 2003 and ‘04, which couldn’t have come at a worse time for the promoters, who have had four presenting sponsors since 1990 and were already looking for a title sponsor willing to ante up as much as $24 million for four years.

Advil told the Western Golf Assn. it is ending its three-year run as title sponsor of the Western Open after 2002. Canon at Hartford and Air Canada at Vancouver are also stepping aside as tournament title sponsors after 2002.

Genuity, which stepped in this March to replace Ryder as the title sponsor in Miami, is undecided about going on when its two-year deal ends after 2002.

Said Gill, “There are some folks out there who are not happy with what they’ve got.”

John Von Stade is the managing director of Millsport Golf, a company that puts together sponsorships. Higher sponsorship fees spell trouble, Von Stade said recently.

“It comes to a question of whether a company can justify these types of increases,” he said.

All the news is not bad, however. Valero Energy Corp. of San Antonio signed a five-year, $15.3-million deal to become the main sponsor of the Texas Open, a move that allowed the 79-year-old event to be held two weeks ago.

The Nissan Open at Riviera Country Club has been played under one name or another since 1926. It’s going to go on for at least five more years, according to tournament director Tom Pulchinski, who said Nissan has agreed to a new deal to remain as title sponsor through 2006. The agreement has not yet been signed but will be soon, Pulchinski said.

The Nissan Open is one of the fortunate events, with its title sponsor in line for years to come, he added.

“A lot of title sponsors are starting to feel the pinch of the economy. There is a fear.”

The Nissan Open lost one of its associate sponsors, Northwest Airlines, after 15 years, and is trying to find a replacement. But Pulchinski understands the decision.

“They laid off 12,000 employees and cut flights and then they lay out money for sports? It’s hard to justify corporate involvement at that level.”

Title sponsors feeling the pinch will probably seek out presenting sponsors to bring in added revenue. Depending on the market, a presenting sponsor would commit from $250,000 to as much as $900,000 to a tournament. The title sponsorship involvement is played out on an even grander stage.

“With the [sponsorship] dollars going up to that $6-million or maybe even $8-million level, these companies are deciding it would be wise to take a pass,” Pulchinski said. “It’s the economy. There’s no big debate that the economy is driving this and if everything was going great, the money flowing, we wouldn’t be having this discussion. That is not the case.”

The cost of doing business with the PGA Tour is soon to go up. The tour sent out its new money requirements for title sponsors for 2003. No one has commented publicly yet on the specific numbers but Gill put the figure at a 30%-40% increase.

“I don’t want to be driven out of golf, but I sure can’t afford a 30%-40% increase every year,” he said.

The Nissan Open can handle the raise in fees, said Pulchinski, who added that he expects the tour to be flexible on the price increase because the economy has worsened since the new television deal was struck. That may be possible, said Henry Hughes, the PGA Tour’s senior vice president and chief of operations.

“Like any other business negotiation, it’s negotiable,” Hughes said. “There are certain things that are set costs, but we’d be foolish not to take into consideration the economic times. Things are not the best right now, so that could be a factor. But what we would be talking about would not be a great change in the dollars.”

Next month at Maui, the PGA Tour will discuss the new increases with the title sponsors at the yearly sponsors’ meeting.

“I’m sure it will be a very spirited discussion,” Gill said. “Usually, it’s, ‘Yeah, yeah, yeah,’ then you hurry up to make your tee time.”

The dollars, they are a-changin’, all right. It’s the hot button in pro golf and it’s getting mashed pretty hard right now.

*

In the meantime, all is quiet at Silverado, where the picnic goes on, the white tablecloths are starched, the silverware gleams and the only thing that’s mashed is the potatoes.

Big money and big-time golf, it’s always been hard to separate them, and these days it seems downright impossible.

And you thought golf was all about putting a round ball into a round hole? These days, that’s the easy part.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

HIGH PRICE OF HOSTING

The growth of the annual purse total in the last five and 10 years:

PGA

1991: $49,628,203

1996: $69,100,000

2001: $184,725,320

*

SENIOR PGA

1991: $19,788,218

1996: $37,800,000

2001: $59,000,000

*

LPGA

1991: $18,435,000

1996: $26,500,000

2001: $38,500,000

Sources: PGA, Senior PGA, LPGA