MLB Teams Have Learned to Wait on Free Agents
Outside of Shohei Ohtani’s signing with the Los Angeles Angels and a number of deals involving relievers, it’s been a frigid start to free agency, particularly at the top of the class.
As of Jan. 3, Carlos Santana is the only player among Dave Cameron’s top-five free agents to have found a home so far this offseason. Of Cameron’s top-10 free agents, only three have signed. Of the top 20, just five. That’s a pretty unusual volume of transactions.
Consider that, as of this point last winter, 17 of FanGraphs’ top-20 free agents had signed. Nine of the top 10 had come to agreements with teams. In the winter of 2015-16, six of the top-10 free agents had signed by this point and 11 of the top 20.
As front offices return from holiday break, it will be interesting to see when the market heats up and how many free agents are still left out in the cold as spring training nears.
This has been one of the slowest starts to free agency in recent memory. It is likely in part due to some unusual circumstances — particularly, the looming free-agent crop of next offseason, headlined by Bryce Harper and Manny Machado. A team like the Phillies is undoubtedly sitting on most its significant spending power until next winter. The Phillies’ free-agent deals this offseason have been front-loaded. Moreover, some of the largest-market teams — the Dodgers and the Yankees, for example — do not appear to have many glaring needs, having benefited from the arrival of significant homegrown talent.
Given the divide between the projected Have and Have Nots, there might not be many teams — outside of the Rockies, perhaps — that believe significant spending could push them from the playoff bubble into the postseason field.
But there are also some systemic concerns for the Players Association, as well. The new CBA’s more punitive luxury tax is a stronger incentive for the largest-market teams to reduce spending. The Yankees have paid luxury-tax dollars every year of the tax’s existence, and New York ownership seems determined to stay below the threshold this offseason, at least to reset their status as a multi-year violator leading into next year’s free agency class. As I noted in December, baseball’s soft cap has become more rigid and that could have real consequences in free agency.
Moreover, executives increasingly seem to be like-minded in how they view free agency — namely, that it is typically a losing bet. As a front-office official told me last year: “It’s not whether you will lose on a free-agent deal, it’s how much a club will lose on a free-agent deal.”
And when using free agency to try and improve a roster, more and more of these like-minded front offices are learning how to be patient.
Max Rieper of Royals Review found that, from 2013 to -17, free agents who signed before Jan. 1 received guaranteed dollars 4.0% above FanGraphs’ crowdsourced estimates. Free agents who signed after Jan. 1, meanwhile, received 25.3% less than FanGraphs’ estimates.
Wrote Rieper:
This shouldn’t be much of a surprise of course. The most coveted players are going to be inked to deals sooner. The players that sign later are those less desired, or who perhaps misread the market. Often times this seems to be sluggers with defensive concerns, and of course, the previous draft pick compensation system weighed some free agents down in the market.
This winter, of course, it isn’t just the Chris Davis and Mark Trumbo types waiting on a contract from the Orioles; it’s the top of the class like Eric Hosmer, Yu Darvish and Jake Arrieta waiting for the right deal.
In the previous two offseasons, all of the elite free-agent arms had signed by the New Year.
With each day that elapses after Jan. 1, asking prices are more likely to decline than increase.
Moreover, while free-agent classes vary from year to year with regard to their talent and impact, last year was marked by the lowest overall total of free-agent spending ($1.428 billion) since 2012 ($1.175 billion), according to Spotrac. Teams guaranteed a billion fewer dollars to free agents last winter than the previous one ($2.418 billion), according to the site’s data. As of this moment, teams have committed just $534 million to free agents.
And teams do not seem leery of allocating just dollars to free agents but also years. There has not been a single free agent signed this offseason to a deal that guarantees him more than three years of employment. Last winter, by contrast, nine players agreed to deals of four years or longer. In 2015-16, 14 players agreed to deals of four years or longer. There were 13 such deals in the winter of 2014-15.
And while the stars will eventually be signed, while there will be some deals of four years or more, they will be smaller in volume. And it is perhaps the middle class of free agents who will continue to bear the brunt of the devaluation of free agency by MLB teams.
As more and more teams wait on top-end talent — at least this winter — it will push many signings for the overall class into February and later.
NL Exec is right:with so many free agents unsigned, January is the new December for MLB off-seasons. Which means February is the new January. And start a pool on how many free agents aren't signed when Spring Training opens
— Peter Gammons (@pgammo) December 20, 2017
Last season, for instance, 65 players signed free agent deals in February, the greatest number since 2009 and the third consecutive year February signings had increased in volume.
When free agents start seeing spring-training camps open on MLB Network, players stretching and playing toss on sun-soaked fields, anxiety will increase and asking prices will drop.
David Freese had to wait until March to sign with the Pirates in 2016. He didn’t appreciate the uncertainty.
“It was a tough situation to handle,” Freese said. “The waiting, it challenges your heart. Sitting around while guys are out playing… seeing games, seeing guys in the field, it makes you appreciate the game a lot more.”
