The European Tour’s Global Impact

The European Tour recently announced a deal with Dubai-based Leisurecorp in the order of nearly a quarter of a billion dollars. The deal secures a Dubai office of the European Tour. It also secures a tournament, course, and real estate development co-venture between the two organizations. Most important to the deal, though, is the commitment by Leisurecorp (the government of Dubai, really) of millions of dollars to funding European Tour event prize pools.

The most prominent part of that tournament funding comes in the package now known as the Race to Dubai. Beginning in the 2009 season, the European Tour schedule will run from January through November — like the PGA Tour. The events held under that schedule will, in essence, be turned into a FedEx Cup-styled money race that will determine the top 60 golfers on the European Tour. Total money earned in those events will be tracked on the Race to Dubai list — formerly the prestigious Order of Merit. The top 60 money winners that are qualified European Tour cardholders will then move on to the season ending Dubai World Championship.

The Dubai World Championship, played in November each year, will be the richest tournament in professional golf history. It will have a prize pool of $10 million and reach the plateau that Jack Vickers (of the PGA Tour's former the International event) could not establish here in the States. The limited field of 60 will compete for their share of $10 million in that event.

Also, the final Race to Dubai/Money List standings after the Dubai World Championship will be used as the basis for distributing another $10 million bonus pool to the players qualifying. All told, the effective prize pool for the Dubai World Championship becomes $20 million. And it creates the possibility of a player having a final putt on the 72nd hole of the event for over $3.5 million — depending on the exchange rate.

These are incredible numbers that have never been seen in golf for a single tournament. The question about this development, though, is what kind of impact it will have on the golf world. This piece seeks to address the global implications of the new Race to Dubai.

The Point of the Race to Dubai

This was a move made by the European Tour in an attempt to counter what the PGA Tour had done in 2007 with the formation of the FedEx Cup. The FedEx Cup has a $28 million, four tournament playoff series that culminates in a $35 million bonus pool payout, with $10 million of that going to the ultimate winner of the season-long race. The grand total of $63 million related particularly to the FedEx Cup greatly outweighs the $20 million made available from the Race to Dubai playoff and bonus pool.

It is clear that the European Tour simply does not have the financial resources or global sporting clout that the PGA Tour does in the United States. The European Tour also knows this and realizes it is at a disadvantage. The Euro Tour is years away from being able to compete with the PGA Tour on a head-to-head basis, if ever.

The point of the Race to Dubai is to set the stage for the emergence of the European Tour as an equal to the PGA Tour. Dating back into the 1960s, prominent European players have been leaving their home nations to come to the United States and play on the PGA Tour because of its promise of larger purses, greater competition, and tour stability.

The European Tour simply could not offer that to its players because of its nascent state — emerging just 36 years ago. In fact, the European Tour did not even have its first corporate sponsor, Volvo, until 1988. The development of the European Tour lagged behind the PGA Tour.

Tens of players born in Europe or that made the European Tour a stepping stone on their path to the PGA Tour have made the United States the place where they play the most golf. It made good sense to do that because the PGA Tour conveniently offers many of the most prestigious non-major events on its schedule with huge purses compared to the rest of the world. Even without the potential for appearance fees, players that performed to even a mediocre standard could make a very nice living. Three of the four major championships are held in the United States. Also, the climate in the southern half of the United States is much more conducive to a year-round, world-class professional than most of Europe.

All of those positives have been difficult for the European Tour to combat in its efforts to lure back the players that first made the Euro Tour home. In recent years, there have been a few benefits that were starting to stem the tide.

The most prominent was the development of the multi-year schedule. Like it or not, the fact that the European Tour never stopped touring actually helped the circuit tremendously. It allowed the European Tour to go outside of Europe proper and develop events in Asia and the Middle East — regions that have been clamoring to get into the professional golf spotlight.

A second factor in making those new events successful was the drive of those regions to make golf events prominent immediately. In the world of huge purses in which the events were born into, tournament organizers quickly gathered respectable prize pools using international corporate sponsorship.

Still, that was not enough, so the sponsors then compiled large sums of money that could be devoted to luring in top global players with appearance fees for playing in these "offseason" events. The HSBC Champions event — China's major — is a shining example of this phenomenon. Even Phil Mickelson, notorious for shutting down his season after the U.S. PGA Championship, has been lured by the wheelbarrow full of money awaiting his arrival in China for the HSBC event. While the bribery method may not be the most appealing and has had negative impacts on longer standing events in Australasia, the tactic has worked to get the world's best to venture outside of the United States after the PGA Tour season has ended.

Lastly, a grassroots wave of European nationalism in golf has caused many European-born (or European-living, in the case of Ernie Els) players to return to the Euro Tour more often to support the tour that gave them their start. With increased prize pools, better player development among the 20-somethings of European golf, and better venues, the European Tour is not such a tough selling point now.

Impact on the PGA Tour

The intent of the Race to Dubai, then, is to provide a fourth and most significant benefit for dual cardholders of the European and U.S. PGA Tours in an effort to get them to play in Europe more often and increase the profile of the European Tour. Whether or not this move will actually provide that benefit is still subject to speculation as the 2009 European Tour schedule has not been released and the PGA Tour's answer to the Race to Dubai has not been made known. (Be rest assured, though, that it is coming and I have speculated about what it could be on my Golf News Net blog.)

