Expanded Playoffs Discourage Greatness

To paraphrase the late, great Chris Wallace, if it ain’t one thing, it’s another freaking other. After MLB announced its bubble-esque postseason format, Rob Manfred slipped in the claim that expanded playoffs are likely here to stay.

Manfred, as he is wont to do, conflated what the owners — his bosses — desire with what has actually been decided; expanded playoffs would require an agreement between the league and the MLBPA. Even though Manfred’s declaration is merely media signaling, though, it’s worth discussing its potential effect on baseball’s competitive landscape, because it would be absolutely earth-shattering.

While the commissioner didn’t elaborate on what type of expanded playoffs he was talking about, it’s fair to assume that they might take the form of this year’s tournament — eight teams in each league qualify, with best-of-three series at the higher seeds’ home parks to cut the field in half — though they could also feature a 14-team field, a possibility reported by Joel Sherman in February. I’ll assume a 16-team field here, as I think the extra television revenue will prove awfully enticing. From there, there would be the normal five-seven-seven structure we’ve grown accustomed to.

In an abbreviated season, expanded playoffs make some sense. 60 games isn’t enough to separate the wheat from the chaff, so a postseason cutoff was always going to feel arbitrary. Sixteen, eight, 10 — none would feel normal, because this season isn’t normal. Given that, creating more of a tournament atmosphere via short series feels like a fun one-off plan.

If every possible 2020 playoff format is going to feel equally valid, the owners have an obvious reason to expand the postseason: money. Owners take in the vast majority of playoff revenue — players get a share of the gate receipts in the first three (in the case of the Division Series) or four (League Championship and World Series) games of each round, while the owners get the rest of the gate as well the television money, which overshadows revenue from ticket sales. More games means more games to sell to TV networks. Ask a group of businesspeople if they’d like some extra money at almost no cost, and well, they probably won’t say no.

But in a full baseball season, a 16-game playoff does something else entirely. One of the neat features of a 162-game season is that it does an excellent job of determining which teams are best. On a given day, anyone can beat anyone. In the broad sweep of time, however, five percent edges add up. That doesn’t mean the 10 best teams always make the playoffs, but it does mean that you can be fairly certain the top team in each league is better than the sixth-best team.

From there, the postseason is still a random event. The Astros and Dodgers had the two best records in baseball last year, and the Nationals outlasted both of them. The point of a cutoff, then, is to limit the postseason to good teams. Anyone can win once there, but the smallest playoff field (by number of teams) of the major North American sports, combined with the long season, mostly keeps the riff-raff out.

In a 16-team format, the Astros and Dodgers would still be top seeds. They’d be only three games away from elimination right from the start, however, just like the other 14 teams in the postseason. Everyone who’s watched midseason baseball knows that bad teams sometimes beat good teams in three-game series. That’s simply the cost of doing business in a random game.

To get an idea of what that would do to each team’s odds of winning the World Series, I did some approximating. I took the top eight teams in each league and mixed together winning percentages, mean reversion, and odds ratios to come up with some (very) rough World Series odds. Going into last year’s playoffs, that looked like this:

Then I did the same thing using the new playoff format: top eight teams, mean reversion, odds ratio — throw them all in a pot, and you get some World Series odds:

The new structure is flatter by far. Take a look at the odds changes by team:

Win your division? You’re hurt by the new format. Wild Card team? You have slightly better odds, because sometimes you’re lucky and the eight seed knocks off the one seed before you have to play them. Mediocre? Join the World Series party!

The main benefit of my loose approximation of World Series odds is that it generalizes well. I used the same method to run World Series odds under both scenarios for every team going back to 2012, the first year of the current playoff format. Here, for example, is 2018:

There are some seeding vagaries to handle. In 2015 and 2017, for example, both Wild Card teams came from the same division in the National League. The same was true in the AL in 2016. After accounting for that, however, here are the aggregate World Series odds for each finishing spot:

The “Division Winner” lines are self-explanatory. The Wild Card slots, on the other hand, require slightly more explanation. They refer to the top five teams, in record order, who didn’t win their divisions. In 2017, for example, the Rockies won 87 games and finished third in the NL West on their way to capturing the second Wild Card. They count as a “WC2” team here, even though in the new playoff format they’d be the seventh seed.

In a broad sense, the new format penalizes building a great team. The marginal gain from going from the 5-8 seed range — 82-85 wins — to the 3-5 range — 90-92 wins — is tiny. Those 7.5 wins are worth roughly 2% of a World Series trophy. Going from 90-92 wins to the top two seeds — 96-100 wins — adds roughly another 3% of that hunk of metal.