Freese signed for one year and $3 million, well below his multi-year, eight-figure ask that November.
If this is the new normal, if February is the new January, there is going to be more waiting, more anxiety. From the players’ perspective, that’s not good news for the institution of free agency.
A Cleveland native, FanGraphs writer Travis Sawchik is the author of the New York Times bestselling book, Big Data Baseball. He also contributes to The Athletic Cleveland, and has written for the Pittsburgh Tribune-Review, among other outlets. Follow him on Twitter @Travis_Sawchik.
I think MLB teams are going to fall into two brackets, some contenders looking for specific needs early in the off-season and other teams waiting for bargains. Astros last season stroke early and filled positions that they had complete holes. Angels, aided by Ohtani’s decision, did that this year.
With Yankees and Dodgers trying to get under cap and Astros, Indians, and Nats staying away from big free agents so far, there just aren’t many contenders thinking they need a big free agent splash this year. Outside of years with great free agents, I expect more and more contenders are going to try to develop more from within or with trades for surplus value instead of the free agent market. I expect there will at least be 1-2 teams every year that think they can help themselves more by getting exactly what they want early. Sometimes they will be right.
“Freese signed for one year and $3 million, well below his multi-year, eight-figure ask that November.”
Oddly, 5 months later, the Pirates gave him a multi-year, eight figure contract. Not sure what changed in those 5 months for his value to increase like that.
Kang looking like he isn’t going to ever come back over to the states with a Visa
Interestingly Huntington said the extension had nothing to do with Kang’s legal issues.
Course the article I’m linking to below was written by some guy named Travis Sawchik. Anyone ever heard of him before? Can he be trusted? 🙂
http://triblive.com/sports/pirates/11014464-74/freese-pirates-million
I think the big delay this year is caused by a bunch of things:
-Ohtani stole the energy early on
-Most active trade market for stars we’ve seen in a long while (Stanton, Longoria, Kinsler, potentially Machado)
-The big money teams trying save money for next year’s FA class
-This year’s FAs not lining up particularly well with most contender needs
I agree, 1b usually isn’t a huge market to begin with and it really feels like all the top FAs have glaring holes.
No doubt. Lot of platoon bats at 1B.
I’m surprised the MLBPA isn’t talking collusion. This might be the effect of smarter GMs realizing that big money/years to 30 year olds isn’t great business. By waiting the FA out, the prices will drop.
It’s of course not collusion if agents have received competing offers and are just holding out for better ones. Reportedly, JD Martinez has received a 5-yr offer from the Red Sox but is looking for a longer offer. Hosmer has reportedly received competing +140MM offers from the Padres and Royals.
… and the source of the rumors? The agents trying to drum up interest. I think it is as much likely that GMs now know that waiting results in better deals and are doing so purposefully as it is that next’s years couple elite guys are causing the suppression. This is a trend not a 1 year event.
I’m not saying it is collusion, but I am surprised the MLBPA doesnt think it is (which is what I said). The groupthink here is getting ridiculous.
The MLBPA doesn’t think it’s collusion because they actually know what collusion is.
I don’t understand your comment. Are you saying it’s collusion, or are you saying it’s smarter GMs realizing that big money/years to 30 year olds isn’t great business?
A thaw may be approaching as Bob Nightengale reports the Royals have offered a $147 mil/7 year contract to Hosmer. SD reportedly offered $140mil/7 years. IMO, that’s an absurd contract for him. Also wonder if Boras is releasing this info to get more teams involved.
Maybe I’m just not thinking about this right, but why would a team leak that information? That’s got to be Boras or a source close to him.
I’m also pretty sure that is going to be an albatross for either team, since neither team regularly runs high payrolls and he’ll be in the decline phase when the team is ready to make serious playoff runs again.
Agreed. I think it’s useful to think about who might be behind these “leaks”, and what their motives/incentives are. If it’s not outright made up, I would think it almost has to come from the player/agent side.
(With a different context, I could think of team-sourced leaks as sort of a soft collusion, but I don’t think tipping your hand that you are “only” willing to go to 7 years on a lower-tier star is that instance.)
The Royals have all the reason in the world to tell their fanbase, ‘hey – we offered your favorite player $150 million (double the highest contract in team history!) to stay.’ If Hosmer takes it, okay – the face of your franchise is back, and he helps you sell whatever amount of tickets you think he can help you sell.
If not? GREAT. Because now you’ve rid yourselves of an albatross of a contract you couldn’t afford anyway, AND it’s his fault, not yours. You made a crazy offer to him, and he wanted to play elsewhere.
If I’m the Royals, I absolutely leak this information. 100% of the time.
It had not occurred to me that the team would make a huge offer it didn’t want the player to take. Either I lack creativity or I underestimate the factionalization in a front office.
