About a month ago I profiled Japanese ace Masahiro Tanaka and the history of Japanese pitchers in MLB, which is sketchy at best. Many pitchers look like aces in Japan, get paid a ton of money, and turn out to be nearly valueless. Or completely valueless.
Tanaka doesn’t look like one of those pitchers, but he also may not get posted now. This morning, MLB and Nippon Professional Baseball agreed on a new posting system, under which the maximum bid for a player is $20 million. Any teams that submit the maximum bid (whether it’s $20 million or not) will have the right to negotiate with the player.
This has two effects: it’s going to give a lot (a lot) more money to Japanese pitchers, and a lot less money to NPB teams. Both Daisuke Matsuzaka and Yu Darvish commanded posting fees in excess of $50 million, and even Kei Igawa got to $26 million. Under the new rules, all of the teams bidding on those players would have a lot more money to spend on the contract instead of the posting fee.
More importantly, the new system will give the player options and actually introduce bidding, which will further drive the price. Formerly, superstars faced pressure from both sides to agree come to MLB, with the NPB team wanting to cash in their star for a massive payday (they only collect the posting fee if the player is signed) and the MLB team looking for cheap, young star.
Now the player will be driving his own price, with the ability to not only command a larger share of the total cost, but ensure they get the best possible contract. Darvish ended up costing around $110 million for the Rangers; if Tanaka gets a similar total commitment, he’ll see a contract in the $90 million range instead of Darvish’s $60 million.
With more teams able to bid up the figure, though, Tanaka should end up exceeding Darvish’s total commitment, and could easily get a seven or eight-year deal in the $150 million range, essentially the contract the Yankees just gave to Jacoby Ellsbury. MLB teams have to balance the risk of signing a Japanese player with no MLB experience against the reward of getting him when he’s still young enough for a long-term deal not to turn sour by the end (Tanaka’s just 25 in 2014).
Clearly MLB intended to lower the cost of acquiring Japanese players with this move, and they may or may not have done that. With the lowered posting fee but more open bidding, it seems most likely that the best they’ve done is shift cash from the posting fee (NPB team) to the contract (player). That’s likely a fairer distribution of resources, but it could come at a cost for some clubs.
The Yankees current sit at around $170 in estimated payroll for the 2014 season. If they want to stay under the $189 million luxury tax and away from the massive payments they’d have to make if they don’t, they may no longer be in the race for Tanaka. If his total cost was $120 million, and half of that went to a six-year, $60 million contract, it would be easy to see New York filling one of its rotation holes with Tanaka, as he would only put $10 million towards their 2014 payroll.