Boras Blog

A Day's Work

As you read about the Strasburg deal, seeing it described as a "resonable deal", "fair compromise", etc., consider how Boras was able to completely reset the standards for a free agent contract.  Before the hype machine, before the talk of $50m demands, before the talk of international free agency and the liklihood of missing a year... think back a few months and consider what $15m guaranteed actually means.  Its a phenominal contract.  The best ever.  Outdone, perhaps, by  Dustin Ackley's $7.5m guaranteed.

A summary of the first rounders:

Stephen Strasburg (#1, Nats) - Four-year major league deal, $7.5 million bonus, $7.6 million in salaries ($15.1 m guaranteed).

Dustin Ackley (#2, Mariners) - Five-year major league deal, $6 million bonus, $1.5 million in guaranteed salaries, another $2.5 million possible in salaries depending on how quick he reaches the majors ($7.5m guaranteed).

Donavan Tate (#3, Padres) - $6.25m over five years, permission to play football as well.

Turner (#9, Tigers) - Major league contract with a $4.7 million bonus (over six years) and a guaranteed value of $5.5 million. Incentives up to $7 million.

Washington (#30, TB) - Did not sign.  Keeping them honest, I suppose.

MLB Trade Rumors is the place to go for more draft coverage and to see the rest of the first round contracts.

The Best Just Isnt Good Enough

Big day ahead, to be sure.  First round picks #1 Strasburg (Nats), #2 Ackley (Mariners), #3 Tate (Padres), #9 Turner (Tigers) & #30 Washington (Rays) are ALL going down to the wire.  Jeez, you think Boras is going to get to take a bathroom break today?  I would think he would have gotten one or two of these out of the way just to relieve capacity constraints on the organization.  I have a friend who works for a large online flower store, tells me that everyone from the CEO down delivers flowers on Valentine's day.  So, I have to wonder if the mail room clerks will be negotiating million dollar deals as we approach midnight.

By all accounts, the Nats have offered a deal surpassing Mark Prior's $10.5m deal from 2001.  So the question is, is the biggest contract ever extended through the draft a good enough deal?  Boras points out that revenues in baseball have doubled since the Prior deal, so you have to make that adjustment.  He also points to free agent signings - can you imagine the frenzy if a 21 year old came out of Cuba throwing the gas that Strasburg does?  Surely such a player would command the $50m Boras has reportedly asked for.

The Biz of Baseball does a nice job breaking down Strasburg's projected value and comes away with a 6/30 deal.  Ok, I think Boras would live with that.  I am not sure the Nats would, though.  If the Nats dig in at the $15m range, I dont think the fans will blame them for not completing the deal, and I dont think Boras will take it.  So, while most assume that a deal will go down tonight, I am not so sure.

Finally, the always amusing Kenny Powers - uh, sorry, I mean Rob Dibble, had this to say:

Kid, if you want respect you have to earn it, if you want to be hated as much as your agent Scott Boras, hold out and go pitch in independent league baseball.

The choice is really up to you -- hold out and put your progress towards the big leagues, push back time towards arbitration, and oh yea, risk getting hurt in some independent league game, or how about building on being the richest amateur draft pick to date in the history of MLB.

Crunch Time

Here we sit, six days before the deadline, Strasburg remains unsigned and I have nothing to blog about. No rumors, no updates, no speculation.

Meanwhile, Dustin Ackley, the #2 pick in the draft and a Boras client, remains unsigned as well.  I havent been able to write one word about Ackley yet, again - no rumors, no updates, no speculation.  But Ackley's case is far less fascinating than Strasburg.  We have already seen Boras go toe to toe against Mariners GM Jack Zduriencik for the Josh Fields contract.  That standoff, reportedly over the relative pittance of $500k, ended up with a deal at the midpoint. With Zduriencik coming from a player development background, I dont think he will let Ackley go unsigned. It would stand to reason that he knows that Boras knows that time is on Boras' side, for now, and they will come to an agreement at the deadline.

