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* '''System test phase''' - Each problem that survives through the challenge phase is run on many diverse test cases. Coders are awarded points for problems that pass all test cases, based on the speed and difficulty of problems solved. At the end of the contest, ratings are updated to incorporate each participating coder's performance.
TopCoder usedinitially to give outawarded money every week to [[coders]] who did well in the weekly competitions, or Single Round Matches (SRMs), in a business model that seemed paradoxically brilliant. SRMs are now sponsored by outside companies such as [[Google]] and [[Yahoo!]], and prize money is notonly awarded except for twice a year to winners and finalists of the TopCoder Collegiate Challenge (TCC, which is in the spring) and the TopCoder Open (formerly the Invitational, which is in the fall).
The [[business plan]] behind [http://www.topcoder.com topcoder.com] is actuallycomprises ratherseveral interestingobjectives. One goal is to be a sort of recruitment center where companies can come and find programmers who are proven to be highly skilled. Another aim is to be an [[outsourcing]] center:. TopCoder also hosts design and development competitions in which coders can compete to solvecreate real[[component]]s worldand problems[[application]]s that third parties have contracted for.
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In the early days, the ''Iron Man'' system was set up under which coders were grouped into rooms of ten according to skill level (determined by [http://www.topcoder.com/index?t=support&c=ratings rating]), in order to encourage newcomers (who would have little hope of beating out the best coders for prizemoneyprize money) to stick aroundstay and compete. After the contest, the top (3?) (highest scoring) coders in each room were paid according to the skill level of the room (winners in the room of contestants with the top 10 ratings were paid more than those in the room with coders 11-20, and so on). This created some paradoxical situations such as the possibility of coming fourth in the whole contest and getting no money, while the 111th placed contestant got paid, and gave rise to ''ratings diving''. Ratings diving, or taking a ''ratings dive'' was accomplished simply by doing very poorly on purpose in a particular contest (by opening and not submitting any problems or submitting incorrect challenges). As a result, a contestant would, in their next contest, be placed in a room with 9 coders among whom they had a good chance of winning some money. The idea was that the dramatically increased chance of winning money made up for the fact that the money to be won was a lesser amount given the lower average rating of the room.
Since, codersCoders have since been divided into two divisions (appropriately named Division I and Division II), and are grouped in rooms of up to 20 in such a way that within each division, the average coder ratings in each of the rooms are roughly equal.
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