I don’t think it’s an either/or here. Rewind to the Pujols free agency – by all accounts, St. Louis wanted Pujols back. There were positives to him finishing his career as a Cardinal, and those positives were worth the $170 mil or whatever it was they offered him. But they also weren’t broken hearted when he left, because they’d made a good faith effort for their fans, and there were also negatives to that type of deal (that the Angels now get to deal with).
KC is in much the same position with Hosmer. That dude is an icon there – he’s the second most popular Royal in team history behind Brett. Large swaths of fans will be devastated to see him go. So, there are real positives to having him as a lifelong Royal, and those positives are worth (apparently) $147 mil to KC. But I doubt they’ll be too broken up to let San Diego pay $21 mil for a 0.4 win season in 2022 either.
Leaking the details now just lets your fanbase know, ‘hey – we want the dude back and have made a reasonable offer. If he leaves, you can’t blame us here; we’ve done our best.’
I think I should be insulted by your agreeing with my self deprecating comment, but I get the sense that wasn’t how it was intended. Just FYI
Yeah I must have misread something because I meant no offense or insult at all. In any way, shape or form. Apologies if something I said was insulting!
No worries. We’re good. And your rationale makes sense, at least if you’re crazy enough to give Hosmer that contract in the first place.
Absurd seems a bit strong. Thats an AAV of $21 million which is equal to ~2.5 wins (if my math is up to date). Hosmer has been over 3 wins in three of the past five seasons and is projected for 2+ wins next year.
The problem with Hosmer is obviously consistency (in the other 2 years of the past 5 he has been replacement level) but him averaging out as a slightly above avg player over the next 7 years does not seem like an absurd deal to make. It might not work out but absurd is another level.
There is literally zero reason for the Royals to give him that deal though.
Agreed. 147 over 7 years isn’t going to generate any surplus value for the signing team. But at an AAV of $21 million he shouldn’t start generating negative value until year four of the deal. Its still not a deal that any team should be offering for a player of Hosmer’s limited skill-set. But, it isn’t exactly a millstone.
Hosmer had produced 0.1 WAR or less in 3 of his last 6 seasons
He has also produced 3.5 WAR or more in 2 of his past 3 seasons.
Hosmer is by no means an elite player but going back 6 years is fairly disingenuous.
Over the past 3 seasons,which is probably a lot more relevant than what he did 5 or 6 years ago, he ranks 12th among 1B in WAR, marginally behind guys like Abreu and Santana.
It’s Hosmer. He could absolutely be generating negative value in year one of this theoretical contract.
Remember, the $10 million per win is what teams have successfully bought, not how much they expect to get. Generally speaking, teams are looking for much more value than that.
My hunch is they’re looking for about 2 wins per $10 million (although I have nothing to back that up). It would not surprise me if they were valuing Hosmer as a 4 win player going forward and for that they will surely be disappointed.
It would very much surprise me if any team was valuing Hosmer as a 4 win player going forward.
Teams obviously have more access to info than the public but it seems insane to think that a team would be projecting Hosmer to worth be nearly double what the public see’s him as (steamer is projecting him to be worth 2.6 wins next year) or that he is going to routinely hit what has so far been his absolute ceiling.
It does seem insane, doesn’t it? I bet most don’t, but I also bet that’s why only two teams have offered him that big of a contract.
I think we can only really know what FO’s “expect” in term of wins/$ from asking front office members to fill out an anonymous survey. It could vary across front offices too.
It’s also possible that front offices and agents use a much more rudimentary calculation based in comparison–“if Brandon Belt is worth X, then Eric Hosmer is worth Y.”
There’s like a hundred possible different variations which we don’t know about.
My educated guess is that most MLB front offices think in terms of “how do I sustainably try to get 40 or more WAR from the payroll budget that I have?” That’s roughly the cutoff for a legitimate division contender (an expectation of 88 wins) with the wild card as a fallback. Every team’s payroll budget is of course based on its own business circumstances, and perhaps some high revenue, big market teams such as the Yankees, Red Sox, Dodgers, and Cubs push that WAR target up a bit into the “or more” category.
From that target, and the observed reality of the free agent market, a team can somewhat back into an idea of how many WAR it can afford to buy in free agency (the highest cost) with targets from arb salaries, team-friendly pre-FA extensions, and minimum salary players. The easiest to determine components should be looking at overall average $ / WAR from the payroll budget and then marginal $ / WAR to sign free agents. These targets can’t be set in stone – a team won’t really know for sure how good its prospects are, or even how much production it will get from any player – but that seems like a good framework for rolling multi-year plans from which a team can deviate to some degree as needed or as opportunity presents itself (e.g., a deep post-season run drives higher revenue, including in the next season, some of which is invested back into the team’s payroll).
(I have read quotes from John Mozeliak of the Cardinals where he references having a rolling 5-year outlook in looking forward, which makes sense to me based on length of free agent contracts, player development time in the minors, etc. In other words, visibility gets worse each additional year that a team looks forward, and past five years it’s almost useless because so much of the roster will have turned over and potential key young contributors haven’t even been drafted yet.)
