It’s Only Money

Yesterday afternoon, just as most of Los Angeles was beginning to head to perhaps the last significant Happy Hour of 2023, the Los Angeles Dodgers held a press conference that was a far happier hour for them and, for the rest of major league baseball, a sobering reminder that there are haves and have-nots, and the Dodgers clearly are in the former category.

Shohei Ohtani officially donned Dodger blue, wearing his familiar number 17 in a new hue that is fast becoming the best-selling baseball jersey on at least two continents.  Owner Mark Waller made a rare public appearance, along with top executive Andrew Friedman, as Ohtani, who keeps an exceptionally low profile himself, did his best to say all the right things, including some compliments about his former employers 31 miles down I-5 and light years away in terms of baseball economics.

But as that press conference was unfolding, news also began to break that the Dodgers were absolutely not standing pat, as their management knows far too well that the virtual assurance they will make the post-season, a goal Ohtani failed to achieve during his six-year tenure in Anaheim, has mostly resulted in playoff despair with pitching staff woes, most evident during this year’s embarassing sweep by the 84-win Arizona Diamondbacks where one bad inning from three consecutive starters quickly undid all the good of the prior six months.  Since Ohtani will be unable to pitch in 2024 due to his recovery from late-season surgery, the Dodgers still have other needs.  And as CBS SPORTS’

Los Angeles has agreed to acquire right-hander Tyler Glasnow in a trade with the Tampa Bay Rays as long as he’ll sign an extension, CBS Sports HQ’s Jim Bowden has confirmed. Outfielder Manuel Margot and $4 million would also be heading to L.A., and right-hander Ryan Pepiot and outfielder Jonny Deluca are part of the return being sent to Tampa Bay. The deal is contingent on that extension; the negotiation window opened Thursday morning and could be done as early as Friday, according to ESPN.

Glasnow, 30, is a year away from free agency and is owed $25 million in 2024. Those terms limited his market to contenders, so it is no surprise then that the Dodgers could win the bidding. Glasnow certainly offers top of the rotation upside, though a lengthy injury history has prevented him from throwing a full MLB season. This year’s 120 innings are his career high in the big leagues, and if he were to make as many as 25 starts — meaning he was paid $1 million per outing — it would represent a new high for him as well.

There’s an awful lot of whining going on elsehwere in baseball about how in the wide, wide world of sports, on the heels of inking the most coveted free agent on the market to the richest contract in sports history, the Dodgers were also able to find a way to address the demands of a high-risk, high-reward starter.   Well, as ESPN’s Alden Gonzalez reminded earlier this week, when you’re owned by a billionaire who operates one of the world’s most successful hedge funds, you also have access to some world class creative accounting, and will attract those inclined to take advantage of it:

Ohtani’s historic contract with the Los Angeles Dodgers will see him defer $68 million of his annual $70 million salary, sources familiar with the deal said Monday, significantly lowering his new team’s payroll and potential tax burden.

The Dodgers announced Monday they had signed the two-time MVP, after Ohtani had agreed Saturday to a 10-year, $700 million contract, by far the richest in the history of North American professional sports. A source said then that the majority of the contract would come in deferred money; under this structure, however, Ohtani is deferring more than 97% of his earnings. The deferred money — totaling $680 million — will be paid to Ohtani between 2034 and 2043, a source said.

The deferrals were Ohtani’s idea, a source close to the situation said, motivated largely by the thought of helping the Dodgers sign other players and made easier by his massive off-the-field earnings.

And the Dodgers make plenty of money off the field themselves, and are in far better long-term shape than most other teams to know they’ll have it.  They are still in the early stages of a 25-year deal with Spectrum where the team will eventually net $8.35B for the rights to their games via their SportsNet LA channel, and earlier this year the channel secured a long-term deal with DirecTV, with whom under prior management they were unable to secure carriage with during its first few years, that will guarantee widespread availability at a time when a majority of other regional sports networks (including the local Bally’s outlet where Angels games are currently being telecast) are in death throes.

All the more reason to be dismissive about any wishful thinking from other teams that there’s a boatload of funds available to chase sought-after talent.  Save for teams like the Mets, Yankees and Red Sox who have established, successful regional sports networks where they have significant ownership stakes of their own in, that well is very much running dry.  It’s a major reason why the Yankees have Juan Soto, albeit on a one-year rental, as well as a contributing factor to why the Rays are parting ways with Glasnow.  Cubs fans, for example, need look no further than the colossal egg that their Marquee Sports Network offering has laid to be less optimistic about the likelihood of being able to write the kinds of checks that are needed to address their gaping holes.

Which is why I tend to agree with the slant that FAN NATION’s Matt Levine is offering up about the fate of another much sought-after talent, one with the same nationality as Ohtani:

One of the biggest names on the open market this winter is Japanese pitching sensation Yoshinobu Yamamoto.  It was reported that L.A. met with Yamamoto on Tuesday like he has been doing with interested finalists. He only has until January 4 to agree with a team due to posting rules.

MLB insider Jim Bowden of The Athletic is predicting that Yamamoto will land with the New York Yankees this winter. He has him getting a 9-year, $304 million contract. “Yamamoto is the most sought-after free agent remaining on the market. When the offseason began, it was believed he would get a contract in the $200 million to $220 million range, but now several front-office executives believe he will get closer to $300 million. Why such a big swing? It’s rare for a top-of-the-rotation starter to hit free agency at such a young age and it’s thought that the bidding war among teams, including many big-market clubs, will drive up the price.”

If the contract bidding goes up to $300 million, as has been discussed before, the Dodgers may not be in the running. Andrew Friedman hasn’t usually shelled out long term, high AAV contracts, and he already did that this offseason with Shohei Ohtani. However, Ohtani’s contract does have unprecedented deferrals within, freeing up more money for the Dodgers to spend. L.A. is very interested in Yamamoto, and he would be an absolute game-changer for their rotation.

Certainly, the allure of one of the premiere brands in the game, not to mention the presence of a top-performing slugger, will matter to Yamamoto’s camp.   To an extent.

But the money, especially the security of knowing it still wouldn’t break the bank, is the biggest carrot.  Don’t think for a nanosecond anything to the contrary.

And the Dodgers, thanks to Ohtani’s practical appeal to their beancounters, still have plenty of it to offer.  As well as hope to their fans more than willing to pony up biiiiiig bucks to watch all of this.  Already, opening day standing room tickets have been listed on StubHub at get-in-the-building prices starting at $431, with other standing room tickets priced as high as $889.  Wanna sit down in the Dugout Club?  Be prepared to spend ten times as much.

And do booknote the nights of June 21-22 and September 3-4.  Those would this year’s regular season Dodgers-Angels matchups, the latter being Ohtani’s return to Anaheim.  I have a hunch those ticket prices will be exponentially higher.

But hey, why not start saving now?  After all, it’s only money.  And it always will be.


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