The Dodgers Have Signed Shohei Ohtani. What Does It All Mean?
Shohei Ohtani is not on a plane to Toronto. He’s not hiding in your linen closet or lurking off the coast of Jamaica in a submarine. After years of intrigue, weeks of speculation, and days of looking for signs in flight plans and sushi restaurants, it’s over. After a free agent courtship to fit the player — in other words, unique — Ohtani will be a Los Angeles Dodger.
This is hardly the most interesting outcome. There will be no reset to the competitive order, no validation of an underdog’s creative sales pitch or intriguing roster construction. The Dodgers were already one of the best and most heavily scrutinized teams in baseball, and if Ohtani doesn’t mind a bit of a commute, he won’t even have to move. But if the destination is a bit of an anticlimax, the contract is dramatic enough to pick up the slack.
Ten years, $700 million. Seven. Hundred. Million. Dollars.
Obviously, it’s the biggest contract in the history of sports. It’s within a Bryan Reynolds of being as big as the second- and third-richest contracts in baseball put together. It’s enough to make a person want to stop using hyperbole, because when Mike Trout’s $426.5 million deal is an “incomprehensible” amount of money, what does the mind do when confronted with an additional $273.5 million, over a shorter term?
So yeah, Ohtani doesn’t have to move, because on that salary he could commute to Dodger Stadium by rocket ship if he wanted to.
Apart from the dollar figure — and if your ears are still ringing from “$700 million,” by all means, take a moment to collect yourself before you read on — there are two interesting components to this contract.
The first is the fact that it has no options or opt-outs. Over the past five years, Bryce Harper has perfected the art of spinning a no-opt-out contract into a sign of commitment to and faith in the organization; no doubt Ohtani will learn from his example. More than that, it means we won’t have to do this whole rigmarole again in four or five years.
The second is that more than half of the deal is in deferred salary, apparently at Ohtani’s insistence, in order to mitigate the massive financial impact of the deal on the Dodgers and help the team spend to remain competitive. The Dodgers are no stranger to contracts with big sticker values and lots of deferred money. Mookie Betts deferred $115 million of the $365 million contract he signed in 2020, to be paid in installments, without interest, over the 12 years after the contract ends.
Having to wait to get paid reduces the practical value of the contract; this is why you should take the lump sum and not the annuity if you win the lottery. As a result, on contracts with deferred money the MLBPA calculates the amount by which deferrals lessen the contract’s value — in Betts’ case, by about $5 million a year. That number is used to determine the contract’s value for competitive balance tax purposes.
Until the details of Ohtani’s contract are made public, our Jon Becker estimated what deferring most of Ohtani’s contract might look like financially. This estimate assumes $40 million in deferred salary per year, to be paid out in four-year increments after the contract ends.
The interest rate was applied extremely incorrectly, and upon fixing the formula, I got a staggeringly different number. Upon recalculating, the $400M in deferrals goes down to *$129M in present value* based on my hypothetical schedule, bringing the total down AAV down to $42.9M. pic.twitter.com/fKUdDDTLEg
— Jon Becker (@jonbecker_) December 10, 2023
The Dodgers could be deferring more salary, or paying it out over fewer years, but this estimate brings the AAV of the deal down to a hair under $43 million a year. If the real deferral ends up being anything like this number it’s a huge bargain. Aaron Judge, who was a year older at the time he signed and also, you know, doesn’t pitch, got $40 million a year from the Yankees last year. Even if the MLBPA number lands closer to $50 million, this contract is a hometown discount. Particularly because Ohtani can create value for his employer the way no other player can.
Ohtani has always jealously guarded the details of his private life and is the most meticulously noncontroversial player in the game. He makes Trout look like Dennis Rodman. Either in spite of or because of his approach to fame, Ohtani is the most marketable baseball player of the 21st century. The Dodgers are going to make a huge chunk of this contract back just in promotions and merchandising, maybe as much as half of Othani’s salary. They’re going to sell more no. 17 jerseys than Fanatics is able to print. (Savvy consumers will note that this was also true when Miguel Vargas and Joe Kelly wore no. 17. But you get the point.)
Then there’s the on-field impact. The Dodgers are one of the blessed few teams that understands how to make money by putting out a winning product, rather than just slashing expenses. Ohtani’s on-field contributions help the Dodgers sell tickets and advance in the playoffs, which should also fatten up their coffers.
What are those contributions? It’s a bit perverse that the most important part of the Ohtani signing is the least interesting, but if you’re reading or even aware of FanGraphs, you probably already know what Ohtani is about.
It’s fair to be concerned that a torn UCL will keep Ohtani off the mound for all of 2024, but even if Ohtani vowed never to throw a baseball again, he would’ve been the highest-paid free agent of this class. This past season, Ohtani hit .304/.412/.654 with 44 home runs and 20 stolen bases. His wRC+ of 180 was the highest in baseball by 10 points and the highest of any qualified hitter in this class by 46 points. On Friday, I wrote about the enormous collection of runs Juan Soto might score hitting in front Aaron Judge. Betts could score even more hitting in front of Ohtani and Freddie Freeman.
Even as a DH who only played 135 games, Ohtani was fifth in position player WAR in 2023. And that’s ignoring the contributions he can make as a pitcher once his elbow recovers.
It remains to be seen how much Ohtani will be able to pitch in the long term. He’s qualified for the ERA title once in his career, and has made more than 10 starts just three times. The 2024 season will be Ohtani’s seventh in the majors, and of those, he will have pitched basically three full seasons. But when he’s on the mound, Ohtani can be dominant. The one season he qualified for the ERA title, he struck out 219 batters in 166 innings and posted a 2.33 ERA. His pitching alone was worth 5.6 WAR.
Ironically, the Dodgers probably need Ohtani more as a pitcher than a hitter right now. After Ryan Pepiot, things get a little dark, and when listing off their starters, you get to “after Ryan Pepiot” about two rotation slots sooner than would be ideal.
But the nice thing about a 10-year contract is it gives Ohtani plenty of time to heal. And when he does, well, he’s the answer to a question that’s troubled humanity for decades: What would it be like if Spencer Strider were growing out of Corey Seager’s torso like Kuato from Total Recall? It turns out such a player is worth $70 million a year, minus some deferred money.
If you want further evidence of how special Ohtani is, and why he’s worth this much money, consider the conditions under which his free agency played out. Ohtani made it known up front that he did not want to be courted via the public rumor mill, and his suitors obliged by refusing to discuss him even on background.
