Ohtani signs with the … Angels? photo via theatlantic.com
We now know that Japanese superstar Shohei Ohtani has signed; he’s going to the Los Angeles Angels … or in other words, the other baseball team in Los Angeles. His selection of that team seems to have been driven by a desire to be on the West Coast, his apparent desire to be on an AL team to open up the DH opportunities in-between his starts … and his insane desire to leave literally tens of millions of dollars on the table.
I was listening to a podcast where some guy was trying to argue that Ohtani was actually making a “good” business move by coming over now. I was flabbergasted. The guy’s main argument was that by coming over now, he gets to free agency two years earlier and thus can get more money then. But it gave zero credence to the fact that he’s going to be costing himself literally tens of millions of dollars by playing for MLB min salaries for three years.
I thought i’d try to map out just how ridiculously bad his financial decision was to leave Japan now versus in two years, when he’d be 25 and would be an unrestricted FA. So, using some simple guesses and projections, here’s an attempt to discuss just how much money he’s leaving on the table.
By coming over now, he is subjecting himself to the same rules as any other IFA; he gets the maximum bonus that the Angels can offer ($2.315M after they acquired some bonus money just ahead of the signing). He’ll play for the MLB minimum the next three years. Then he’ll enter arbitration, with the caveat that any shenanigans in the contracts he may sign to buy out arb years will probably be voided by MLB. So we’ll use the records for 1st/2nd/3rd year eligible arb players as benchmarks.
By year:
- 2017: $2.315M bonus
- Age 23-25 seasons: 2018, 2019, 2020: MLB minuimums or there abouts; lets assume he gets good raises and earns $545k, $800k and then $1.1M (Mike Trout owns the current record for pre-arb player salary of $1M).
- Age 26 season in 2021: 1st arb year; $10M, which is Ryan Howard‘s current record for first year arb eligible players … and which is significantly higher than the 1st year record for pitchers (Dallas Keuchel‘s $7.25M).
- Age 27 season in 2022: 2nd arb year: $11.3M
- Age 28 season in 2023: 3rd arb year: $15.5M
- Age 29 season in 2024: 4th arb year (why does he get a 4th year? Because what’s stopping the Angels from keeping him in Spring Training until a few weeks have passed and keeping him for an extra year? Wouldn’t you?): $19.75M.
So, adding that up; assuming he matches the absolute highest figures in arb figures and doesn’t sign an extension, he’d earn $61.31M in bonus and salary by the time he’s reached Free Agency.
Versus ….
- 2018: plays in Japan at his current salary of about $2.378M
- 2019: does the same.
And in 2020, he comes over here completely unencumbered and signs a massive deal. The pundits that i’ve read, when asked what he’d be worth on the open market right now, say between $200M and $240M in total value. Their argument would be that he’d easily be the best FA on the market, he’s got better stuff than any pitcher out there (he sits upper 90s, touches triple digits and per Dave Cameron of fangraphs has spin rates the equivalent of Luis Severino … all while producing at the plate and being an 80 runner). $200-$250M is a crazy contract to try to project to … so lets assume, for the sake of argument, its a $25M AAV deal (which is probably light, but makes the point anyway). To then cover the same years as the above scenario:
- 2020, 2021,2022, 2023,2024 at $25M/per.
So that’d be $125M plus his two years of Japan salary. That’s a difference of about $65M just between now and 2024 … and that assumes several key points (that he gets the arbitration record each year, that he continues to get his ridiculously cheap $2.3M Japanese salary, and that he “only” gets $25M AAV).
Odds are that the actual difference would be much higher, since he’s likely to get a lot more than $25M AAV. Why? Because unlike typical Pitcher FAs we see in the majors … he’s still in his early 20s, he’s got no injury history … and he can hit! So if you think he’s likely to get closer to $35M AAV … then add another $50M to that $65M gap above and now you see why people are saying he’s making a $100M mistake.
Yes, Ohtani will be making bank through endorsements. So he’s not going to be hurting for cash. But the life of a pro athlete can be fleeting; you get as much as you can, as soon as you can, because there’s no guarantees about what happens tomorrow. Ohtani might blow out his elbow twice in four years and he’s out of the league before he even hits free agency. Or he might turn into the next Roger Clemens. He’s making a huge gamble though in order to “compete” against the best now versus in a couple years.
(I think I got the above scenario right … let me know if there’s some detail of his contract that I missed).
