Major League Baseball and Japan’s Nippon Professional Baseball league established an agreement in 1998 that would protect both Japanese players and their teams from being vultured by American clubs. Prior to the completion of this posting system, players in the NPB could find ways to void their contract – such as through retirement – in order to be free to negotiate with an MLB team. In present day, any player under contract with an NPB club can only transfer to MLB if he’s put up for silent auction (posted), the Japanese team accepts the winning bid, and the player and US team agree upon a contract within 30 days. The system has been working as intended, as while the league has lost stars such as Ichiro Suzuki, Daisuke Matsuzaka, and Yu Darvish over the past 12 years, their teams received 13.125 million, 51.111 million, and 51.703 million for their players respectively.
A new variable has been added to the equation, and that variable is named is Shohei Otani. Despite being drafted first overall by the Nippon Ham Fighters, Otani has said he wants to play in America directly out of high school, skipping the Japanese professional leagues altogether. It would be a groundbreaking move, as according to Ben Badler of Baseball America, scouts can’t remember the last player to make such a transition. He would not fall under the restrictions of the Rule 4 draft – that pertains only to amateur players from the United States, Canada, and Puerto Rico. Instead, Otani would be classified as an International Free Agent, which brings a whole new set of rules into play.
Every team in Major League Baseball was granted a 2.9 million dollar “bonus pool” in the new Collective Bargaining Agreement, and that pool is inclusive for all signings between July 2nd, 2012, and July 1st, 2013. In future years, the size of that bonus pool will be dependent upon a number of factors, primarily the reverse standings from the previous season. The thing is, most teams spend a majority of that money within the first 24 to 48 hours of the signing period, as that’s when most of the elite Venezuelan, Dominican, and other Latin American 16 year olds are negotiating. Toronto is one of the teams who fall under that category, as between Franklin Barreto and Richard Urena, the team spent 2.175 million on the first day. That number had originally been much higher, but the contract of Luis Castro (800 thousand dollar bonus) was voided after he failed his physical. On the other hand, because their deals with Yasiel Puig and Jairo Beras came prior to July 2nd, 2012, the Dodgers and Rangers respectively have tons of wiggle room in their bonus pool.
Many people are familiar with the penalties of going too far over slot in the Rule 4 draft – i.e. the potential loss of first round picks in future years – but the penalties for doing the same in International Free Agency is less well known. Again, via Ben Badler, here is the breakdown of potential penalties:
- Teams that go 0-5 percent over will pay a 75 percent tax on the overage.
- Teams that go 5-10 percent over will pay the 75 percent tax on the overage and won’t be able to sign more than one player for a bonus of more than $500,000 in the 2013-14 signing period.
- Teams that go 10-15 percent over will pay a 100 percent tax on the overage and won’t be able to sign any player for a bonus of more than $500,000 in the 2013-14 signing period.
- Teams that go 15 percent or more over will pay a 100 percent tax on the overage and won’t be able to sign any player for a bonus of more than $250,000 in the 2013-14 signing period.
The taxation is basically a non factor, as teams heavily invested in acquiring International talent aren’t afraid of spending money. Basically, the penalty is the further over your 2012 cap you go, the less money you can spend on any single player the following year. The size of your bonus pool itself isn’t affected, just the amount you can spend in any one spot. The 250,000 dollar per player limit is restrictive; however, as of Baseball America’s top 20 players from the 2012 signing period, the lowest bonus was the 540 thousand dollars the Phillies gave Dominican outfielder Jose Pujols. When looking at a unique situation like we are with Shohei Otani, teams need to ask themselves two things. First; is he worth the huge bonus he’s likely to receive, and second; is he worth eliminating your chances at highly regarded players next year as well? To decide this, you need to look at the player himself.
At just 18 years old, Otani stands 6-foot-4, and weighs in at 190 pounds. Baseball America describes him as “a strong, physical pitcher with square shoulders and a durable body.” They continue on to compare his physique to that of Yu Darvish – who completely changed the way Japanese pitchers view strength and conditioning, saying that Otani is more physically developed that Darvish was at the same age, particularly with strength in his lower half.
Leg strength is extremely important for pitchers, and Otani’s has helped enable him to touch as high as 98 mph with his fastball. The pitch is more regularly clocked in the 92-96 mph range, but that’s in Japan where starting pitchers work every sixth or seventh day. In the United States, it’s every fifth day, and Ben Badler suspects the pitch may settle in the lower end of that range under the more physically demanding American regimen. The life on the pitch is inconsistent, as while at times he’ll show plus movement, other times it flattens out. Some of these problems may be the result of overthrowing, which again speaks to the theory that he’d be better served working primarily in the 92-94 mph range.
Otani features a variety of offspeed pitches. Baseball America says his best secondary offering is an 82-85 mph slider with tight movement, and that he also throws a splitter. Like many Japanese pitchers, he’ll throw a slow, high arcing curveball as well. The long term value of that pitch is questionable, as while it can be used to fool young hitters, it’s not something that should be relied upon when facing the advanced hitters of Major League Baseball. The biggest knock against Otani is his command – or lack thereof, as he’s supposedly prone to stretches of wildness.
In conclusion, you have a physically mature pitcher with a power fastball, a good breaking ball, and poor command. Baseball America suggests that while he compare favorably to the top pitchers on the July 2nd International market (Jose Castillo, 1.55 million and Jose Mujica, 1.0 million), he grades a step behind the top three high school pitchers in the 2012 draft, Lucas Giolito (16th overall, 2.925 million), Max Fried (8th overall, 3.0 million), and Lance McCullers (41st overall, 2.5 million). What kind of bonus does that put him in line for? Theoretically, something between 1.55 and 2.5 million, so if we go roughly with the midpoint, 2 million dollars.
For the Blue Jays to offer a bonus like that, they would need to exceed their cap by over 1.5 million, and when including the 100% tax on top of that, we’re looking at roughly 3.5 million total. While I don’t doubt that he would be worth the risk if the cost was money alone, losing your ability to acquire top talent next year is extremely prohibitive, especially when you factor in that the Blue Jays’ 10th worst finish should give them a 2013 bonus pool in the vicinity of 3.5 million dollars. If Toronto leaps out of the darkness and lands Otani I’ll be shocked, as while General Manager Alex Anthopoulos has shown unmatched aggressiveness in acquiring high upside amateur talent, he’s not the type of guy to forfeit the opportunities that can and will present themselves in 2013. On an even playing field I might give the Blue Jays a chance, but with the amount of space under the cap both the Rangers and Dodgers have, the organization would be better served sitting this one out.