Long-Term Deals: The Way to the Future

Two things caught my eye this morning, and while on first glance you would think they aren’t related, in fact they may be tied together.

The first is an article by Jeff Passan on how the money involved with regional sports network deals, such as the one the Dodgers are expected to take that will be between $6 and $7 billion dollars, are going to widen the gap between the rich and poor in baseball.

The second is the news that Evan Longoria has signed a $100 million dollar extension with Tampa that will keep him with the team until as late as 2023, depending on options.
How are these connected? Well, in a word, the events of the first article will probably lead to us seeing more deals like the Longoria deal of the second article.

Consider: the bubble of money that Regional Sports Networks will bring the big market teams- amounts of money that not even revenue sharing will dent all of that much- will make it extremely hard for teams to keep top free agents from leaving. A team like Tampa will just simply be unable to outbid, even on a good day, one of the top markets. While of course there will be some exceptions such as “hometown discounts” and big markets botching negotiations, the fact is that the best way for a smaller market to keep talent will be to make sure that they never leave in the first place. The way to do that? Sign them up early, and sign them up often.

Longoria, for example, had already been signed to a contract extension early in his career, before he became his MVP self. That was a deal extremely kind to the Rays. This second deal is more in line with Longoria’s value, but is also good for the Rays (at least in the short-term), since it means that he won’t be leaving.

Longoria’s deal is just the latest in what has become a trend… but expect it to become the norm as time goes on.