Ironically, the resulting information vacuum generated league-wide hysteria all on its own. On Monday, Blue Jays GM Ross Atkins skipped the first day of Winter Meetings, reportedly to meet with Ohtani at the team’s spring training facility in Florida; when asked about his whereabouts on Zoom, Atkins obfuscated, as if he was on the run from Interpol.
When Dodgers manager Dave Roberts told reporters that his team had met with Ohtani, speculation swirled that even acknowledging the meeting constituted an unforgivable breach of the omerta, and that Ohtani might choose to sign elsewhere as a result. Farcical elements of the story continued into Friday, when a private jet purportedly carrying Ohtani to Toronto for a physical turned out to contain only the guy from Shark Tank (no, not Mark Cuban, the other one) and his family.
With Ohtani still at large, the teams that were still in on him did not want to commit big money elsewhere. And with a few exceptions (Aaron Nola and Sonny Gray, who signed with teams that were never serious candidates for Ohtani), the other potential top free agents decided to wait the market out until the Ohtani runners-up were flush and desperate. The result was two and a half extremely slow days in Nashville, until the Juan Soto trade chatter heated up, and some mild blowback as a premier offseason news opportunity turned into a non-event. (I had the two best helpings of grits I’ve had in my life on Monday and Tuesday, so everything turned out fine.)
Ohtani’s nonexistent relationship with the media has the potential to cause some problems downstream, but that’s an issue for another time. He’s entitled to conduct his free agency however he pleases; while it was inconvenient that the rest of the league was waiting around to see what he would do, that’s not really his problem. Besides, it’s not every offseason that one player can hold the entire market hostage like this, and we got plenty of wild stories out of it anyway.
Or let’s put it this way: Any list of the most special players in the league, the ones who are most difficult to replicate or replace, would have Ohtani at the top. But Soto would be close behind, maybe no. 2. Soto got traded this week, to the New York Yankees, in a deal that signals the potential dismantlement of a major contender and nationwide hipster favorite team. And it held the top spot in the news cycle for maybe 36 hours.
Ohtani is such a titanic figure that he can knock Juan Soto and the Yankees off the front page by not getting on an airplane and not attending Yusei Kikuchi’s fancy dinner party in Toronto. When Ohtani went off the radar, the entire sport stopped in place. That’s just another thing only Ohtani can do. He’s unique, and he’s getting paid like it.
Editor’s Note: An earlier version of this piece contained an incorrect estimate of the AAV of Ohtani’s deal once deferrals were accounted for; an updated estimate is now included. FanGraphs regrets the error.
Michael is a writer at FanGraphs. Previously, he was a staff writer at The Ringer and D1Baseball, and his work has appeared at Grantland, Baseball Prospectus, The Atlantic, ESPN.com, and various ill-remembered Phillies blogs. Follow him on Twitter, if you must, @MichaelBaumann.
He’s being paid like he’s the greatest baseball player that ever lived.
He might not be the greatest, but he is probably the most unique.
He is the greatest. Clearly. That was a joke.
He is being paid for being the most talented baseball player ever
…which he is.
Imagine what Ohtani would do if he spent a season playing against a collection of MLB’s 749 best white lads.
Lol, no he is not. Not even close.
Shohei Ohtani has 31.7 WAR across 6 seasons; even if we called it 5 seasons and just throw out 2020 entirely he’s averaging just over 6 WAR per season. Through his own age 28 season the only two years in which Mike Trout did not put up at least 6.3 WAR were 2020 (he had 2.5 WAR in the pandemic-shortened season, which prorates to 6.75), and 2011 (he played in 40 games and was 19 years old). Barring something truly ridiculous like Ohtani putting up multiple 10+ WAR seasons in his 30s after having none in his 20s, he wont ever belong in the same conversation as Mike Trout.
He’s accumulated 26 WAR over the past 3 seasons, which comes out to an 8.7 average. Trout hasn’t been worth 26 WAR over 3 seasons since 2014-16, 8 years ago.
I’d also argue that while Trout’s prime has undoubtedly been better than Ohtani’s prime so far, Ohtani’s ceiling is actually higher. His best hitting season was 5.6 WAR and his best pitching season has been 6.6 WAR. So he at least theoretically could put up a 12+ win season at some point. I’m not sure that’s likely, but it’s possible.
“He’s accumulated 26 WAR over the past 3 seasons, which comes out to an 8.7 average.”
Prime Mike Trout ate 8.7 WAR seasons for breakfast. Mike Trout had an 8 season stretch in which he averaged 8.8 WAR. Ohtani would need to be as good from age 29 (a season in which he wont pitch) to age 33 as he was from ages 26-28 in order for his prime to be equal to Trout. Thanks for proving that Ohtani has no realistic chance of having a career anywhere near as good as Mike Trout.
“Trout hasn’t been worth 26 WAR over 3 seasons since 2014-16, 8 years ago.”
That’s because Mike Trout is no longer in his prime. Did you not know that? Why even bring this up?
“I’d also argue that while Trout’s prime has undoubtedly been better than Ohtani’s prime so far, Ohtani’s ceiling is actually higher.”
Yes, I agree, Mike Trout is no longer in his prime. But this was a discussion about best player ever, not best player currently playing. Feel free to reread roob’s post if you don’t believe me.
“So he at least theoretically could put up a 12+ win season at some point. I’m not sure that’s likely, but it’s possible.”
It was also possible after Mike Trout’s age 21 season that he would at some point put up a 12+ win season. It was far more likely at that point than it is that Shohei Ohtani ever will. The highest single-season WAR projection ZiPS has for the rest of Ohtani’s career is 6.6. He would need to almost double that to put up a 12+ WAR season.
Dismissing the results of a player after the age 25 because he’s no longer in his prime – even a player as great as Mike Trout, who was 25 in 2016 – pretty much disqualifies that player from greatest player ever.
Hank Aaron, from 1956 through 1969, a 15-year stretch, was worth over 7.5 wins/year per FG, and was never worth less than 6.8. Even better if you use Baseball Reference – worth over 8 wins/year, never worth less than 6.8 wins a year.
While an all-time great and inner-circle HOFer, I never hear Hank mentioned as the greatest of all time. And that’s because of ceiling. Per FG, he was never worth more than 8.9 wins, per BR 9.4. He was exceedingly consistent. Consistently great, but ceiling is important, as is longevity when it comes to greatest player ever.