So I think it’s probably somewhat circular. Teams essentially end up with free agent budgets based on the combination of how much they can afford to spend – and how much they need – after filling up the roster with the quality minimum and arb year salary players that they have. The collective available free agent budgets of all teams drive free agent prices, but those free agent prices also feed back into what each team sees as its ideal or “affordable” roster construction per my first paragraph. And, when a team – or at least a reasonably well-run team – sees that the math simply doesn’t work to contend over the next few years based on its payroll budget, cost-controlled talent, reasonable expectations for high minors prospects, and free agent pricing, then that’s the point in time for a team to go through a rebuild of some degree and trade players with present value for prospects.
TLDR version of my lengthy comment: best guess is that well-run teams think in terms of targeting x WAR from free agents, y WAR from minimum salary players, and z WAR from arb/pre-FA extensions, with a goal of x + y + z adding up to ~40 WAR. The split between x, y, and z are obviously very different for the Dodgers or Yankees than for the Rays or A’s due to differing payroll budgets.
A team can’t hit such a target perfectly, so they adapt as needed and as revenue/budget circumstances allow, but I strongly suspect that sophisticated front offices have targets that guides their decision-making and multi-year plans. There’s a feedback loop by which these individual budgets influence total free agent spending, which in turn influences free agent price per WAR, and that in turn influences each team’s breakdown between x, y, and z. Front offices these days are of course highly quantitative, and the overall framework is basically a big optimization equation with certain external constraints.
Sounds reasonable, but also would seem to make the Royals offer even more puzzling given their payroll and position in the success cycle.
Hosmer might well give them 2.5-4 WAR per year for the next couple of years, but we can reasonably expect him to decline after.
They’re not hitting 40 WAR per year for the next couple years even if he outperforms projections, and this contract will make it much harder to hit 40 WAR in the out years.
I think it means that the Royals front office doesn’t believe the WAR calculations for him, for whatever reason.
It is absolutely absurd. Hosmer has produced 0.1 or fewer WAR in 3 of the last 6 seasons, and has never produced more than the 4.1 WAR he put up in 2017. He averages out to a 2 WAR average regular but every year you are taking a 50% risk that he goes pumpkin and becomes a $20m+ black hole.
I’m fairly certain that is not how probability works, lol.
For some team situations, high variance is good. I’m not convinced that’s either of these teams’ logic, though.
Some idiot GM is paying Tyler Chatwood 13 mil a year. Zach Cozart making around the same, Santana will be making 17.5 mil @ 34 years old, so I’ll take Hosmer (who can add 10-15 lbs of muscle still) in a back loaded deal averaging 20 mil. ALL DAY
Chatwood being worth 2 wins a year after getting out of Colorado seems like a reasonable bet, and if it doesn’t work out quite that well, getting only $30M of value for $39M over 3 years isn’t nearly the disaster that the Hosmer deal could be.
The Cozart deal (small commitment, premium defensive player, seemingly real offensive breakout) was an absolute steal for the Angels.
And I’ll take Santana and his consistent on-base skills over Hosmer any day, at the same price. If he happens to get Hosmer’s batted-ball luck one of these years, he’s going to look like an MVP candidate.
there is less batted ball luck for fat guys FYI…I mean just watch him run.
Well, I do see that Santana has a statcast sprint speed not much lower than Hosmer’s (26.7 ft/s vs. 27.5). I don’t claim to know what that translates to in terms of BABIP but I would bet it’s less than you think it is.
(And I also bet you’d be surprised to know that Santana has the same sprint speed as guys such as Gordon, Zobrist, Gennett, and Brandon Phillips).
Maybe there is some reason for Santana’s consistently low BABIPs but it’s not likely to be his foot speed.
So in the course of one day you were unspeakably rude to Travis (saying in the Hosmer article’s comments that he’s not qualified to write about baseball) and stated that Jed Hoyer is an “idiot.”
How about either changing your act or taking it elsewhere?
If only the down votes here actually did something, this would be a much less toxic place in the comments
I think this is definitely true if you’re a pitcher on the wrong side of 30. But the next two years of free agency are going to have a bunch of players who are 28 or younger, and a lot of them are good.
This year we had…Tyler Chatwood and Eric Hosmer? If we’re talking about Marcell Ozuna (not to mention Harper and Machado) I bet you’ll have more aggressive teams.
So I think this is right, but there are going to be some players who are less likely to get snared in this.
I wonder if part of what’s going on here is that teams a few years ago started calling up players younger, and now the free agency pipeline is changing toward younger players starting next year and moving younger over the next two after that. And nobody wants to invest 2021 money into free agents now that they could be using on a 27-yo in 2020.
Other reasons I believe slowing down the free agent market is quality of players, the usual disconnect between agent ask and player values, and the fact most teams value players similarly.