In the US, it’s all about the money. But there are other things in life, and maybe Ohtani appreciates that better because he grew up elsewhere.
I think the analysis is spot-on, but maybe the general obsession over finances is missing the point: Ohtani wants to play in the best league in the world asap, and a few million of dollars are trivial when compared to that goal.
JC
12 Dec 17 at 11:30 am
JC: i’d agree with you if the amount was just a “few million dollars.” But it isn’t. Its probably close to 9 figures when all is said and done. And to me that’s just foolish.
This isn’t quite the same as a player taking 10% less on a contract to play where he wants, or giving out a “home team discount.”
Maybe his thought is really something along the lines of, “i’m going to make serious bank in endorsements so who cares how much ‘salary’ i get from my team.” Maybe he’s one of those rare people who thinks that enough is enough, that whether he has $1M or $100M in the bank he’s got enough. Certainly I get the impression that successful PGA golfers feel this way after a while (as an example). Or perhaps as others have noted he’s all about the competition and couldn’t care less about the money. I find this last point the least credible. Everyone is motivated by money to some extent or another.
Todd Boss
12 Dec 17 at 11:57 am
I have heard there is an expectation of endorsements, mostly in Japan, totaling perhaps close to $20M annually. That’s his offset right there. Of course endorsement contracts can be cancelled if he gets hurt, while MLB contracts can’t. However, if he had been injured in Japan before making the leap and getting at least a couple of rounds of $20M endorsements . . .
Add that to the news that he’s already had a platelet injection in his elbow . . .
I do wish him well, though. It’s a good story. I’m skeptical whether he’s going to amount to much as a hitter, but we’ll see.
KW
12 Dec 17 at 1:36 pm
Off topic, but Fangraphs’ prospect guy said this in his chat today:
Cash Man
1:17
Does trading for Stanton hurt the NYY chances of signing Bryce Harper in 2019?
Eric A Longenhagen
1:17
People in baseball think Harper stays in DC
Interesting…
Derek
12 Dec 17 at 1:41 pm
KW: the scouts i’ve heard decent evaluations from seem to indicate that Ohtani’s bat plays very well in japan … but they project him to have some issues coming here. Mostly due to the length of his swing playing well against the slower velocity/more emphasis on off-speed stuff in japan versus the higher velocity emphasis in the US that should result in “holes” in his swing on the inner half/upper half. Now … that’s where he is NOW; every hitter comes up with some holes they need to address. Can he make the adjustment with coaching and reps? I dunno; that’s the hard part. Switch hitters talk about how difficult it is to maintain both swings … well he’s a hitter AND a pitcher. MLB pitchers have a hard enough time just maintaining their mechanics and everything that goes with being a pitcher … now he’s gonna try to do both? That’s the hard part.
Nonetheless … I still wou ld have loved to have had him. From a team perspective he’s such a ridiculous bargain even if he washes out; $20M posting fee, a couple million of a bonus and a MLB min salary is less than two years of a replacement level veteran pitcher.
Todd Boss
12 Dec 17 at 3:05 pm
Derek: Wow, Harper stays in DC eh? Keep the band together. Why not?
Todd Boss
12 Dec 17 at 3:05 pm
Multiple reports are that his physical was leaked and he has a torn UCL.
So maybe he took what he could get, knowing he was damaged goods?
ckstevenson
13 Dec 17 at 12:10 pm
That’s pretty much my point on Ohtani. I wonder whether he can still hit while he recovers.
On Harper: I’ve been saying for a while now that the market for his services, at the price they’ll cost, isn’t that big. It just got smaller. It’s not just that the Yankees are now out of the market. Look at the tepid offer the Dodgers made while also insisting that the Fish pay a chunk of the contract. I don’t think Friedman has access to the unlimited resources that everyone thinks he does, although that may change as some of their dead-money contracts come off the books. But there was a lot of talk last offseason that the Dodgers weren’t going to come up with the scratch to re-sign both Jansen and J. Turner. They did, but with hometown discounts.
Bryce to the Cubbies? Maybe, but the Cubbies are going to have their young stars into arb and contracts by that time, plus they’ll still be paying big chunks to Heyward and Lester. And until Theo finds more pitching, they’re not really going to be championship contenders.
Who else is there? Angels? Their free-spending days seem to be over, and they certainly got burned by the big, long deals for Pujols and Hamilton. Giants? They’re begging for stars these days, but guys seem to see them as the smoking 64-win wreck that they are.