So you can always play this longer than game. What’s better, 8 years of 8.8, or 15 years of 7.5 to 8.0?
Not acknowledging that Ohtani is redefining the game, redefining what we know is possible and baseball players are capable of at the highest level seems – I don’t want to say dishonest – but a little biased at least. There’s also the matter of the saved roster spot, and being able to roster another player that presumably adds more than zero value to the roster and a unique roster flexibility advantage that all of one team in baseball gets; the team with Ohtani.
We don’t know Ohtani’s ceiling, and we don’t know how he’d do as either a hitter-only or a pitcher-only, but presumably, it’d be some amount of better than he does while splitting duties. And he’d almost surely be a RF that provides value with the glove in that instance.
Odd that you’d dig in using the ZIPS projection of 6.6 on a year where Ohtani literally just put up 9 wins. It’s reasonable to say that projection systems will have trouble with Ohtani, because there has never ever been another player like him. That doesn’t mean they’re to be ignored, but it does mean that they’re going to be less accurate with him, because how can they not be?
And then there is also the matter of the fielding. Fielding is the least reliable metric included in WAR, the most debated and varied, and the one that’s possibly wrong – up or down – but likely on the high end. Or at least, the penalty for DH is too severe, and that’s pretty broadly agreed upon, though certainly not universally so. Still, what is nearly universally agreed upon would be that Ohtani’s WAR figure is more reliable than Trout’s, and unlikely to ever have a future adjustment due to a better way to calculate defense being accepted.
None of this is to throw salt on Trout, I was one of the people believing we were watching the early career of quite possibly the greatest baseball player that ever lived. And he is great. But not the greatest.
We got to see Mickey Mantle, live. Now we get to see Babe Ruth, live. He’s a better pitcher than Babe, who was a damn good pitcher and would’ve made the HOF had he never taken up hitting but kept pitching another 12 or 15 years. And we don’t know how the adjustment with hitting goes, certainly Babe was the most dominant hitter relative to his league the world will ever see this side of Bonds, but doing it in today’s day and age is far more impressive simply because of how good pitchers are today, and how quickly the game pushes itself to new heights.
Who cares to argue the details of how long these things are true? The point is they are true, right now, and we get to witness it. That’s special. The fact that I’d guess 90%, 95% of FG readers would take the over on that 6.6 WAR estimate is telling. And the other fact is FG is the most pro-Mike Trout forum there is, no one here is insulting him in any way, shape, or form. He’s only used as a measuring stick because it’s universally accepted here that he had one of, if not the greatest start to a career of any player ever, and certainly in the modern, post WW2 era.
“Dismissing the results of a player after the age 25 because he’s no longer in his prime – even a player as great as Mike Trout, who was 25 in 2016 – pretty much disqualifies that player from greatest player ever.”
I never did this. If the best you can do is lie about what I said then don’t bother saying anything at all.
“Hank Aaron, from 1956 through 1969, a 15-year stretch, was worth over 7.5 wins/year per FG, and was never worth less than 6.8. Even better if you use Baseball Reference – worth over 8 wins/year, never worth less than 6.8 wins a year.
While an all-time great and inner-circle HOFer, I never hear Hank mentioned as the greatest of all time. And that’s because of ceiling. Per FG, he was never worth more than 8.9 wins, per BR 9.4. He was exceedingly consistent. Consistently great, but ceiling is important, as is longevity when it comes to greatest player ever.”
No, you never hear Hank Aaron being argued as the greatest of all time because you don’t listen when other people talk. People call him one of the best players in baseball history all the time. Again, if your entire argument relies on lies just don’t make it.
“Not acknowledging that Ohtani is redefining the game, redefining what we know is possible and baseball players are capable of at the highest level seems – I don’t want to say dishonest – but a little biased at least.”
Wow. After nothing but lies so far it is very restrained of you to not call me dishonest. And on something totally meaningless and irrelevant, too. Mike Trout hits and plays center field. Shohei Ohtani hits and pitches. There values as baseball players is equal to their values as baseball players, not some magic formula that gets a boost if their defensive position is pitcher.
“There’s also the matter of the saved roster spot, and being able to roster another player that presumably adds more than zero value to the roster and a unique roster flexibility advantage that all of one team in baseball gets; the team with Ohtani.”
A free roster spot? That’s what you think tips the scales in Ohtani’s favor? The ability to sign a 0.2 WAR utility infielder? If Ohtani’s value hinges on an extra scrub hanging out on the end of the bench then he is the most overrated player of all time. I don’t believe that is true, which is why I didn’t bring up the nearly worthless value of an extra roster spot.
“We don’t know Ohtani’s ceiling, and we don’t know how he’d do as either a hitter-only or a pitcher-only, but presumably, it’d be some amount of better than he does while splitting duties. And he’d almost surely be a RF that provides value with the glove in that instance.”
Wait, are you saying Ohtani’s hitting and pitching is a DISADVANTAGE now? So why did you just lie for multiple paragraphs and say his hitting and pitching is a huge advantage and should overcome a massive WAR deficit?
“Odd that you’d dig in using the ZIPS projection of 6.6 on a year where Ohtani literally just put up 9 wins.”
Odd that you don’t think baseball players . . . can have a season in which they produce less WAR than the previous season I guess? If a player puts up a career high in WAR their projection will almost always be for less WAR the next year. I’m happy to take some of your money if you don’t believe me and want to bet on it.
“It’s reasonable to say that projection systems will have trouble with Ohtani, because there has never ever been another player like him. That doesn’t mean they’re to be ignored, but it does mean that they’re going to be less accurate with him, because how can they not be?”
And yet you magically know they are not only wrong on him, but specifically underestimating him? What if, and I know you will have trouble imagining this possibility, but what if they might actually be overestimating him? That would make him worse than you think, and mean the 6.6 WAR projection is actually too high, not too low. Do you have some reason to assume Ohtani will outperform projections, or are you just wishcasting?
“And then there is also the matter of the fielding. Fielding is the least reliable metric included in WAR, the most debated and varied, and the one that’s possibly wrong – up or down – but likely on the high end.”
Likely on the high end? Just automatically all fielders are overrated by fielding WAR? What?
“Or at least, the penalty for DH is too severe, and that’s pretty broadly agreed upon, though certainly not universally so.”
