One big-money California business deal to watch is how rich Angels baseball star Shohei Ohtani will become once his current contract ends this year.
Ohtani, who’s making $30 million in 2023, will be a free agent when the season ends. He’ll be available for hire by any of Major League Baseball’s 30 teams to pursue. It’s all but given he’ll sign the priciest long-term contract in baseball history.
Now, it’s hard to argue that anybody paid $30 million in a single year is underpaid. Hey, it’s the 15th biggest paycheck in baseball, according to Spotrac. But if you’re not a sports fan, please realize this athlete is arguably the game’s best batter and pitcher – a two-way feat nobody else has pulled off.
Next week’s All-Star Game will serve as another billboard for Ohtani’s talents. He’s been named to the American League team twice thanks to his unique mix of skills. The festive gathering will only fuel wild speculation about Ohtani’s future: where will he play in 2024 and beyond … and for how much?
The guessing starts at a half-billion bucks for his next decade of work – topping Anaheim teammate Mike Trout’s $426 million, 12-year deal signed in 2019.
Already, Ohtani’s total baseball earnings – salary plus endorsements – are No. 1 in baseball at $70 million for 2023, as estimated by Sportico.
Ticket seller
I’ll let sports writers tell you how grand Ohtani is using ballgame stats. I’ve got my trusty spreadsheet.
Just think about Ohtani’s star power, measured by how he fills up Angel Stadium when he’s pitching and batting.
Starting pitchers like Ohtani play that position roughly every six days over a grueling six-month-plus season that runs 162 games, half played at home. And note the Angels draw much better on weekends, with crowds roughly 30% larger than mid-week games.
In 2022, Ohtani’s two weekend pitching starts in Anaheim averaged 36,891 in attendance – 629 extra fans vs. the team’s other Saturday or Sunday home games. That’s a modest 2% boost.
His star attraction shines for hard-to-sell midweek matchups. On Ohtani’s 12 weekday starts in 2022, Angel Stadium crowds averaged 29,221 – a larger bump of 2,181 or 8%.
The Ohtani ticket-sale halo more than doubled this year.
His pair of weekend pitching starts have averaged 40,135 fans – up 1,937 or 5% vs. all other Saturday-Sunday games. And his seven weekday starts drew an average 33,907 fans – an eye-catching 5,077 increase. That’s 18% more fans per game.
Imagine spreading that kind of popularity pop across a sports team’s economic reach – from TV ratings to merchandise sales to corporate partnerships.
Average star power
Ohtani is one of baseball’s premier players who’ll play as a 30-year-old next season.
Let my spreadsheet’s review of baseball’s largest existing long-term deals, as tabulated by Spotrac, give you some hints about Ohtani’s next payday.The “comps” start with the five batters with the fattest contracts. On average, owners were willing to give a 28-year-old superstar field player a deal 11 years long at $34 million a year or $371 million in total value.
Next, think about what the five highest-compensated pitchers got. This elite group, with an average age of 31, got six-year deals at $31 million a year, an average $198 million per package.
As you see, owners give batters almost twice as many big-money years as pitchers. That’s because field players compete every day and pitchers’ longevity is always an issue.
With Ohtani, however, I’ll argue his dual-threat powers also act as insurance against his long-term deal totally washing out. He’ll likely excel at some baseball skills for an extended period.
Bottom line
Ohtani shouldn’t settle for any “two-fer” discounts.
This unicorn of a player gets two jobs done with one roster spot. In baseball, where teams have limited rosters, his dual-threat status can be a colossal tactical advantage. Plus, there’s his giant marketing value, a global star expanded by his Japanese roots.
So he deserves to be paid for double duty: the average pay for premier batters plus what top-shelf pitchers make. Assuming a 10-year deal, the spreadsheet says Ohtani should get a $664 million package, or roughly $66 million a year.
Nice pay, but wait … there’s more! Half of these 10 top money deals I studied were made in 2021 or earlier. The newer deals were 5% pricer.
Yah, ballplayers get wage inflation, too! Add in that pricing factor and the spreadsheet says Ohtani’s worth $701 million over 10 years. That’s $70 million per season.
Look, all the spreadsheet did is take what teams are currently paying top stars and extrapolate those salaries to account for this peerless, two-way phenom. Note: the 14 players making more than Ohtani in 2023 average $36.6 million salaries at age 34.
Team owners are billionaires for a reason. They understand quality. They like expensive toys. But they also don’t like to overpay.
Yet it only takes one to make Shohei Ohtani an extremely wealthy man.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
Source: Orange County Register
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