Phillies? There’s been ongoing buzz that the Phils will have all this money available to throw at free agents. But they suck! Who would want to go there? Who would want to take the abuse from their awful fans?
Another factor here is that Bryce was/is close with Desi, who was one of the groomsmen in his wedding party. Desi isn’t the player that Bryce is, of course, but his free-agent experience hasn’t been a healthy one, and he had to leave a city where he was heavily invested to chase it.
Anyway, where’s the REAL market? I’m not totally writing off the Dodgers, but right now, they seem more interested in building with young talent than chasing big-money targets. I think the Cub rumor is built more on the what-if of getting the Vegas boys together than it is any real need by the club to invest that heavily.
All of this to say that as things stand right now, Bryce and Scotty might to well to a little more intently if Rizzo and Uncle Ted put something on the table.
KW
13 Dec 17 at 1:03 pm
Man, reliever salaries are shooting through the roof. $7-9m AAVs are commonplace now. I am usually in favor of the players getting more of the pie, but not sure I think this is money well spent.
Boras confirmed that he’s had extension talks on harp. I think he means more to the Nats than other teams, so there is a chance. Not sure I can get behind a $400m extension, though.
Ah hell, I’m getting to old for this. Maybe I should start going to minor league games.
Wally
13 Dec 17 at 1:27 pm
Can’t beat Dollar Mondays at Potomac, particularly if Soto and Kieboom are there in 2018.
Yes, with the salaries even for middle relievers, I think the Nats are going to HAVE to go over the luxury tax line this year. I just don’t think they can fill out the roster at the caliber they want if they don’t.
Nats said to be poking around with Avila to split time at catcher, which I’ve been advocating for a while. Also said to be poking around with Wade Davis, which would seem to be a pricey piece for a “nice to have.” I would think the floor for him would be Melancon’s 4/$60M. Mad/Doo/Wade sure would be a heck of a back end, though.
KW
13 Dec 17 at 2:00 pm
Ozuna has left the division. I assume Yelich will be soon to follow. He’s controlled for five years and therefore more valuable.
KW
13 Dec 17 at 2:53 pm
I didn’t read it as his physical was leaked, nor that he has a “torn UCL.” I read it as UCL sprain. grade 1. definitely not as bad as a full tear, which would be immediate TJ. And I read it as being freely Disclosed with the medicals to all 30 teams. Still didn’t stop nearly all of them committing to the $20M posting fee.
Todd Boss
13 Dec 17 at 4:14 pm
And Smith is off the board to Astros.
Call me underwhelmed with Miami’s take for these rebuilds. We should make a move for Realmuto after all. I don’t think the cost will be prohibitive
Wally
13 Dec 17 at 6:43 pm
Wally, you may be right. I’d be very interested in Realmuto if he didn’t cost someone from Robles/Soto/Kieboom/Fedde/Romero. Severino + Marmolejos for Realmuto doesn’t sound like much, but considering how little the Fish have been getting back in their other dumps, maybe they’d consider it. Maybe the Nats also throw in one of the 2017-draftee pitchers?
KW
13 Dec 17 at 7:33 pm
Kintzler back, at what is reportedly 2/$10M plus some sort of vesting option for a third year.
I’m conflicted on this one. I didn’t think Kintzler was that great, particularly according to advanced stats, but I also thought he’d get a lot better deal than this with his 29 saves. Considering how much some of the other relievers were getting, though, this is a really good price.
Is this the only bullpen move the Nats make? I had seen something by Chelsea or Jorge that didn’t think they were interested in bringing Albers back. Let’s see, they’ve got Doolittle, Madson, Kintzler, Romero, Glover, Kelley, Solis, Grace, and Cole. That’s nine guys for seven slots, and Grace, Cole, Solis, and Romero are out of options. Look for a trade or two moving a couple of those guys. There’s really no place for all of them . . . at least if Glover and Kelley are healthy. (But if Glover and Kelley are truly healthy, did they really need Kintzler?)
KW
14 Dec 17 at 5:34 am
If the $10m is right, that’s a relative steal in today’s market. Plus, I like Kintzler. He is a strike throwing Treinen, and the 7th inning is perfect for him. I would have matched the Joe Smith deal (2/$14m) but otherwise can’t see a reliever deal I’ve liked.
I’d go Fedde, Severino + some A ball pitcher like Baez for Realmuto. I do think it takes an SP prospect like Fedde to get him, but i’d Have no problem doing that for 3 years of Realmuto.