Strasburg, of course, is far more interesting.  For one thing, Interim GM Mike Rizzo is fighting for the job. He doesnt just want to the deal to go through, he NEEDS the deal to go through. And you can bet that Boras will test his fortitude.  For another thing, there is little precedent for the level of hype Strasburg has received. Well... I might have to scratch that - that is hard to quantify and it always seems like there is some prospect somewhere that has been anointed the future best player ever (related: Mat Witers OPS is below .700, Mark Prior is not currently affiliated with any MLB team). But the hype is obviously huge for Strasburg, and that hype - even if never substantiated - has value for the Nationals.  Finally, the Nationals... what's a franchise to do?  If it ever paid to overpay, it does for the Nats and their beautiful ballpark, their sleepy fan base and their city that thinks baseball is better left to their friends fifty miles up the 95.

My Offer Is This: Nothing.

The Nationals Journal blog at the Washington Post catches up with Stephen Strasburg at the Fan Fest.

Strasburg said that "I haven't heard from the Nationals" since he was drafted, other than receiving a minor league contract -- a technicality that prevents him from becoming a free agent.

Strasburg seemed a bit perplexed by the lack of communication since the signing deadline is Aug. 17 and many other Nats draft picks are already under contract. But he probably shouldn't be. Both the Nats and Strasburg are in a stalemate period now because both sides know the long history of negotiations involving clients of Boras. The agent never likes a first offer. Why should he? But, sometimes, those initial offers are also characterized, publicly, as insulting or alienating to the players he represents. This may be a sincere response or feigned, but it is consistent.

I get the feeling that the Nats are in a bit of a deer-in-headlights parralized state about the Strasburg situation.  They have so much to figure out internally - both on the field and behind the scenes - before being prepared to make smart decisions externally, but a deadline is a deadline and they are going to have to be willing to risk losing the deal if they want to effectively negotiate with any leverage.

Trying Something Unusual

Last week, Ben McDonald mentioned that Boras said to him that they were going to try something unusual with the Strasburg negotiations.  We got some attention when we suggested that he might be looking for a way to create free agency for Strasburg.  Well, the Washington Post may have  nailed it more directly:

Boras was dropping hints privately that he is preparing to explore a new frontier in his ongoing draft-busting crusade: Japan.

"If a [contract agreement] does not happen," Boras said during a conference call with reporters following the draft, "obviously you then look to all the available resources that one would have to evaluate what the next step is, whether it's to re-enter the draft, or alternative choices."

[snip]

According to Major League Rule 4(a), draft eligibility is limited to players who are "resident[s] of the United States or Canada and who [have] not previously contracted with a Major League or minor league club." Under Rule 3, which governs contracts, a player is considered a resident of the United States if he "enrolls in a United States high school or college or establishes a legal residence in the U.S. on the date of the player's contract or within one year prior to that date."

However, there is enough gray area within the issue of "residency" -- a notion Boras first explored in Drew's case in 1997, threatening at one point to take him to Costa Rica to establish residency -- that baseball has seen fit to publish a handbook, distributed to scouting directors and other executives before each year's draft, that clarifies what residency means.

At worst, the threat of Japan should give (even) more leverage to Boras over the Nationals.  At best, he will be able to pull it off.  The Japanese teams stand to gain a tremendous amount themselves, but as the article notes, it may be a complicated issue:

"This will do more harm than good to the NPB club. [Strasburg] will not be welcomed, neither by the teammates or the media," Kobayashi said. "It is not easy to sympathize with a guy who comes to Japan just as [part of] a negotiation process to squeeze more millions out of [an MLB] club."

According to Kobayashi, NPB officials are still perturbed about the Boston Red Sox' signing last winter of amateur pitcher Junichi Tazawa, violating what is seen as a "gentlemen's agreement" between the leagues that neither would pluck away the best amateur talent from the other.

"We would not do what we do not want others to do to us," Kobayashi said, "unless we really have to do so."

At the end of the day, if this is the desired avenue of the Boras/Strasburg team, it will probably end up in the courts.  MLB has too much to loose by allowing this precedent, and I imagine they will fight Boras on this, even if they will ultimately lose.  The legal clean-up that will likely follow - from CBA amendments to an eventual agreement between MLB and their oversees counterparts - will be quite significant.