That’s a stark difference from the current format. The 82-85 win range is worth roughly 0% of a World Series championship right now. Move your team into the 90-92 win range, and you add a whopping 7% of a trophy. Go the extra mile and reach the 96-100 area, and that’s another 7.5%. Getting out of the muck is hugely valuable now. It will become less so in the new format.

There’s a countervailing effect that you can’t see here — going from 75 wins to 85 wins is now worth more. It’s worth asking, however, how much teams value a 5% chance of winning the whole shebang. Teams have a chance to do that most years with an aggressive offseason of spending or acquisitions, and they mostly don’t. The emphasis, instead, tends to be on either hunting for bargains or team control. That’s not to say that the occasional team doesn’t take a shot at it, but even then, they mostly attempt to do so in the context of a sustainable, low-cost team.

I’m veering into speculative territory here, but it seems likely to me that this would scuttle the free agency market in relatively short order. The value of mid-tier free agents has already collapsed. Star players have, thus far, avoided this fall, because they mostly don’t have clean substitutes. Teams have gotten increasingly good at developing cost-controlled 1-2 WAR players. Why sign an average free agent when you can make 95% of one out of bubble gum and a minimum contract?

You can’t do that with stars, and a team full of average players is by definition average. To push from the low 80s to the mid 90s, you need to either find a controllable star in the draft or international free agency, trade for one as a prospect, or pay up for one in free agency. Why do the likes of Anthony Rendon, Stephen Strasburg, and Mookie Betts command nine-figure contracts? Because teams interested in living at the top of the table need to jam 5 WAR into a single roster spot to achieve win totals in that stratosphere, and they simply can’t create enough 5 WAR players without free agency.

If you’re going to aim for the mid 80s instead of the mid 90s, though, there’s no need to take your average team and add Mookie Betts. You could argue that the teams who will now hunt stars will be the teams in the 75-80 win range, but those teams, by definition, have more holes than the teams that are currently signing top free agents. If Mookie is worth five otherwise unavailable wins to the Dodgers (by upgrading a 2 WAR spot to a 7 WAR spot), he might be worth seven wins to a 75-win team. Unlike the Dodgers, however, that team would have other ways of getting those seven wins. They could make 1-WAR upgrades seven times, five 1.5-WAR upgrades, or some other combination. Again, they’re a 75-win team; it won’t be hard to find holes that could be upgraded through average players, and average players are far more plentiful than demigods.

Some teams might still be willing to live in the stratosphere. It’s inarguable, however, that this structure reduces the incentives to be great. So long as it’s easier to move from bad to mediocre than from mediocre to great, that will exert inexorable downward pressure on the price of labor in baseball.

Maybe this isn’t how you think about the game. To you, the reward for an AL Central crown might be the crown itself. The players and coaching staff probably agree with you — they’ll be out there trying to win just as much as ever. Teams, on the other hand, absolutely think this way. They optimize everything they can, and find solutions that save them a few bucks over and over again. They hire consulting firms to find new general managers who fit that ethos. You might find the lure of a divisional title to be unaffected by a new playoff format, but front offices won’t see it that way. They’ll cheer for the division title, the same as ever, but cold calculations rule team-building these days, and the numbers are clear.

Most of the other arguments against a 16-team playoff come down to taste and supposition. Would fan engagement really fall if division races stopped having meaning? Do people watch their team because of its talent level or because they want to have the sound of baseball on in the background? That’s not a question I have a solid answer for, and I’m not sure anyone does. I would find the regular season less dramatic in the new format, but I’m a baseball writer — I’d darn sure still be watching.

The owners seem to be betting that more baseball just means a bigger pie, that any downstream viewership effects from the new structure will be outstripped by the cost savings from no longer having to rely on free agency as heavily to construct teams who could feasibly win the World Series. That might be right, and it might be wrong — but even if baseball viewership remains static or declines, it might still be in their interests to pursue this plan.

I don’t claim to know what 16-team playoffs would do for the future of baseball in a broad sense. That’s a daunting projection to make, and I’m simply not up for it. I know baseball fans who check out unless their team is excellent and fans who just want to watch a baseball game every night regardless of the stakes. I’m quite confident, however, that it would disincentivize teams from trying to be Dodgers-esque juggernauts, and that that race to the middle would have a chilling effect on free agency salaries. Whatever the public talking points are, this is about money, plain and simple.

Any final decision on whether or not to expand the playoffs will happen in conjunction with the negotiation of a new CBA. It’s not impossible to imagine economic structures that could keep overall player outlay the same despite expanded playoffs — vastly increased minimum salaries, team control in the two to three year range instead of six to seven, and scuttling an arbitration system that saw teams literally exchange a championship belt for the club that did the best job suppressing fair wages. While it might seem like a sideshow, though, make no mistake: expanded playoffs are a pivot point for the way that teams will choose to spend money and build rosters going forward.