Still feeling like that was surprisingly positive rhetoric between Boras and Rizzo on a Harp extension.
Wally
14 Dec 17 at 6:58 am
To me, Realmuto isn’t worth giving up Fedde. Some others may think differently. I would gladly including Cole and/or Grace, though, and I’d trade Baez or Jefry Rodriguez in a heartbeat.
KW
14 Dec 17 at 11:09 am
Yelich, Realmuto, and Prado for Taylor, Fedde, Cole, Grace, Severino, and Suero. Who says no? Nats get Yelich and Realmuto without giving up one of their big three prospects because they take on Prado’s contract. Prado is only one season removed from hitting .305, and he’s got a lot of defensive versatility.
On a lesser scale, the Nats might be able to get a better deal on Realmuto if they’re willing to take Prado as well.
I think the Nats will have to trade Cole and Grace at some point. They’re out of options and don’t figure in the top seven arms for the bullpen.
KW
15 Dec 17 at 7:07 am
KW _ Would love that trade – go big or go out in first round again. Nats need to find a way to strengthen their 2 likely weaknesses this year (catcher, CF – MAT is still K machine). They can plug hole in 5th starter with re-treads – like they did in 2H last year. They are a near lock for division title – they need a line up to put them over the top in playoffs – top to bottom strength if such a trade gets made. I know, pipe dream – but who knows with the way the fish are shedding players and salary. And agree, Prado actually helps versatility and bench (especially with Murph starting slow).
Gus
15 Dec 17 at 8:20 am
I can’t imagine even the Jeter- led Marlins take that deal. They could get boatloads of talent for Yelich and realmuto if they don’t try to lose Prado’s salary too. At some point they have to go that route.
What about Kieboom, Crowe and JRod for Realmuto?
Wally
15 Dec 17 at 8:55 am
Well, I’d give them Spencer Kieboom, but not Carter. They’re not getting any of our big three for what they’ve got left. And I do think they’d take a deep discount in the return in exchange for dumping Prado’s salary. Prado has to go. But they’re going to have to give up someone else of actual value to get a team to take him.
KW
15 Dec 17 at 12:09 pm
Very curious to read how many relievers the Nats have continued to contact even after signing Kintzler, including Rondon. They still seem to be pushing for Wade Davis . . . which would guarantee that they go over the luxury tax. I’m not against more bullpen bolstering, but I’m a little surprised that they see yet another arm as such a big need. Makes me wonder what they think about Kelley’s and Glover’s health.
Frankly, I see another starting pitcher and another catcher as bigger needs than another reliever.
Also curious to see Santana going to the Phils. It doesn’t scare me, unless he is also a starting pitcher in disguise, and can start at least three days a week. Otherwise, they’re still going to push at least 90 losses.
KW
15 Dec 17 at 5:24 pm
I haven’t seen anyone write the definitive article on the subject yet — although it’s possible that someone has — but I think we’re seeing a fundamental shift in MLB roster construction. The change has been coming for several years, dating at least to the Royals’ deep bullpen usage in ’14 and ’15, but this offseason seems to be the culminating tipping point of the shift of emphasis from starters to bullpen.
Admittedly, part of what may be driving it is that all of the starters at the top of the market have some serious flaws. But the price for elite starters has moved beyond what most teams can pay, or at least wish to pay.
This isn’t a closer-driven market, either, like it was both at the ’16 trade deadline and following offseason. There’s only one elite closer on the market this year, Wade Davis, and teams don’t seem to be rushing to pay him “elite” money. Part of that is proper wariness of some injury history, but part may be a cultural shift to more of the by-committee approach.
For those wondering whether we’re entering the era of the five-to-six inning starter, I think we’re getting our definitive answer. Gio was just a little bit ahead of his time!
KW
16 Dec 17 at 7:46 am
This could just be another way that all this television money is being distributed to the players. I think inflating the ‘normal player’ salaries is probably better than increasing the superstars anyway. If you think about average payrolls now ($120mish?) it feels like it has gone up quite a bit in the last 5 years.
Was glad to hear Rizzo say he is still talking to Lind and esp. Kendrick. Those guys could really solidify the team.
Wally
17 Dec 17 at 7:57 am
I’ve been reading some of the reports on Winterfest over at TalkNats. One comment sticks in my craw: Martinez saying Adam Lind was the one guy that the Cubs really didn’t want to face. Made me aggravated (about the Nats) for the first time in a few months. I think the only thing I said I wanted Dusty to do was start Lind against lefties. But whatever, he’s gone.
