Alex Rodriguez questions Ohtani’s $700M deal, terms it a threat to baseball

Yankees great Alex Rodriguez is with Dodger's Shohei Ohtani.

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When he was playing, Alex Rodriguez secured the most lucrative contract in the history of baseball for himself. However, he is unhappy over the huge $700 million contract Shohei Ohtani has signed with the Dodgers and feels that it is going to damage the game.

Having been a three-time MVP during his 12 seasons with the New York Yankees, Alex Rodriguez appeared content with his salary at the time. However, now that he’s retired and witnessing others reach unprecedented financial milestones, he believes that baseball is currently in a state of disarray.

Why Alex Rodriguez is opposed to Ohtani’s massive contract

During a HOPE Global Forums panel, Alex Rodriguez expressed his perspective that the Ohtani deal was highly beneficial for the Dodgers and for Ohtani himself, but he believed it was a disadvantageous deal for baseball and the remaining 29 owners.

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Rodriguez elaborated on what he considered to be inaccuracies, stating, There’s a significant difference in TV revenue between teams in the same league. The Dodgers reportedly receive $250 million annually from cable, while the Marlins receive $15 million. This discrepancy raises concerns. Additionally, Alex Rodriguez pointed out that there are two teams whose total annual payments to 26 players fall below Ohtani’s yearly salary of $70 million. He suggested that such financial disparities raise questions about the sustainability of the business model in baseball.

The discrepancy in cable earnings among teams is the reason why Alex Rodriguez, who has taken on a quasi-economist role in retirement, advocates for MLB to embrace an alternative model. This proposed model would involve equal sharing of TV revenue among all teams, coupled with the implementation of a salary cap.

shohei-ohtani
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Alex Rodriguez posed a question, stating that the NFL’s success is rooted in parity, where everyone receives equal shares regardless of location—whether it’s New York, Buffalo, or Jacksonville. This shared economic model fosters sustainability.

Expressing concerns about baseball, he pondered on the competitive challenge faced by a team like Tampa in comparison to the Dodgers. Alex Rodriguez highlighted the financial strength of the Dodgers, suggesting that they possess substantial financial resources and are likely to continue prospering.

Hypocrisy or genuine pep talk?

As per Spotrac, Alex Rodriguez amassed a total of $455 million throughout his baseball career, achieving the status of the league’s highest-paid player twice. This occurred in 2000 with the Texas Rangers on a 10-year, $252 million contract, and again in 2007 with the Yankees, signing a 10-year, $275 million deal.

Alex Rodriguez playing for the New York Yankees
Kathy Willens/Associated Press

However, he is questioning Ohtani’s 10-year, $700 million contract, which includes $680 million in deferred money. According to reports, this arrangement entails Ohtani earning $2 million each year throughout the duration of his contract. This detail might be quite astonishing for him.

As per Forbes, the Yankees’ YES Network raked in $143 million in cable revenue in 2022, establishing itself as the most profitable network in the league. Forbes also places the Yankees at the top spot in team valuation with an impressive $7.1 billion, leaving the Dodgers trailing at No. 2 with a valuation of $4.2 billion. The Dodgers, in turn, benefit from partial ownership of Spectrum SportsNet LA, a network that reportedly generates the second-highest cable revenue, earning an estimated $6.48 per subscriber per month, as outlined by Sportico. SportNet’s lucrative deal with then-Time Warner Cable spanned from 2014 to 2039, amounting to a reported $8.35 billion.

In addition, the Marlins find themselves among the teams receiving revenue-sharing funds, receiving $70 million in 2019, as disclosed by The Athletic. This allocation is a consequence of the mandatory 48% revenue pool share that teams are obligated to contribute. Lastly, it’s worth noting that six teams currently boast payrolls under $70 million, although this figure is expected to evolve as the offseason progresses.

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