Eric Hosmer is a great example of all of these factors. He has long been a darling of old-school scouting types. He has reached free agency in the prime of his career and Boras is marketing to that. Finally, most teams see him as a slightly above average 1B with questionable defensive value. That is not the sort of player you want to give a 4-7 year deal to, as you end up buying decline and lowering flexibility. You still have teams like the Orioles, Nationals and to some extent Red Sox who operate on emotion, but the days of the albatross free agent contract are being replaced by the days of the premature extension.
Which players did the Nationals sign on the basis of emotion?
Not to speak for jmohan, but Boras has involved Nationals ownership to help get deals completed for Scherzer, Werth and Wieters. Maybe not out of emotion but Boras and the Nationals are rather cozy.
Those moves had decent reasons behind them, though:
Werth was the beginning of the new era, coming off being a star in Philly, showing that the Nats were ready to play with the big boys.
Max was picking up a valuable asset, albeit at a high price. Rizzo had previously talked about strengthening strengths, and at their previous playoff runs had pitching issues and starters had durability concerns.
Wieters…was an overpay worked by Boras. The Lobaton/Severino combo wasn’t going to be great, and the agent did his job and sold his product. Nats just happened to get the worst season Wieters has put together as he (possibly) hit a cliff.
The first two I wouldn’t classify as emotion, at all. Logic and rationale you don’t agree with is still logic and rationale.
That Santana deal still makes zero sense. Looks worse now
It does if they’re looking to contend this year and/or next; intend to add pitching.
I’ve wondered if some teams have committed to a direction. We (well, I) have assumed the Rays are starting a rebuild, but other than Longoria getting moved, they’ve done nothing to really indicate a rebuild. The Orioles, Pirates, and Blue Jays are all on the bubble, and though Toronto has stated they intend to go for it, their actions don’t really suggest they’ve made a concrete decision.
Philadelphia has invested in their bullpen and at 1B, but could probably use a front-line starter (or 2), as well as a 3rd baseman, and will be relying on a lot of youth–more so if they bring Kingery up, though that would likely squeeze Franco out and consequently address 3B.
Maybe the current asking prices of free agents are creating some of this indecision. That would seem likely, but many teams have more than just one area of need to address. In some cases, many areas of need. Should make for an interesting stretch between now and spring.
Not resigning LoMo qualifies as leaning toward a rebuild to me. He’s not going to be worth the contract he gets, probably, so I’m sure that’s also part of it.
But not going after anyone in free agency yet indicates to me that they aren’t looking to contend this year.
They could be waiting it out to pick up the scraps, but I don’t see why they wouldn’t give the gig to Miller and see if he can rebound. They’re likely stuck with his contract anyway.
I’ve wondered if Tampa could package some of the bats with pitchers.
In light of smarter front offices, who are increasingly less interested in paying for free agent decline years, I think it makes sense for MLBPA to figure out a way to get more money into the hands of the most talented players. That is, those still in their prime, who provide the most value to teams, and yet are significantly underpaid.
As a fan, I agree with front offices not overpaying for declining players. However, I AM in favor of the best players getting paid fairly. If the MLBPA wants their players to get a fair chunk of the total revenue, I think their best bet is to figure out how to get the most money into the hands of the most productive players.
Given that the six years of team control is unlikely to go away for competitive reasons, this is why the union’s first order of business is should be to expand and update arbitration. Starting arbitration a year earlier and updating the benchmarks (whatever those are) would rapidly change the amount of money being spent.
Union royally screwed itself with its effort to screw young/international players. It figured that hey, none of the guys already in the union are directly affected by these new rules, but it created such a large disparity in value that no one wants the veterans anymore. Furthermore, having young, cost-controlled talent is now such a necessity to win that teams are more willing to tank individual seasons to compete in subsequent ones, potentially affecting collective team salaries in any given year.
“no one wants the veterans anymore”
Let’s not exaggerate this situation. Most of what we’re talking about here is whether free agents will get an extra year on contracts or accept a shorter (3 or 4 year) deal and whether AAV’s will be a few million higher or lower within a range for players getting $10 million+ AAV’s. With some of the contracts that we’ve seen for pitchers so far, both relievers and starters, that part of the free agent market looks to be both pretty active and pretty robust.
I wouldn’t take the statement that literally; the typical values they have earned in the past should be a heavy underlying implication.
And most of the guys signed are relief pitchers, whom collectively have recently experienced a huge boon in perceived value.
I agree that free agency as it stands is dying. We need to abandon some of the myth of “competitive reasons.” These teams CAN afford to pay more, they just choose profit. Yes, less profit for smaller teams, but still, ridiculous money. If the 6 years won’t die, service time needs to be like 10 games = year 1, and start the clock. Min salary needs to be at least $1M. And yes, arb should start in year 3.
All you’re doing is redistributing the same-sized pie.
That may end up being the case, but teams still want to win, and spending will be a way to differentiate. Also, 1 of the main things killing FA is players signing long term team friendly deals while still under control. If those players already have a few mil in the bank, they are far less incentivized to take those deals.
Again, you’re just describing a re-distribution of the same-sized pie. In fact, if more players are allowed to reach FA earlier, the prices paid for free agents will just go down.