As long as the DH penalty is being accounted for (which Fangraph’s does), I don’t see any reason to think that. If you want to try to demonstrate it you’re free to, but I don’t think you will.
“Still, what is nearly universally agreed upon would be that Ohtani’s WAR figure is more reliable than Trout’s, and unlikely to ever have a future adjustment due to a better way to calculate defense being accepted.”
Again, you just seem to magically know that these adjustments would be in Ohtani’s favor and not Trout’s. This is either because you have some kind of evidence that Trout’s defense is currently overrated, or because you have no evidence and just hope it is true. Which is it?
“None of this is to throw salt on Trout, I was one of the people believing we were watching the early career of quite possibly the greatest baseball player that ever lived. And he is great. But not the greatest.”
I agree; Mays is my pick for best player ever. I don’t buy into the idea that today’s players are so far ahead of past players that we can’t cross-compare across eras. But Trout is so far ahead of any reasonable expectation for Ohtani that it is laughable.
“And the other fact is FG is the most pro-Mike Trout forum there is, no one here is insulting him in any way, shape, or form. He’s only used as a measuring stick because it’s universally accepted here that he had one of, if not the greatest start to a career of any player ever, and certainly in the modern, post WW2 era.”
I know why I say what I say. You don’t have to try to explain my own comparisons to me. The reason I brought up Trout to compare against Ohtani is because there is absolutely no possible argument for any reasonable projection of Ohtani that puts him anywhere near Trout’s projected career value, and because their careers overlapping mean Trout can’t be dismissed the way past-era players could be.
I did not use Trout as the comparison because the start of his career was so special. I brought up Trout as a comparison because by the end of both of their careers Trout is overwhelmingly likely to have significantly more WAR. The shape of their careers is irrelevant to that fact.
I’m going to wade into this discussion.
First, I agree Shohei will have a difficult time surpassing Trout’s career WAR. Now, going forward, does Shohei’s abilities justify this new contract? I think that’s a different question, and Trout’s early performance in MLB is less relevant here.
I believe the previous poster’s use of the last 3 years of Shohei’s performance is a better metric for this contract. Trout was worth a shade less in his 3 years before signing in 2019. It is something like 26 WAR versus 25 WAR, so very close.
I think something people aren’t mentioning, is how well Ohtani’s skillset will age. Trout relied on playing very good defense at a premium position (CF) that requires speed. Speed is one of the first things to go as you age. CF is prone to injuries.
In contrast, Shohei doesn’t have to play in the field, much less a running position. And pitchers regularly pitch into their late 30s. Granted, pitchers also blow out early as well.
There are reports that Toronto submitted a competitive offer. So somehow, teams do value Ohtani beyond the on field numbers. I’m not sure how that all works out… but it sure does seem like Ohtani creates a lot more attention than Trout ever did even in his prime.
Ohtani is a slightly better hitter now than peak Trout. You forget that Trout got a ton of value from his glove and the fact he leadoff early in his career. Nearly All of Ohtani’s hitting value comes as a Dh which has the biggest positional adjustment, even though it is clear the guy is capable of being a very good defensive OF.
You are a lunatic.
Trout: 11 straight seasons of wRC+ of 167 or higher.
Ohtani: 1
Trout’s top 3: 189, 188, 180
Ohtani: 180, 150, 149
Putting up 8 WAR in 650 PAs and 150 IPs isn’t the same as putting up 8 WAR in 650 PAs. Ohtani also has negative roster value because he forces teams to use a 6th starter. He’s still great obviously and I’m not putting him down, but comparing his WAR totals to other players without any adjustments is overstating his value.
You can’t just combine Pitching and Batting WAR. They have significantly different distributions. 6.6 pitching WAR is much rarer than 6.6 batting war. Being that good at both sides of the game is not the same as batting a bit better.
He deserved this and more. He is so phenomenal and popular that the Dodgers could have paid $100 million a year and still break even. Now Dodgers just need to sign Yamamoto fur 10 years and $350 million and laugh all the way to the bank.
Hot take: literally nobody deserves to get paid $700 million for playing baseball. He absolutely is absurdly talented, but that’s more money than anyone ever needs.
Ehh sure. But the most talented player in an entire field always is gonna get ridiculous money. Keanu got 156m for one movie. There are doctors making nearly as much as he is per year, and there is only one Ohtani. The best at any individual thing is gonna get a lot. Never liked this argument because where else should the money go? Because if it isn’t to the players that means you want it go to the owners.
lower ticket prices?
Salaries and ticket prices have absolutely no connection to each other except PR spin, buddy.
Ticket price is a simple supply and demand thing: whatever the market will bear, the team will charge. The addition of a player, or the quality of a team, may increase the price that the market will bear, but ticket prices don’t go up because owners have to pay more in salary – they go up because *people will pay more*. If it did not go back out in salary, it would go into ownership’s pocket.
The Dodgers have one of the largest stadiums in MLB now (since all the old multipurpose stadia are gone) and average something like 90% of capacity per season. Demand is high, so so are prices. Ohtani’s contract isn’t gonna change that – the fact that the Dodgers are one of the places to be seen in the most be-seen city in the world does.
Im aware. hence the question mark
This.
Just wait til we hear how much Taylor Swift made this year. It may start with a “1” & have 9 digits after it.
How about this: Nobody deserves to have $700 million for anything, but, provided we live in a world where people are going to have that kind of wealth, Ohtani still deserves it more than basically any other individual in the class of $700-million-havers. I always see people getting overheated about superstar athletes very occasionally becoming .1%ers and just think, like, have you seen the rest of those people? This is the only form in which the receipt of $700 million is even tangentially connected to performing actual labor. We can probably let the dude be (post-taxation, of course) at least until we take care of the existence of the rest of the $700-millionaires.
Another thought about professional athletes and income is that they are by far the most fairly taxed group of rich people, because there’s a less tax loopholes for earned income via salary than there are for capital gains and business expenses. They pay a lot more in taxes than people of similar income strata.
$70 million a year is a lot, but at least he’s doing a lot for that money. Texas A&M is paying Jimbo Fisher more than that to not be their football coach.
Just neighing.
Correction: A&M is paying a LOT for Jimbo to not coach. Are they paying anywhere close to $70MM a year for that privilege? NEIGH!!
Exactly this
What does need have to do with it? By your reasoning no one could earn more than a few hundred thousand dollars.