With what is known, though, it is clear there will be some positives for the European Tour in this new deal. First, the finale of the European Tour season will after the PGA Tour Playoffs end in September. At that point, the PGA Tour will be hosting lame duck Fall Series events that generate little attention and poor fan interest here in the States, much less globally. The golf stage has essentially been cleared by the PGA Tour with the formalization of the Fall Series and the European Tour has said it will stage many of its more prestigious events during October and November as a lead to the Dubai World Championship. Even if the PGA Tour still out-shadows the Euro Tour on a week-to-week basis, the final few months of the global golf season will belong to the European Tour.

Though most of the PGA Tour's week to week events offer more world ranking points than their European Tour counterparts, that trend is starting to change. Several prominent tournaments in Europe like those in the Desert Swing through the Middle East offer significantly higher world ranking points than their PGA Tour counterparts. World ranking points are significant because they are increasingly used to determine exemptions for major tournaments and wealthy non-majors. Add in the incentive of an invitation to a $20 million tournament during the PGA Tour off season by playing in the minimum number of European Tour events to maintain qualification status and many PGA Tour players will suddenly be considering exhausting all three exemptions that they have to play on other tours.

Maintaining European Tour status by playing in 11 Euro Tour official events is fairly simple for the top players. Consider that all four majors and the three World Golf Championships events are co-sanctioned. Now top PGA Tour players simply have to use all three exemptions and participate in the Dubai World Championship to be considered European Tour members every year. It is almost too easy — and by design.

That may very well be enough to induce the top PGA Tour players to consider the European Tour more often. How about the best PGA Tour player, though? How about Tiger Woods? He currently is not a European Tour cardholder. Though he threatened privately to do so at multiple points in his career, he has never paid the minimal fee to become a Euro Tour member. The kicker with the Race to Dubai is that you must be a European Tour member to qualify for the Dubai World Championship. Tiger may very well accept his Euro Tour card now, though.

The Dubai connection may be too tempting for Woods to deny his Euro Tour card. Tiger Woods is developing his first course, Al Ruwaya, in Dubai. Woods has committed to playing in the Dubai Desert Classic for several years in a row. The European Tour strategically can use this relationship to almost force Woods to participate in the Dubai World Championship and, as a result, the European Tour. It might just be brilliant enough to work.

If Woods does participate and become a European Tour member, then that move will have the biggest impact on the PGA Tour. Woods playing as a dual member may very well force PGA commissioner Tim Finchem to lift the three exemption rule and allow for players to enter events on both tours seamlessly. In other words, Finchem would have to allow Woods to expand his Tiger Tour even further and, in the process, extend that right to everyone else.

Impact on Other Tours

This story is not all positive, though, for global professional golf. Through the announcement of the Race to Dubai, the European Tour has declared that it is seeking to establish its own name on the same level as the PGA Tour. They have also declared that they want to do this on their own accord and perhaps at the cost of severely damaging relationships with other global tours that have banded with the European Tour in the past.

Earlier this year, the European Tour announced events for the 2008 season in India and South Korea — new territory for the Tour. They did so, though, without consulting a long time partner in the Asian Tour about co-sanctioning and co-announcing the events. This drew a very strong, public, and negative reaction from the Asian Tour. After all, the two tours had worked together for several years to co-sanction events like the HSBC Champions that would benefit both developing tours. In recent weeks, though, the relationship pains have begun to mend with the likely announcement of co-sanctioning for the Qatar Masters and the new event in India, called the Indian Masters. Still, the signs of disregard from the European Tour on these two events appear to be part of a straining relationship with the Asian Tour.

The Australasian PGA Tour has also had a similar relationship with the European Tour in recent years. Two events during the Aussie season have been co-sanctioned by the European Tour — the Mastercard Australian Masters and the Michael Hill New Zealand Open (being played this week). The announcement of the Dubai World Championship and further schedule modifications has caused doubt about the future of that relationship, though. The Australian Masters would share a date with the Dubai World Championship, which would force the Aussie tradition into extinction. Thus, the Australian Masters will likely have to change its date to October if it seeks to remain on the European Tour schedule. That could cause peril for the Aussie golf season as other tournaments later in the year in Australia may not get a bump from co-sanctioning.

The likely outcome that is developing as a result of these two situations is the emergence of a merged Australasian, Asian, and Japan golf tours as competition to the European and PGA Tours. Throw in the possibility of engaging the Southern Africa (aka Sunshine) Tour, and that could very well be a formidable rival to the European Tour's efforts to expand well beyond Europe. In essence, the Race to Dubai could effectively kill any efforts to create a truly global tour.

Though the full impact of the Race to Dubai is not clear, it is beginning to take shape. The shape is enormous and may have impacts far greater than the European Tour ever intended — for better and for worse. In the end, it appears that the European Tour will become a greater competitor to the PGA Tour. As a result, though, they may also have spawned a new rival. Regardless of the shifting and merging and scheduling, it appears that the golf fan is likely to win.

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