As for FA being killed by long-term pre-FA deals, the big FA class next year anecdotally dispels that notion. Heck, Cameron wrote articles just last year about the “extinction” of pre-arb deals for young superstars.
Indeed, if you want to judge whether FA itself is actually dying, you should read non-anecdotal research about the issue, like Matt Swartz’s pieces on $/WAR on the FA market. Are $ per WAR on the FA market generally going up or down? The answer to this question will tell you about the relative health of the FA market.
Average $/WAR is misleading, though. The elite players are getting their money (Price, Stanton, etc.). It’s the middle class of players that are getting screwed.
We need to see median, not mean.
Needs to be a salary floor and a guaranteed percentage of revenues going to the players.
I agree. I wouldn’t even mind seeing minimum salaries raised considerably.
Minor league salaries (and benefits) also. That’s how baseball is going to get lower class kids to play baseball as football declines in popularity.
If you are a great adolescent athlete and have a good shot at making at least $40,000 a year in the minors even if you don’t need it to the majors, that may appeal to a lot of kids who would otherwise take a chance on basketball or football.
I would endorse that as well.
Having judges that actually understand baseball in the 21st century would be a big start.
As a fan, player movement is fun, especially in the off-season. It’s very difficult to knock teams for not spending money, but it’s also a bummer from an entertainment standpoint that they seem so disinterested.
In the long and short of it, teams are smarter than they’ve ever been in the aggregate. There’s fewer and fewer impulse buys. I think next years FA class plays into this as well. I think where you’ll really see this play out in the near future is you’ll see shorter and shorter contracts. Money will still be there, but only the top end FA’s — assuming they’re the right age — will get huge long deals. The rank and file players need accept that they’ll get 2-3 year deals more often now than 4-5 year deals. They’re still getting paid though.
I’m not sure I buy this as a real threat to the players or players union.
If a substantial portion of teams is happy to sit out the free agent market until January, all it takes is one team to recognize opportunity there and try to steal a march on their competitors. Look at what the Rockies have done with relievers, it just takes one outier for people to get a contract.
For example, I think some teams really missed an opportunity to go all in on Darvish when others were sitting out of the market. It’s too late this year, but I expect some GMs to recognize an opportunity to be the only bidder when there is one. On the other hand if he’s not willing to sign early because he thinks a bidding war in January is more to his advantage, then that’s the choice he makes.
In short, the delay here is two sided, you can’t just pin this on owners, players are equally slow playing it in anticipation of the market heating up later should other chips fall and demand rise.
This is the union’s fault. They helped create a system that made free agency incredibly inefficient. The FA prices are so high that teams don’t even expect significant surplus value from their signings; they just hope to recoup it. How many of the 100M plus contracts handed out in free agency the last few years have yielded surplus value?
lol – Any open auction will lead to a transaction where there is little (or no) surplus value. Indeed, that is why there is something called the “winner’s curse” in MLB FA, because the highest bidder takes the most aggressive position of what surplus value the player is projected to provide, while 29 other teams stop bidding. Who is likely to be correct on the amount of surplus value – the 29 teams who stopped bidding (because they don’t project any surplus value) or the one winning team (who still thinks there is some surplus value even in its highest bid)?
This the way the way the union, the agents, and the players want it. This is a feature, not a bug – it is how an efficient FA market works. They want players to to get paid to the point where there is no “surplus value.”
This is pretty nit-picky; most FA deals, especially the larger ones, have failed to provide adequate returns; accordingly, the statement “hope to recoup value.” Surplus value is probably the wrong term to use, but I don’t think it was that hard to figure out the gist of the post, that free agents have generally been overpaid, but props to you for taking the time to give a lesson on economic jargon.
“that free agents have generally been overpaid”
A key point, though, is that surplus value analysis defines overpaid or underpaid relative to the observed cost of WAR across the free agency market as a whole. So if one part of the market – long-term, high AAV contracts – looks noticeably worse than that total, then it’s logical to expect some degree of market correction as teams notice that and allocate money differently.
Illustrating that as a specific example, let’s say that Logan Morrison will provide something like 75% of Hosmer’s production over the next 2 years at 60% of the annual salary and without the risk from the long tail of possible decline years signing Hosmer for 5+ years in total. If that’s a reasonable expectation, then we’d expect for the market to adjust as more teams pursue players like Morrison and then find other ways to deploy the savings (extend a team’s young players, sign bench players for depth, etc.)
Scherzer has already been worth $150m from 2015-2017 according to his page here. He just needs to be worth $60m over the next 4 years for his contract to work out for the Nationals.
And that’s without even considering the backloading/deferred nature of it.
I agree.
Some of it looks to be a robust trade market slowing down free agent activity, as HamelinROY mentions above: Stanton, Ozuna, Longoria, Kinsler, plus rumors around Machado and Donaldson.