I mean I agree to the extent that no person needs to make this much money. But he is already going to pay over 50% in tax, and the money has to go somewhere. I’d much rather see minor leaguers get more money, some sort of base salary, and then raise the league minimum, and then provide better compensation once mlb players have retired but that seems unlikely.
I always hear these arguments but never a good solution. Everyone is always like “we need to pay teachers more, or fire fighters” or something. Sure I agree with raising the base for everyone. But you know who could be a teacher? Me, you, probably 70% of people who are born would be capable of becoming a teacher. Firefighter…I dunno, 40% of people. Doctors, who knows, maybe 5-10%. You know they call someone who finishes last in their class in med school? Doctor.
An international superstar athlete who both pitches and hits? One person in the entire world. There is nothing rarer than this. There is a family where all 3 kids were born on 2/29 (naturally) That is only 1 in 3.1 billion odds. When someone does something better than anyone else who has ever lived you should expect him to be compensated as such
The amount of turnover among young teachers would seem to indicate that the percentage of people who can make it for more than a few years, especially in the most intense work environments, is much lower than that 70% figure, but point broadly accepted.
Actually the number is waay lower than 70%. at least to be effective. Being a great teacher is harder than being an average doctor. We, as a society, just don’t care. So we hire less effective teachers just so we can pay them less and deal with all the after effects for generations.
I never said an effective teacher.
Teachers are paid less than other professions because their market is controlled by the government.
Being a great teacher is harder than being an average doctor.
Lol. No, it’s not.
Yes it is. Both are hard. Both can be thankless, hostile, and involve long hours working with people.
An average doctor is going to be shaped something like average clinical skills (for a doctor), frumpy or superior attitude (for a regular person), far above average anatomy and medicinal science knowledge (for a regular person), clocking in $300K a year, widely respected and admired. They have a great responsibility to do their job to the best of their ability as their decisions, actions, or lack of actions have life or death consequences, they’re a mandatory reporter and may have a duty to act even when off.
An average teacher will be shaped something like above average knowledge in a discipline or general education (for a teacher), fantastic ability to relate to others, intense passion for their job and the people they reach, incredible public speaking and empathy skills, teaching in a system that rewards attendance of 25 kids that don’t want to be there, but are responsible for shaping those children’s present and future behavior, social interaction, spelling, reading, writing, arithmetic, history, science, health, general education, more than the parents are for 9-months and/or perhaps more depending on the role, for $65K a year, and even if at the top of their profession, will have half the parents each year who project the poor behavior and upbringing on the teacher, widely considered one of the more thankless jobs a college educated person who “makes it” to their desired role can have. They’re a mandatory reporter who are responsible for the intelligence of our nation and expected to juggle a variety of students from different backgrounds and different skill levels and their performance is largely tied to improving standard performance tests for the purposes of increasing budget and feedback from the absolute most biased demographic imaginable, parents, while getting “Lol’d” by people like you discarding their profession as a joke.
To be great at that is not only harder, it’s more important, because they are going to be REAL difference makers for 1000 lives over the course of their career, impact 1000 children’s futures in every way, from their career and success to their morals and values. An average doctor and a great doctor have a much smaller gap both in terms of output and impact, mostly coming in the form of preventative diagnosis and proper medication administration uninfluenced by big pharma – which is very hard to do – and internet medical degrees, than the gap between an average teacher and a great teacher.
There’s also the fact that there is a lot less carrot to be a great teacher. There aren’t multiple chairs, heads of departments, adjunct professors, peer reviews, councils, speakers and endorsements available that increase earnings, and perception of success. Teachers can go from family medicine making $275K a year to Ortho and make $375K a year.
It’s one thing to disagree, that’s fine, I doubt anyone here flinches at that. But to be insultingly reductive and dismissive of the entire profession that shapes the future of our children is going to draw some well deserved eyerolls and commentary to the contrary.
There’s also an economic cause. A lot of that turnover is not on ability, but on effortfor salary against alternatives. If teaching paid better (and/or the school systems themselves were funded better to improve the work environment) turnover would go down.
There’s also an economic cause. A lot of that turnover is not on ability, per se, but on effort for salary against alternatives. If teaching paid better (and/or the school systems themselves were funded better to improve the work environment) turnover would go down.
I’d welcome the opportunity to see Random Joe try to run a halfway decent lesson in my classroom with no prior training.
If anything it isn’t higher pay that’s needed, it’s half the class sizes. But they can’t find enough of us to shrink the class sizes it seems.
The DMV has some of the best public school teacher salaries in the country, and some of the highest turnover, because at a certain point there’s no amount of money you can pay people to deal with students.
I think I’d have a much better chance at running a decent lesson in your classroom than making contact on an MLB pitch
Referencing the “average doctor vs great teacher” quote above, I’d also love the opportunity to see a random Joe try and perform a triple bypass surgery on someone
I would NOT like to see the average doctor try and perform a triple bypass surgery.
If a cardiothoracic surgeon with a team of specialist that work all day every day in a cath lab is your bar for “average doctor”, your understanding of healthcare in general is severely askew.
“…with no prior training” don’t forget!!
Being in education, I’ve seen a lot of people fail at teaching, including those who have been quite successful in the business world. Saying 70% could teach is like saying 70% could play baseball where they could hold a bat in the batter’s box and appear competent until the first pitch is thrown.
This argument always fails, because it erroneously places the blame on the player. The money is there. It’s going to the player or the owner. In that circumstance, I prefer the player get the fruits of their labor.
In a better world, this money would not be in baseball. Rather, it would be in more important endeavors that make life better for those who could benefit from it. Until that magical day arrives, the players deserve the money – and it’s not their fault.
There IS a better world.
It’s called “Germany.”
In this place, elite athletes get paid market value for their services, without a monopoly suppressing their salaries…AND they have incredible public transit.
And free-at-the-point-of-service healthcare.
Not getting into how they help the unemployed…but they also have an inappropriately massive surplus every year.
Remind me again which side Germany was on in WW2?
And how they have underfunded NATO over the last few decades.
complaining about NATO not getting enough funding in the comments of a baseball article is a great bit, looking forward to whatever else you come up with
Who brought up Germany’s public transportation in the first place?
Germany, if it were a US state, would be on par with Mississippi in terms of per-capita wealth.
What point are you trying to make here exactly? That Mississippi has plenty of oil money to offer top-of-the-healthcare and public transit?
People deserve to get paid what the market thinks they are worth, and multiple teams thought he was worth that much. Better that the players get some of the wealth than the teams pocketing all the wealth.
