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The rumors came to fruition on Friday as Robinson Cano signed a 10-year, $240-million contract with the Seattle Mariners. This contract puts him alongside Albert Pujols for the second-richest contract in baseball history, and it also puts an elite bat in an otherwise lackluster lineup.
There are so many angles to this story that each one deserves its own long-form piece. You have new player-agent Shawn Carter a.k.a. Jay-Z having his biggest star signing his first mega deal less than eight months since forming Roc Nation Sports. There is the obvious baseball angle, where Cano has been one of the top five players in baseball since 2009, per fWAR. His talent is simply undeniable, and it goes beyond metrics. He’s had five straight seasons of a batting average over .300 and at least 25 home runs. You’d think Miguel Cabrera would lead baseball in hits in the start of 2009, at least I did. However, Cano has the edge on Cabrera 978-973 (albeit, in 59 more plate appearances).
The Business of Baseball
Robinson Cano has his World Series ring from the Yankees title season in 2009. There’s no real need to go anywhere to win immediately if he’s not of the mindset that he has to accumulate as many World Series titles as he can before he retires. If what he wanted was to win the World Series and set his family up for generations to come — mission accomplished. Cano has no obligation to anyone but himself and his family, and Yankees fans can thank him for being an important part of their only championship this millennium.
The Mariners are making a massive investment for what seems to be surely a declining asset before the first half of the contract is over if they’re lucky. What gets lost sometimes in these signings is that it’s not a straight line between value of on-field performance to contract worth. Of course, that’s not to say he won’t do well on the field either.
The Average Annual Value of the deal is $24-million per season. There are two different ways to look at how each season is valued. Per baseballprojection.com and ESPN, a reasonable estimate for a Win Above Replacement would be about $5-million each. That would make the direct on-field return from Cano to be about 15 WAR. From FanGraphs, Cano hasn’t had fewer than 5.3 fWAR in any season for four years straight, averaging a little over 6.3 fWAR over those four years. Assuming he maintains that average for at least three years, which isn’t unlikely given his aging curve, he’ll earn around 19 WAR over the next three years.
The problem is that aging curve dictates he probably can’t keep that pace up for longer than three years. It’s no secret that baseball players decline once they hit their 30s, and even with Cano profiling well enough to stave it off for a few more years, it’s coming eventually.
The bright side is the price of a win is only going to go up. BeyondTheBoxscore has the price per win from free agent signings pretty much doubling over the last 10 seasons. Assuming the price of a free agent win right now is $7-million, that could grow steadily to $14-million by the end of his contract. If he can accumulate 19 fWAR in the next three years, he’d already have earned $85-million in traditional pricing of fWAR, and up to $143-million in relative value to other free agent signings (given a $500-thousand increase in price/win every year). With a steady growth in price/win and steady decline in Cano’s performance, he might only have to earn about 20 wins in the final seven years of his contract to be worth his in on-field performance alone in fWAR. Compared to other free agents, he could fulfill his value in wins by year eight of this contract, assuming 2-3 WAR per year from age 35-37. It’s not that crazy.
The Business of Business
Of course, the on-field performance is uncertain. Does he age gracefully, à la Jeff Bagwell, who earned 12.3 fWAR from age 34-36? Or does he age with the grace that Albert Pujols has aged?
Let’s assume that he doesn’t fulfill his $240-million value. Assume he doesn’t perform too well over the next couple of years, as some recent high-priced free agents haven’t. The Mariners are coming into a new television deal that has an average annual value of $117-million per year for 17 years straight through to the 2030 season. There are a few extra dollars lying around to sign the top second baseman of the last half decade.
There are also going to be a lot (a lot) of promotions and events surrounding Robinson Cano and the Mariners as well. They did a good job of turning most of the lower section of the left field line into a King’s Court, I imagine it won’t be long until the other side of the field is Robinson’s Canoe or something equally ridiculous. What better way to attract new fans to ROOT Sports (and there are viewing issues and fees that could be a sticking point for some people) and to the ballpark than by saying “here is one of the best hitters and one of the best pitchers (Felix Hernandez) in baseball”.
This is a calculated gamble, one afforded the opportunity by an influx of a lot of television money. There’s a chance that with the increasing revenues league-wide that Cano does end up earning the $240-million in on-field performance, depending how you judge the value of a free agent signing. There is also the spinoff revenue that should be earned if they ever make a playoff run. Even if they don’t, Seattle now has one of the top baseball players, whose agent is a one of the top entertainers, in the world. It’ll be years before a clear picture is painted as to whether this is a smart move or not, but a $24-million/season contract will be relatively less pricey in five years, and is a better value than it was just five years ago.
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