Wally
17 Dec 17 at 11:08 am
Err …. make that righties.
Wally
17 Dec 17 at 12:13 pm
No need to apologize, as Lind hit both lefties and righties much better than Werth did. He might have been at risk of losing a ball in the lights, though. Oh, wait . . .
I keep thinking the Nats will make at least one big move this offseason, but I don’t know what or when. They’ve added at least one significant player every offseason dating back to Werth. Unless they’re truly trying to stay under the luxury tax, this would seem to be an offseason for them to make an all-in kind of move.
KW
17 Dec 17 at 2:18 pm
Just catching up on the Winterfest chatter at Nats Talk. I see that Rizzo confirmed that the Nats did in fact stay under the the luxury tax in 2017, which is huge news since the penalties would be less if they go over in 2018. Also, Chelsea Janes is reporting that Rendon said that he’s told Boras that he’d be interested in staying the with Nats. If Bryce leaves, it really could/would be Rendon’s team.
KW
17 Dec 17 at 2:44 pm
Even more important to my thinking is that their compensation for losing Harp, Murph and maybe Gio next year won’t get knocked as much either.
I’d love to extend Rendon. It seems like there is a good chance too.
I don’t see the big FA signing; payroll is high already and no one screams out as a compelling buy. Now a trade for Archer or Cole might happen. Gonna cost Robles or Soto though. Tough one
Wally
17 Dec 17 at 4:51 pm
Also, it looks like the Phillies are upping their game. I don’t see them as contending this year, but they’ll be close. Wouldn’t surprise me to see them add Arrieta. A.500 record is a real possibility.
Wally
17 Dec 17 at 7:02 pm
At least the Phillies seem to be trying, for the first time in five years or so. I don’t think Santana makes a lot of sense for them, though. They could have gotten two or three other players for the scratch they’re giving him, guys who actually play positions that they need to fill! The reliever signings make sense, as those guys give you a chance if your starters keep it close, plus you can flip them for prospects at the trade deadline.
Everyone seems to think that the Phils are trying to become semi-viable so they can lure free agents next year. Maybe, but I wouldn’t hold my breath on that actually working.
But at least they Phils are trying. What the Marlins are doing is a disgrace to the game. And am I the only one who thinks that the Dodger salary dump deal with the Braves, less than a month after a former Dodger employee became their GM, is more than a little shady?
KW
18 Dec 17 at 9:23 am
Nats and luxury tax: there is a path for the Nats to stay under the tax line this year, but it’s a narrow one. I had seen estimates of the Nats having something like $17-25M to play with this offseason to stay under the line. Kintzler counts $5M for 2018, so $12-20M left.
The most expensive item left on the shopping list is a fifth starter. The Nats also need another catcher and a couple of bench bats. They don’t really have an easy way to free up cash . . . unless the Braves would take a Wieters dump! (Hey, he’s an ATL native, although we don’t want to piss off Boras until we get that Rendon extension done.) They could clear a little over $1M by moving a couple of the bullpen guys who are out of options, like Cole and Grace, but that’s about it. They’re NOT moving Gio, people.
Anyway, if they’ve got closer to $20M left, that would give them $10M for a starter, $5M for a catcher like Avila, and $2.5M apiece for two bench bats. That could be done. None of the acquisitions would be exciting, but it could be done.
KW
18 Dec 17 at 9:34 am
I didn’t think the Dodgers salary dump was shady deal. Seems to make perfect sense for the Braves. they pay the same amount of money but get a utility infielder +2 potential pitching options. And make room for Acuna.
If the Nats have $20m left to spend, I take half of that and bring back Kendrick and lind. they can spend the rest on whatever they want
Wally
18 Dec 17 at 12:52 pm
Rumors had the Mets pursuing Lind, but now the fabulous AGone seems to be the Big Apple of their eye.
I’ve said all along that Lind was going to find tough sledding in the 1B/DH market. With the Bosox settling for Moreland yesterday, that closed another potential door for some bigger names like Hosmer.
All I know is that there are still a heck of a lot of good free agents out there, and when the calendar turns to 2018 in less than two weeks, they and their agents are going to start to get desperate. There are going to be some bargains to be had, Lind and Kendrick perhaps among them. Kendrick could be particularly useful to the Nats if Murph isn’t going to be ready by the start of the season.
KW
19 Dec 17 at 9:15 am