I assure you I could spend $700 million with little difficulty. You know how much Bezos’ yacht costs?
Haha alright Montgomery Brewster, good on you.
I’d argue that people with this mentality should never be in possession of $7 million, let alone $700 million, and there’s probably a reason why they aren’t and you never hear of anyone that actually earned their $700 million going broke, only those that inherit it or come by it from less than honest ways.
You sound like my wife. The Dodgers will recoup that $700M and then much more in a matter of years.
So he’s going to average more than at least a couple of teams payrolls.
Neat.
He will probably also draw more fans to a stadium by himself than said “couple of teams” in their entirety.
“Hoeny let’s go watch Ohtani hit! And pitch! And do amazing things!” > “Honey let’s go watch Joey Wendle!”
Don’t underestimate the importance of the universal DH in this, and that’s a pretty recent development. Do the Dodgers make this deal if he has to play the outfield to get his bat in the lineup?
I don’t doubt that he could since he is a great athlete, but it probably changes the math a little for an NL team.
He used to play RF in Japan.
With Betts slated for 2b the Dodgers have open spots in the OF.
He may not want to air it out early in the year but later? Odds are we’ll see him out there at some point.
Honestly people always act like pitchers don’t throw in between starts or something. He could easily play outfield 3 of 4 games between starts, but you think w the investment they won’t risk it. Who knows though. I’d bet he plays the outfield and first base, starting pitcher,and relief pitcher at some point in his career.
Did you miss the “this year” part?
He can’t pitch this year. Period.
Tommy John surgery.
That doesn’t mean he can only dh.
As for first base, Mr Freeman has dibs on that.
The OF *may* be an option later in the year as he starts to rebuild arm strength. Not enough to pitch but enough to hit the cutoff man.
I suspect that if he ends up having to quit starting he will convert into a right fielder
Miguel Vargas catching a stray…
The incompetence of Fanatics catching strays
I think it’d be interesting to a see breakdown of how the Dodgers set this up. Seems like they’ve been gearing up to make Shohei a handsome offer since LAST off-season, and it paid off
Crazy contract. Anaheim got his prime for $42.3 million.
And did nothing with it
That’s a bit unfair in that the Angels did try. Stuff like spending a zillion dollars on Rendon and getting nothing. As the Mets and Padres proved last year, you can work very hard and spend a lot of money on a baseball team and still not have success; putting together a winning team is not easy!
And there will always be a larger than most people seem to think element of random variance (“luck” has weird connotations for people) in whether or not it all works.
yeah not the Angels fault Trout got off the PEDs and fell apart as Ohtani came into his own
Impressive number. However, adjusting for inflation, Messi’s contract with Barcelona is larger. Approximately $826 million.
For 4 years of service.
Yeah but can Messi pitch?
Can Ohtani? Recovery from 2nd TJ surgery carries significant risk
Do we know if that’s actually getting paid?
True, but right or not, the public perception is hardly moved by this fact. That one has to fallback on soccer, the worlds most popular sport and internationally it’s not close, to “technically” beat his contract value is still blazing new trails for MLB. Nothing in North American major sports comes close.
You’re correct but this is still a big W for the players, union, agents, and fans. Both things are accurate and not mutually exclusive.
If the Dodgers can make it back in marketing/merch well then they can make it back.
From a purely baseball point of view, it’s a massive overpay.
You’re buying the guy’s 30s decade for effectively
–$30MM/year to DH
plus
–Gerrit Cole’s contract to pitch (9/324)
Is that worth it?
The DH bit, unlikely, but maybe. It’s possible he ages gracefully and it’s even possible he plays some OF. So probably not, but sure there’s a chance.
But are you really going to give Gerrit Cole’s contract to a guy coming off a second major elbow procedure (LA Times says second TJS) who has pitched enough innings to qualify for the ERA race exactly once? C’mon.
What is and isn’t a “baseball overpay” is largely a construct of the owners’ monopoly.
The Dodgers have played nice over the last couple offseasons…but the MLB system doesn’t actually obligate them to operate on the same valuation model as Tampa, any more than the Champions League mandated that Real Madrid spend as much as Leicester City a few years ago.
Not an overpay when the Dodgers have f-you money and they’ll make half of it back in jerseys etc.
Your justification doesn’t really hold for a true “massive overpay” if the Dodgers could instead choose to spend approximately the same total amount of money but do so with various modest overpays.
In other words, there are still degrees of efficiency vs. inefficiency even if the Dodgers commit to valuing WAR at above the going rate elsewhere in the baseball market.
Dunno.
Try this: who has the Dodgers TV rights for Japan?
This is the exact question I was wondering about. For some reason I thought somewhere in the past I read the MLB as a whole owns the international rights and not teams. This is a huge question in this. Seattle got the “Ichiro EFfect” in about 25-30,000 additional tourists from Japan coming to Seattle for games. I expect Ohtani brings more seats to Dodger stadium
I dunno how the TV market works over there so I just assumed Godzilla?
Having an extra 26 man roster spot matters once he’s back on the mound. I’m not sure how to quantify that as a dollar value, but it’s a big advantage to have an extra bench or bullpen spot.
Does he really give you an extra spot?
He spent long stretches not going every fifth game, but every sixth and sometimes seventh.
When Ohtani is in your rotation, you need a much better than average sixth starter (to be clear, relative to other teams’ sixth starters, not average pitchers). Because they will get more usage. A lot more.
It’s not just a baseball point of view. The value of instantly adding a generation of Japanese fans is huge. As an example, even during his last season, Ichiro still had multiple reporters travelling with him just to follow and report on him. Sure, Japan already had some Dodger fans for a lot of reasons, including Hideo Nomo, but this will add quite a few for a decade. I’d even wager that the opportunities for marketing, branding, and generational fans in Japan is something that money can’t normally buy.
Then there’s the potential he makes the Hall of Fame and wears a Dodgers cap on top of that.
As for the baseball point of view, the Dodgers roster is upgraded to the point where you have to overpay to have a clear upgrade. It’ll also be interesting to see if the Dodgers analytics and medical departments might be able to support his career even more.
A generation or two of Japanese ball players is going to grow up dreaming of playing for the Dodgers. I’m not sure how to price that, but I’m sure the Dodgers will benefit in the future because of this.
Shohei has thrown just under 1,050 IP to this point in his career.
