FREE AGENCY HAS BECOME A LOSING GAME FOR VETERAN BALLPLAYERS
THE DISRUPTION that analytics brought to the baseball diamond has hit a more sensitive target: players' wallets, especially those belonging to anybody on the wrong side of 30. After their winter of discontent last year, when what little money did flow into free agency flowed late, players face a critical market this year when it comes to labor relations. On one hand young stars Bryce Harper of the Nationals (right) and Manny Machado of the Dodgers could restore the glamour and riches of free agency. On the other hand data-driven front offices, with a cold, informed eye on how baseball has become a younger man's game, have squelched emotional buying decisions that once drove the market.
Frustrated agents started rattling sabers last winter. Union executive director Tony Clark filed grievances claiming that four teams—the A's, Marlins, Pirates and Rays—were not spending enough of their revenue-sharing funds on players. The union's meeting with Oakland executives this summer about the grievance was awkward; at the time the A's had the fourth-best record in baseball and were positioned for a postseason berth.
"The biggest problem is the way the union and the agents value players, as opposed to the way teams do," says a high-ranking executive at one team. "The union and the agents are stuck in the past. They were used to players being paid based on their service time and things like RBIs. That's not the way clubs are valuing players anymore. If there's one thing I'd tell the agents, it would be, 'Your system is outdated.' The fact that a [low-payroll] team like Oakland competes is proof."
Baseball agents and union officials were raised in an era when free agency was the land of milk and honey. "It was like trying to hustle a girl in a bar," was how Reggie Jackson described Yankees owner George Steinbrenner's wooing him in 1976. Such traditions held as recently as 2014, when a crew of Giants executives, with catcher Buster Posey in tow, rang the doorbell of free-agent pitcher Jon Lester at his Georgia home soon after San Francisco won its third World Series in five years. The Cubs eventually won the Lester recruiting war with $155 million over six years. In November 2015 players luxuriated in knowing that getting to free agency meant getting to the end of the rainbow. Owners spent $2.5 billion on free agents that winter—32% more than in any other offseason spree.
Teams generally skipped the wining-and-dining last winter, choosing to slow-play the market. No player had ever signed a $100 million contract after January, but three did in the slow-mo market: Yu Darvish (Cubs), Eric Hosmer (Padres) and J.D. Martinez (Red Sox).
The CBA is structured to reward older players, but the current decision-makers have devalued age. The median age of a player when he breaks into the big leagues is 24. He cannot be a free agent until after six years of service, which means he is past the prime age of 27 or 28 and can be as old as 31 when he hits free agency, if the club is strategic with his service time. Many players never even gets there; the average MLB career is 5.6 years.
"It hit me one day years ago," said one club vice president. "The insurance company that underwrote contracts told us, 'We can no longer underwrite any pitcher beyond three years.' It stopped me. This is their job to know these things. So why are we doing something different? Here's what happened: All of us in this business became actuaries. We are nothing but actuaries now."
Numbers tell the actuaries not to count on older players to be stars. Just four years ago 43% of all players with a 3.0 WAR or better were 30 or older. Today that percentage is down to 19%. The actual number of thirtysomething stars dropped from 32 to nine.
Baseball is getting younger not only because younger players are cheaper but also because advances in training and more intense amateur schedules shorten the learning curve. The three seasons with the most home runs by players 25 and under all have occurred in the past three years—or since the last CBA was signed. Also, velocity on the mound and speed on the bases and in the field are skills that decline with age, and those attributes are not only in demand but are also measurable in today's game.
In the last CBA the players obtained wins on "quality of life" issues such as more days off, less rigorous travel, chefs and sleep rooms in clubhouses, and extra seats on spring training buses, as well as the defeat of a proposed international draft (though the maneuvers now to institute one, such as dealing with government agencies, international federations and customs, are so onerous as to make that win a Pyrrhic one).
Free-agent money flowed so freely at the time that economic issues didn't drive the bargaining. The union obtained relatively minor increases in minimum salaries and Competitive Balance Tax thresholds. The union could not predict how the coming reevaluation of player value would so quickly change the economics of the game. More than half of the GMs today (17) have been hired since 2015.
The union will have to find a way to get players more money at the front of their careers. Teams traditionally paid free agents based on what they had done; now they pay based on how they will age through their 30s. Harper and Machado are outliers because they are the rare cases in which the prime years of a star player are available to every club. Those free agents over 30, however, should brace for another long, cold winter, thanks in part to the failures of many free agents from the last market to perform well. Teams will be wary of a number of big-name free agents (above). These are tense days for players. In a time of record revenues—the sport generates more than $10 billion—their view of free agency as a reward has been upended. They point to precedent as support for megadeals, but front offices point to those same precedents as proof to stay away from them.
Analytics gone mainstream have changed the game drastically. Baseball has become a boom-or-bust game with its subtleties sanded away by the quest for power on both offense and defense—a battle of home runs vs. strikeouts. Analytics have changed the game off the field as well, and for players over 30, it's a game they are losing.
THIS OFFSEASON TEAMS WILL BE WARY OF SIGNING THESE BIG-NAME FREE AGENTS OVER 30
3B, Cleveland Indians
The 2015 AL MVP, who's spent most of the year on the DL, might have cost himself $100 million by ending contract talks with Toronto last winter.
OF, Baltimore Orioles
The longtime face of the O's will struggle to get more than Jay Bruce, who signed for three years and $39 million with the Mets in January.
SP, Los Angeles Dodgers
If he opts out of his contract, the three-time Cy Young winner, coming off three straight seasons with injuries, could face a tight market.
OF, New York Yankees
McCutchen has an opportunity to shine for the Yankees in the postseason, but the five-time All-Star has been regressing since his 2013 MVP season.