I also suspect that some of the delay is simply that so many of the top free agents are Boras clients and that Boras’ standard negotiating style is well-known to include waiting out the market. Boras clients this year (Martinez, Arrieta, Hosmer, and Moustakas) are #2, #3, #5, and #8, respectively, on Dave Cameron’s top 50 free agent list. These players also have an indirect impact on other players who are either direct substitutes or could be an alternate way for a team to spend its free agent budget.
Other factors not stated in the article are the lack of a payroll floor and the fact that the draft system rewards teams for tanking. Why commit $50M-$60M over 3 years to a slightly above average player that helps you win a couple more games each season? There is very little difference between 74 and 78 wins. Keep the money and get higher draft picks each year where at least there is hope of getting a future star. It really seems like an easy decision to me.
Interesting topic. But the (perhaps) growing anxiety of free agents in this era is just one part of the broad “contract anxiety” picture. Counterforces include a growing share of players signing long-term deals for above-average salaries before ever reaching free agency.
As to Freese, his free agency suffered from unfortunate timing. He hit FA going into age 33 (older than most first-timers), 3 full years after his one marginally All-Star-caliber season, and 4 years since his postseason heroics (with crappy numbers over 3 subsequent postseasons). With a low ceiling set by his recent performance (3.3 total bWAR in his prior 3 years), and a very low floor set by his age, he was exactly the type of player of whom the market *should* be leery, regardless of the surrounding FA context.
Yeah, it’s not just free agency itself changing, but there are pre-free-agency factors influencing the FA market — not just the early signing of the arbitration buy-out contracts (causing players to hit free agency a little later and with fuller pockets) but also the qualifying offers. Wasn’t it the case about 2-3 years ago that no one had ever accepted a QO? Or nearly so, at least; and now we’ve seen a number of them, changing the situation for teams that want to either maximize their return or their chance of retaining a near-free-agent player.
Yes, Travis talks about Freese quite a bit when Freese was something of an outlier who stood out for his weak market after 2015 compared to other over 30 free agents with similar 2015 fWAR totals. (As I laid out in a comment here – https://www.fangraphs.com/blogs/mlbs-middle-class-has-a-free-agency-problem/ .)
That said, Freese perhaps is one illustration that modern roster construction limits the demand for veteran free agents who might still be useful players (in a vacuum, without roster limits) but are tough to fit on rosters as currently constructed. At that point, it was understandable that teams would hesitate to bet on Freese as a starting caliber player, both due to age and due to an average of only about 130 games played over the prior three seasons (and no more than 138 games in any of those seasons). He only plays 3B, with a presumed ability to play 1B also if needed. That’s a somewhat challenging player to fit on a 4 or 5 man bench, relative either to (1) a veteran FA who is a true utility player or (2) a young player with option years available who can be stashed in AAA as injury depth.
If the MLBPA wants to help demand for a veteran player such as David Freese (or 1B/DH types such as Chris Carter or Pedro Alvarez), the solution is to expand MLB rosters by 1 or 2 players, perhaps paired with a cap on the total number of pitchers on the roster.
This is simply a recalibration of the value of a baseball player resultant the latest labor agreement, particularly those in the age group of 28-32, where most free agents lie. Agents are particularly stubborn about accepting such adjustment in values, because they have typically been able to find at least one ill-advised owner/GM to overpay for their clients, as evidenced by the numerous insane contracts handed out in the past. Clearly, the analytical community has long espoused the lack of efficiency in free agency for many years and its increasing authority in baseball in combination of a new labor agreement that further devalues veterans has created what we are seeing today.
If only Theo had waited to sign Heyward…until it was too late.
Just anecdotally, 2 of the 3 players Travis cites as “top of the class” reportedly sought deals well above the consensus estimate of their value. Hosmer and Arrieta, who are also 2 of Dave’s top 5, have very wide variance in their recent performance:
— Three of Hosmer’s 7 full years scored 0 fWAR or less, including 2016.
— Arrieta was brilliant for about 3 years, but his last 50 starts show a 4.33 RA/9 and 5.8 IP/G, with a SO-BB% that’s roughly last year’s median for NLers with 140+ IP. His 2017 alone was right at the median for such NLers by FIP, xFIP and SIERA — yet he still wants to be paid like a guaranteed ace, heading into age 32.
Both are projected for 2.7 fWAR next year, and I’ll take the under on each. And the 3rd player Travis named in this class, Darvish, has issues of his own. So it’s not surprising that those guys are taking a long time to sign, which might be affecting lesser players.
Bottom line, every FA class marches to its own beat.
I don’t disagree about what’s going on with Hosmer — he seems like the kind of Boras guy who hurts himself by waiting in a thin market — but I’ll admit to a little surprise about Darvish and Arrieta not having big deals, or even big rumored/leaked offers, by now. The pitching market does seem a little bit strange this year, I guess because dollars are being reallocated toward relievers.
Personally, I’m not so sure the middle class of free agents will be worse off if the top class is unsigned. Look at what Boston and Cleveland have done at first base. They decided that Hosmer was a bad investment, so they signed lesser free agents (Moreland and Alonzo) for less years and money.