Seems like a pretty good over/under for the next ten years.
That is essentially 150 IP times seven year.
¥101,404,800,000
The hundred billion yen man!
I think everyone is missing the most important piece of news that Michael put out there: you can still get great grits in Nashville.
Not still, they are better than ever. Better grain, better grind, better prep. Golden era!
DON’T TELL EVERYONE WE HAVE ENOUGH PEOPLE MOVING HERE AS IT IS… 😀
The discount rate in the article is smaller than today’s actual market discount rate. Figuring the NPV is hard when the market’s rate expectations are so divergent and variable. Arguably the most variability in our lifetime (30 yr discount rate moved by a % over a couple weeks recently).
The Dodgers placed one bet on Ohtani, another on baseball as a whole, and a third on the macro economy. I’m not a Dodgers fan, but I am a fan of big big bets, so I love this contract. There is nothing on the field or in merch that will determine the profit in this contract – all the creme for the dodgers will be macro economic.
I really would like to see more analysis of Ohtani as a player and what his on-field contributions would look like. ZiPS puts him at less than a 5-win player (combined pitcher and hitter) by the fourth year of this contract. And he starts the contract in his age 29 season.
I get the additional money he might bring in, but that’s not going to actually help them win games, which is kind of the whole point.
I wonder how much of that Fangraphs is positioned to do. So much of how it models players are based on comps, and Ohtani is probably the least comparable player a projection system has ever seen.
You could still do some interesting modeling backwards: “if this contract is fair on purely baseball terms, here is what it would look like”
Kinda makes it look like the Angels were never able to get anything in a trade with how much Ohtani was gunning to be paid.
An aside to the aside toward the bottom of the article: I keep reading journalists talking about Shohei’s relationship (or non-relationship) with media being a problem, but as a fan, I don’t think I’ve once felt shorted on Shohei content or connection to him as a player and person. It more often to me sounds like an expectation problem on the part of the media.
Way back in the day, journalists were able to find and write stories about people without even having access to them!
His approach to the media and lack of english speaking public appearances basically guarantees good PR forever
Yeah, I’ve seen media member imply that Shohei is being selfish. Then I remembered he went to an All Star game where pitched, DH’d and participated in the home run derby. Maybe Shohei isn’t very generous in giving reporters quotes but he seems very generous in sharing his talents on the field with the fans.
Shohei also had an awesome 4-minute long mini-movie for MLB the Show. Might be the only video game that I didn’t skip ahead every time I played it.
As far as pump up montages, it’s almost up there with ‘Eye of The Tiger’ in Rocky and ‘You’re the Best Around’ in Karate Kid.
If I was asked to compare Ohtani to another hitter, Corey Seager would not be my first choice.
Fair point, but legit question… who would be? Statistically, Gary Sheffield comes to mind…
I’d say something like David Ortiz (another lefty DH masher), with speed. But not only is Ohtani’s offensive profile not shaped like Seager’s, Seager is a SS. If Ohtani was Strider (a pretty good comp, when Ohtani is healthy) combined with Seager, he’d be worth even more.
Well yeah, being King of Gondor probably commands a decent salary
Also, Shohei is fast and valuable on the bases; Seager, despite being a SS, is slow as molasses.
Peak Shawn Green?
I’d speculate the drum beat for a new stadium starts soon anticipating Chavez will be condos sooner than later.
Hardly. Best stadium in the league still. There will never be a new stadium. They can make as much ancillary money as they choose to with the existing one. They could still build the condos though and have talked about it but Frank Mccourt still owns the parking lots and no project he’s associated with would ever get approved.
Lol at best stadium in the league still. The parking situation only refutes that. Just awful.
I wonder what Toronto offered.
780 million loonies, a condo in Hamilton, and a 55-gal drum of authentic maple syrup annually.
IF the reports are true that the Dodgers can expect $20-40M in annual marginal marketing revenue
And
IF the reports are true that the deferrals effectively make this a $600M deal
Then
All of the sudden I’m pretty comfortable with the price.
He basically got what I expected him to get before the elbow injury, with more deferrals (as a point of reference, Betts deferred around 115m of his 365m and MLB values his contract at 306m; if Ohtani is deferring a higher percentage, and additionally considering that the NPV is higher because interest rates are up (so your return on having the money today is higher), I can see how estimates below 600m make sense. It depends how far into the future he is deferring the money. Betts deferred 115m to be paid out in the 12 years following his contract. If Ohtani is in fact deferring ‘most’ of his salary, that means he’s deferring at least 350m of it – the payout period would probably also be longer than 10-12 years, and that would significantly reduce the NPV of the payments in year 20 or 25.
I’d love to see a business article about how that “marketing” money works.
You and me both. People love to throw “marketing” around, but it’s rarely if ever sourced, or with real numbers attached.
Me as well. And one that carefully takes into account details like the 48% local market revenue sharing pool to estimate incremental net revenue that the Dodgers get to keep.
surprised that the Dodgers didn’t spread the $700 million over 12 or 15 years. They could immediately drop the AAV to $47 million and even lower with deferrals.
I’m sure they would if Shohei went for that. Along with some small value Shohei could possibly extract for those years, there is also the painful song and dance players and teams often play when an aging player becomes worthless, and both play chicken on who will cut/retire first. If I were a player, I would not want to put that in the hands of the team. They could just keep throwing you out there to embarrass yourself.
Off-field earnings among MLB players in 2023
The gap is ridiculous.
Ohtani is a unicorn in more ways than one.
Being by far the most popular athlete in the most popular sport in Japan, one of four countries with a larger GDP than California, confers an unique advantage.
I saw so many Japanese ads watching Angels games.
The price for ads on Dodgers stadium just went up, deservedly so.
Ohtani the marketing machine may indeed be worth a lot of money in endorsements IF:
He can pitch 7-8 innings of 1 run baseball and get 10 strikeouts, AND hit 1 (or 2) HR’s the same game, AND steal a base, AND throw out a baserunner from the outfield now and then.
If Ohtani ends up being a DH, I don’t think he is a better hitter than an age matched JD Martinez.
I think the Dodgers front office is really smart, but this deal I do not think is a slam dunk. They will still end up having 1 player causing $70 million AAV for luxury tax purposes for the next 10 years. That will most likely result them paying penalties for years and as such, any money ‘saved’ in deffered salary will end up just paying the penalties and possibly handcuff them to adding more all star talent (unless they really do not care, ala the Mets). However if they really do not care, then why defer salary?
