Good morning, all. I hope your week is off to a terrific start.
The news broke Saturday. The most sought after free agent in years, Shohei Ohtani, agreed to a 10-year, $700 million contract with the Los Angeles Dodgers. On cue, the social media world was ablaze with criticism about the amount. “No one is worth that kind of money.” “Baseball is ruined.” “I’ll never follow the sport again. How can you give a baseball player that amount of money over surgeons and others who save lives?”
Interesting that none of these comments emerge when it is revealed Taylor Swift is raking in over a billion dollars. The fact is, like Taylor Swift, Shohei Ohtani is a brand and the Dodgers chose to buy a player and his brand with the hopes the return on their investment will exceed the $700 million the owners have pumped into his acquisition. There is nothing more or less to this story.
Did the Dodgers bid against themselves? Perhaps. You have to wonder if the other clubs rumored in the Ohtani sweepstakes, the Blue Jays and Giants, were willing to go over $500 million. This was the market winning out, even if the Dodgers were the lone bidders.
In reality, as along as the powerful baseball players association refuses to accept either a salary cap or salary floor, baseball, unlike the other sports, will continue under this structure, with the haves and have nots competing on an uneven playing field. Consequently, you will get contracts such as Ohtani’s, whose annual salary will be more than the payrolls of seven other big league clubs. You will get a club like the Dodgers, who have guaranteed $1.2 billion to their top three players: Ohtani, Mookie Betts and Freddie Freeman.
The game still has to be played on the field, and in truth, the Dodgers with their deep pockets, have not won a World Series since 1988. I know, they won it in 2020, but I have a difficult time accepting a sport which crowns its champion after a grueling, marathon season, determining its winner on a sprint, which happened in 2020.
The Dodgers have one of the best organizations (i.e. farm system, instruction, etc.) in the game, augmented by a hedge fund owner who has enough dough to cover for the club’s mistakes. All the Ohtani signing means is the have nots will need to be creative in order to compete with the haves. Tampa Bay has figured out the paradigm. Apparently Arizona has and Colorado is hoping its blueprint eventually bears fruit.
Meanwhile, do not fret about the game, despite the doom and gloom projections from the critics. Baseball may no longer be America’s Pastime, but it has figured out how to survive since the 19th Century. It will get along just fine.
What’s up with golf?
Welcome to the Fenway PGA Tour. Say what? In case you missed it, defending Masters Champion Jon Rahm is the latest big name golfer to jump to LIV Golf. He’s getting $600 million, according to his reports. Maybe he should have hired Ohtani’s agent. But I digress.
What happened to peace between the PGA Tour and Saudi-backed LIV tour? According to the Boston Globe, negotiations are ongoing, involving the PGA, DP World Tour (formally the European Pro Tour) and LIV. The goal is to create a worldwide golf tour, essentially relegating many PGA tournaments in the USA to second-rate status, as I read it.
In order for this to happen, the PGA Tour, which relies on sponsors to underwrite its operation, needs someone to buy the tour. Supposedly, the Saudi’s were going to step in and assume the PGA Tour operations but that may not happen. The Globe story indicates that a group of investors have formed the Strategic Sports Group and are looking to “support” the PGA and DP World Tours, in the words of Boston Red Sox billionaire owner John Henry.
Not to make your head spin here, but this strategic group includes the Fenway Sports Group, which owns the Red Sox, pro soccer teams in England and the NHL’s Pittsburgh Penguins, among other entities. But that Strategic Sports Group also includes investors Steve Cohen, owner of the New York Mets, Tom Ricketts, owner of the Chicago Cubs and Mark Attanasio, owner of the Milwaukee Brewers.
The golf landscape is about to change, but if the Red Sox, Cubs and Brewers do not have successful seasons, expect the fanbase of those clubs to cry that their owners seem to have their dollars channeled elsewhere.
That is it for this week’s newsletter. As always, thank you for your support and pray for peace.
SPORTSCASTER DAN