Similar to the tax code, it seems that the more restrictive rules that MLB tries to put in place, the larger the advantage to those clever enough to find ways to challenge the system.  The fact is, only a true free market economy will level the playing field among all players/agents and teams.

If You’re Below $100 Million, You’re Nuts

Kevin Goldstein at Baseball Prospectus (Unfiltered) has an interesting take on Strasburg/Boras' signing bonus request:

With the draft comes never ending radio hits, many of the surprise variety when they call and want you on right then and there. When one talks about the draft on the radio with a national perspective, nearly all of the discussion revolves around Stephen Strasburg, and now that he’s been selected, all of the talk revolves around money. I’m sticking with my prediction of a $8-10 million bonus as part of a total package worth $20-30 million, and when I bring that up, hosts, listeners and others tend to just absolutely lose their mind, as if that’s the most insane thing they’ve ever heard. Yes, it’s two or three times the biggest bonus in draft history, but something changed in my mind yesterday about how much that really is, when taken into context.

Just so you know, I don’t really do other sports, especially football. I can name maybe 20 NFL players. I watch the Super Bowl, mostly for the ads, I couldn’t name the last three Super Bowl winners if my life depended on it, and I have no idea who this year’s National Champion was. But I’m watching baseball highlights on ESPN the other day and on the ticker at the bottom, it flashes that the New York Jets have signed their first-round pick to a $50 million deal, of which $28 million is guaranteed. Talking to somebody who follows the game, I learn that this guy is not the first pick in the draft, or even the first guy at his position selected this year, yet anything close to anything someone would describe as historical.

And yet, nobody blinks an eye.

Look, let’s say something weird happened over the next 72 hours, and Strasburg was found to be not a U.S. citizen but from Sweden or something, and therefore an international player and a free agent. Start the bidding . . . where do you think it ends? If you’re below $100 million, you’re nuts. What he’ll eventually sign for is a ton of money in relation to previous draft bonuses ONLY. In reality, it’s a bargain, in terms of both baseball itself and in relation to what incoming talent costs in other sports.

It's a Rare Case That a Deal Does Not Get Done

I bought a brand new grill the other day.  Spent an hour and a half putting it together - long enough for the clouds to come out.  Ten minutes after I finished, it started to rain.  So the next day, yesterday, I waited all day to break in that grill.  Skipped lunch, bought fresh buns and veggies.. the works.  And I went outside, scooped up a huge mound of beef, and watched my new grill slow-cook that burger to perfection.  Soon I was standing over the table - starving like Marvin - and Im telling you, for a moment, I actually drooled over that burger.  I am glad to have had that experience - not eating or cooking that burger, but the moment before - so now I can feel one-thousandth of what boras must be feeling at this moment.  An interim GM, a bumbling owner, a team in desperate need of igniting a fan base, a beautifully executed hype machine, the possibilities of Strasburg...  Scott, life's just not going to get any better than this.

Ok, here is where we stand:

"I think whenever you're drafted by a Major League team, the focus throughout the negotiations is, 99 percent of the time, to reach an agreement with a Major League affiliate and sign the athlete," Boras said.

"If that does not happen, you then would look to all the available resources one would have to evaluate what the next step is, including another Draft or an alternative place for the player to perform.

"But I would say in our history in the hundreds of entry-level contracts that we've done that it's a rare case that a deal does not get done with a Major League team. I'm sure it's in the 90th percentile."

There it is. Lets make a deal.  I am late to get this post out, so I cant add much beyond what Jon Heyman at SI already had to say.  As summarized at the always-excellent MLB Trade Rumors:

Here are the details:

• The Nationals would receive the second pick in next year's draft if they fail to sign Strasburg, but this would not be an acceptable consolation prize for the team. First, Strasburg is a unique talent. Secondly, the Nats can't afford to keep pushing back their future.
• Strasburg could sit out an entire year as J.D. Drew and Luke Hochevar did, but he'll receive an offer considerably larger than either of those two players, which could be hard to reject.
• Heyman doesn't think it's likely that Strasburg would go to Japan if he fails to sign.  

Well, I cant leave off on such a high note, and at the rate I have been posting lately I might just forget to add to the They Hate Boras bin, so here is one more piece of stupidity until I sign on again:  Boras is Bringing Down Basebal.