The salary deferrals lower the luxury tax hit below 70m per year. I’ve heard estimates ranging from 40-60m per year as the real tax hit. Final calculations will come after the K details are released.
That’s an incredible compliment. In his age 29 and 30 seasons, JD Martinez hit .319/.391/.655 with 88 HR and a 169 wRC+ that was 2nd in all of baseball. He was worth 9.2 wins those seasons even though he was worth -10 runs on the bases and -34.2 from DH penalty and being terrible when he did play the field.
Aaron Judge was 3rd with a 164 wRC+ those same two seasons. 4th were Altuve and Joey Votto with a 148 wRC+. Only Mike Trout, smack dab in the middle of his “Holy shit this guy looks like he is the best player that’s ever lived” prime, was better than JD Martinez.
I don’t think that comparison made the point that you were going for.
The CBT is a scam.
My first thought. I’m flummoxed as to why deferred money is A-OK, but MLB reportedly would’ve voided a 14/$400M for Judge that reduced the AAV’s percentage as much as Ohtani’s (on the low end of the deferral projection).
The deferred money is still a promise to pay an amount (converted to NPV) over the course of a number of years. Ohtani is getting paid the equivalent of $430m in today’s dollars to play for 10 years. It’s a true calculation of that value and over an honest amount of time that he will play.
Judge is not playing 14 more seasons. That would be ridiculous, so it makes no sense to use 14 as the denominator in the AAV calculation. That is manipulation to circumvent the rules in a way that simply deferring money is not.
The total value of the contract, accurately taking into account the NPV when deferrals are at play, divided by a honest commitment of years the player will play, is the right way to determine AAV for CBT purposes.
Seems like 6 of one and a half-dozen of the other. The end result and the purpose of either approach is to shrink the CBT hit, just that one is expressly allowed while the other isn’t. I don’t especially care one way or the other which way teams go about it, but this is a massive skirting of the CBT and makes me wonder why they even have it in the first place.
It’s a negotiated point of the CBA, not theocratic doctrine or the formulation of Enlightenment Age reason. Both sides have their interests, they’ve hashed out a compromise, part of that compromise is leaving some wiggle room in the accounting. Don’t know why so many people are suddenly acting like this is a moral hypocrisy.
I get that deferrals are nothing new (admittedly, I thought most hung around 1/3 of the contract value until someone posted the details of Scherzer’s Nationals contract) and perfectly valid according to the CBA. They’re starting to seem more like a bridge too far for me, especially considering a >95% gap between the salary and CBT in Shohei’s case. And why are deferred contract CBTs calculated using NPV, but a bog-standard 10/$300M with no deferrals takes a CBT hit of $30M for a decade instead? It’s baffling to me to have two different sets of contract rules.
While the value of a player outside of his performance on the field has been a factor in some of the deals that have been formulated, I think of what Judge and Harper bring to the Yankees and Phillies, nothing comes close to what Ohtani’s value is off the field. Baseball wise this is the all-time overpay and I would venture a guess that this is the first contract ever signed in which the players performance on the field was secondary in importance and his ancillary value is now the primary reason for the deal being consummated. I cannot even guess at the amount of money Ohtani’s mere presence on the roster brings in to the Dodgers. Does anyone here know what the the total amount of off field money is and what percentage of it is generated in Japan? I can only imagine that it is ginormous and how is it distributed in general and what do the Dodgers receive?
It’s an inexcusable error.
I can give you 20 million reasons why no one should trust the press.
Woah! Is this in reference to the 680 million deferred? Written a day before everyone else got the news?
Just checking in to note that since the Sunday Notes column launched this is the first time I can remember another FG story pushing it out of the top spot.
The rich get richer and the poor are candidates for being contracted. Tale as old as time.
In other news: chance of MLB contraction: 0.00000000%
Rest assured, if he had signed this same article with the Mets, we’d be reading a dozen articles about how Steve Cohen’s spending is bad for baseball…
Tbf there’d be dozen about how Cohen is a rebel owner, friend of the people, etc…Not to mention there’s no chance Cohen would be in after winning over the people last offseason by flashing a pittance …Also also Note how the narrative quickly became that Actually spending is Bad or Not Good or Not Ideal, same as it’ll be every single year the Dodgers fail to win a ring with Betts, Ohtani, and Freeman
It truly bugs me that we have to play pretend for our owners and keep calling a bajillion dollars over a gazillion years a bajillion dollars. Aren’t Americans dumb enough without this stuff?
means the Angels fan base will experience nothing but misery once Trout hits the IL in mid-May
So we need to rewrite the article completely now that we find out 680M, not say 400M, is deferred! This kind of looks bad for the people saying it was defensible contract at 70 per.
I’d certainly like to see what the present-value calculation looks like with the $68M/year deferred as reported today, and how it compares to a “normal” annual contract for $400-500M. It sounds increasingly like he got paid an amount of money in the rough neighborhood that we all thought he was going to get a month ago, but paid in an unusually Bonilla-like form and then wrapped in some extremely inaccurate initial reporting.
I’m reading $46M/yr in present value (e.g. on The Athletic), though my napkin math comes out to $36M.
2041.7539.7637.8636.0634.3432.7131.1529.6728.2626.91
In stark contrast to my username, I think the deferral has killed all my interest in following this league.
I’ll never get far down that road, but I went from Ohtani superfan to kind of hoping things don’t work out very well for him and his new team. I’ll wait a couple days to see what the experts say, but $2M annual salary feels like a gross manipulation of the market.
Can someone please explain why the MLBPA wouldn’t object to or protest this contract? Ohtani and his agent got taken for a ride. He’s the greatest player of all-time and he is being paid like any other superstar. This contract also hurts any 2-way player in the future, if we are lucky enough to see one.
The second largest contract in MLB history is Trout at 426.5M/12 (none deferred) for 35.5M/yr. The second highest AAV is
Judge at 360M/9 for AAV of 40M/yrScherzer, 43.3M/year, 130M total.If the reported estimate of $46M/yr CBT hit for 10 years and total $460M is accurate, then it’s not as stratospheric as originally reported, but even accounting for depreciation it’s still a record-setter in both categories.
Do I hate Shohei now?
The funny thing is that technically, Fangraphs crowdsourced estimate of $45M/10 years was very very off, but by the spirit of the exercise, it ended up being pretty on point.