MLB Teams Fear League Will Pick Winners and Losers in Tech
Music City has hosted plenty of major events over the years, but one of the most anticipated spectacles ever is about to hit Nashville: the Shohei Ohtani Sweepstakes.
MLB’s 2023 Winter Meetings (Sunday-Wednesday) will be held just a short walk away from the Grand Ole Opry, but baseball insiders and fans alike will be watching Ohtani, the two-way phenom who is by far the biggest prize in the MLB free-agent market this year — or perhaps any year.
This summer, projections for Ohtani’s next contract soared toward $600 million. But a season-ending arm injury suffered with the Los Angeles Angels will now keep him from pitching until 2025, and that has tempered enthusiasm. Nonetheless, his next contract is still expected to set MLB records for overall value and annual salary. It should also top the $503 million extension for Patrick Mahomes with the Kansas City Chiefs, establishing a new benchmark for the most lucrative player contract in North American pro team sports.
Unlike the protracted negotiation periods for several high-profile MLB free agents in recent years (such as Bryce Harper and Manny Machado), many teams and insiders look for Ohtani to make a quicker decision and agree to a new deal as soon as this week, as teams and agents gather at the sport’s top offseason event.
That timing, in turn, will influence the rest of the free-agent market and will allow teams across the league to continue more freely with their offseason roster development.
As a two-time MVP with perhaps the most unique skill set in baseball history — he’s both an elite power hitter and dominant starting pitcher — Ohtani’s allure is clear. He also happens to be a megawatt superstar with the league’s best-selling jersey.
But signing him would likely shackle a club to a top-tier payroll for nearly a decade, at a time when the link between player spending and on-field success is being inverted like never before. (See: the rise of the Baltimore Orioles and Tampa Bay Rays with bottom-five payrolls). The success of the high-payroll World Series-champion Texas Rangers was an outlier.
Another obvious caveat: MLB pitcher injuries remain problematic, and Ohtani had elbow surgery in September to repair a UCL tear.
So the stakes are high: signing Ohtani arguably carries more potential upside and downside than that of any other MLB free agent in history.
“He’s a great player. I know there’s going to be a lot of attention on [the chase for Ohtani], and I understand why,” Angels general manager Perry Minisian said at MLB’s GM meetings in November. “We’ll see how the offseason develops. We’ve got our plan, and we’re going to try and execute that plan and see where everything goes.”
Market Dynamics
The case for a record-setting deal is based in part on an expected surge in tickets, sponsorships, and national broadcast appearances for the team that signs Ohtani.
A recent study from Japanese economist Katsuhiro Miyamoto of Kansai University found that Ohtani’s economic impact during the 2022 season totaled $337 million across the U.S and Japan, factoring in the aforementioned revenue streams across both countries.
“These numbers are unprecedented for a single athlete,” Miyamoto said.
But there remains a clear dichotomy within the Ohtani Effect. The Angels’ 2.64 million attendance in 2023 is nearly 13% lower than its 3.02 million in 2017 — the year before Ohtani’s MLB arrival. Nine straight non-playoff seasons have dragged down interest in the team.
“Ohtani is far more prominent a figure on a national and international basis than he’s been locally to date,” David Carter, a University of Southern California professor and a longtime sports industry consultant, told Front Office Sports. “This is such a crowded market, definitely a results-oriented one, and the Angels never really broke through while Ohtani was there.”
The Sound Of Silence
Another key to the intrigue surrounding the sweepstakes lies in the negotiations themselves. Ohtani and his agent, CAA’s Nez Balelo, have been publicly silent throughout the process, to the point where they will hold it against teams that leak their meetings with Ohtani’s camp.
Balelo didn’t speak to reporters at the recent GM meetings; he even stayed at a hotel away from where the meetings were being held. Ohtani himself hasn’t spoken to reporters since early August and abruptly canceled a highly anticipated conference call last month, after he unanimously won the American League MVP, due to “circumstances out of his control.”
This isn’t new. Long before Ohtani became a free agent, he was typically quiet and reserved. Despite an endorsement portfolio valued at a minimum of $35 million annually, Ohtani remains highly measured in how and when he makes public appearances. Signing with another franchise will likely bring an entirely different level of attention and pressure from what he’s experienced thus far in the relative quiet of Anaheim.
“It’s a two-way street, and comes down in part to: What are the expectations of the [signing] franchise on Ohtani, and what are the expectations of Ohtani on that franchise?” Carter said.
Filling the silence, meanwhile, is a somewhat rare level of public stumping by current MLB players for Ohtani to join their respective teams.
“If you want to have a chance to win every single year and have fun doing it, Atlanta is the place for you,” Braves reliever Pierce Johnson said on MLB Radio. “I’ll keep working on my Japanese so I can talk to you and crack jokes, and we can go get all the sushi you want.”
Seattle catcher Cal Raleigh was another, pushing the lifestyle in the Pacific Northwest.
“When you get to what he’s going to make, does it really matter how many extra millions you’re making?,” Raleigh said on the “Marine Layer” podcast. “You want to be somewhere where you’re comfortable, somewhere where you know where the fans are going to love you, a place where you and your family can stay. That’d be the No. 1 sales pitch [from me].”
L.A. Story
The Los Angeles Dodgers have long been seen as a frontrunner to land Ohtani.They have the top betting odds to sign him, with an implied probability of 40% of signing him, and it’s not hard to understand why.
Ohtani is already familiar with the L.A. market, and the Dodgers enjoy some inherent resource advantages thanks to their perennial status as MLB’s attendance leader, their 25-year, $8.35 billion local media rights deal with Spectrum, and their storied history as seven-time World Series champions.
Such a move would further codify local-market sentiment, in which the Dodgers already enjoy a massive advantage in popularity over the Angels.
Beyond the lack of a playoff appearance since 2014, which ties Detroit for the league’s longest active postseason drought, the Angels have been continually beset with front-office and stadium issues under owner Arte Moreno. The team has also employed four different GMs since 2011, it just hired its fifth field manager over that time frame, and it has cultivated a reputation for organizational instability.
“It will be fascinating if Ohtani just moves up the freeway [to the Dodgers],” Carter said. “It would be sort of a nail in the marketing coffin for the Angels.”
Whether or not Ohtani’s free agency gets a Hollywood ending, this show will still be a must-watch.