Fwiw, a capsule look at the weirdness baked into the FA system:
— Year 4 is the collective bWAR peak this century for position players who were good during their first 6 years.*
— Clear decline is in place by Year 7, the earliest FA year for most players.
— With Years 4-6 as a base, Years 7-9 totaled 65% of that bWAR, and Years 10-12 totaled 31%.
— With Years 3-6 as the base, Years 7-10 totaled 61% of that bWAR.
— Years 7-12 totaled 62% of the bWAR of Years 1-6.
*Study based on Baseball-Reference data of the 157 position players with (a) 5+ bWAR during Years 1-6 and (b) a debut from 2000 to 2006. All such players have now had the chance to play at least 12 years.
“the projected Have and Have Notes”
I have notes! They say “don’t give Eric Hosmer a 9-figure contract.”
Unless it is for 20 years and started 6 years ago.
I believe another main reason is that teams are simply getting smarter. They are realizing the value of defense, less willing to take on inherently risky huge pitching contracts, and are aware that the vast majority of free agents are on the downturns of their careers or will be soon into their big multi-year deals.
Players have expectations that the teams will spend like they have in the past, and with that no longer being the case, they’re desperately holding out.
Sure Hosmer’s not going to go hungry, and Darvish will still get his $100M+, but in general I think we are seeing a fundamental change in how the market values free agents in all but the most unusual cases (Machado, Harper, maybe Kershaw).
It would not surprise me at all to see the union fight tooth and nail for a shortening of the arbitration (and pre-arb) time, thus allowing players to become free agents a year or so earlier, because that’s the main way they’d be able to recoup some of their “lost” value.
This is called collusion
Yes, collusion in the same way that all 30 teams making the same decision to sign Yu Darvish for $600k a year (if given the chance) is collusion.
Its easy to wait when you know what offers other teams are making or not. I am reminded of the information exchange MLB was using that was exposed in the collusion trials that convicted MLB. Might be something similar going on.
Well of course signing FA is not great business on its own. But its the deal owners made with the MLBPA. Players union agreed to keep the majority of their members under below market wages (median end of season salarybonly 600K) and in return the minority of players who last long enough to enter Free Agency get paid a lot.
Players share of revenue has dropped from 52% to 38% since MLBPA charged MLB with collusion after the 2002-2003 season. MLB settled w/o admission but players share of revenue has continued to plummet, especially over the last 7-8 years when MLBPA last used the collusion word.
MLB has a lot of experience battling collusion charges and has probably gotten a lot smarter about it. MLBPA has made their job easier with awful CBA’s, especially since the Weiner/Clark era. They also have not done a great job of selling the players value to the public and allowing MLB to have a monopoly on media influence using access/information/dollars to get what they want.
Virtually every article we read is how bad a contract is and how little a player is really worth (especially good hitters which are in the shortest supply). Rarely when discussing contracts is any attempt made at adjusting the contracts value today to payroll inflation and MLB revenue. If that were to be done one would discover the most expensive contracts were paid out in 2000-2001. Can’t have that. The public must be made to believe players are overpaid and feel bad for the owners who are being taken to the cleaners by greedy agents and dumb GM’s (who now have suddenly and all together gotten smarter,even those who were GM for 20 years)
So basically if MLB insists on not wanting to pay FA, and continues to play service time games to keep players 7-8 years only to cry they are too old when eligible for FA, then players will have no choice but to strike and force FA for all or at least hold out for a drastic reduction in teams control (3 years, arb after year 1)
Also players should insist on a tie in between payroll and revenue going forward and significant increases in minimum and minor league pay (40 man). But nothing of the sort is happening until Clarke is shown the door and that outside counsel of theirs who thinks drones shooting citizens by Presidential orders is ok.
“Awful CBA” is a bit harsh. What choice do they have against a protected monopoly with money to burn ?
They have very little bargaining power.
They could strike.
I’m not saying that’s a good idea, but it is an option.
NO COLLUSION !! NO COLLUSION !!
YOU’RE THE PUPPET !!
I think it’s possible that what you are seeing here is a lack of truly choice Free Agents with a bit of casual, almost impromptu collusion. Money is being spent on relievers, but ownership no longer seems to believe that franchise-player sized contracts necessarily imply franchise players.
“It (Mike Trout) is so choice. If you have the means, I highly recommend picking one up.”
It’s clearly time to change how the club controlled seasons are paid. It’s probably a good thing that incentives have pushed the Yankees and Dodgers to occasionally not post the 2 highest payrolls. But that should come with an additional reward to the players. Perhaps 5+ seasons of club control instead of 6+ with only 2 pre-arb seasons.
I wonder how this affects the extensions of young players. If I’m a 24 year old who will be a free agent at 29, I probably put more thought into buying out my first 2-3 years of FA after seeing this.
Flip side, if I’m a GM, I try to buy those years with the money saved on FA.