All players enter a tournament for the same amount of money, called the buy-in. In addition, the poker room or casino charges an entry fee to all players entering the tournament.
If the buy-in is $100 the house might take an extra $10, which means that the actual amount paid by the player is $110. If there are 100 players, the total prize pool will be 100 x $100 = $10,000. The payout structure depends on the tournament, but usually there is a prize for approximately every 10 players. In this case, it might be 30% for first place, followed by 20%, 13%, 10%, 7%, 6%, 5%, 4%, 3%, and 2% respectively, thus making for 10 prizes in total.
All players start out with an equal amount of chips and, as the tournament progresses, the stakes are typically raised every 15-60 minutes. The number of chips players begin with, the stakes and the time periods determine whether it is a fast or slow T.J. Cloutier has finished second twice and made several final tables.
Again, in order to win a tournament you have to get lucky, but to place in the money (and occasionally finish in first place) on a regular basis you must be a skilled player.