The Jon Lester contract situation

[sk7326]

Times are changing. The qualifying offer changes the free agent game quite a bit, but that is really besides the point. The Sox don't want to pay Lester for his past performances when he is in his declining years. Just look at Papelbon's and Sabathia's declining velocities and performances.

 

I believe teams will soon (and should) start to look at long term contracts in terms of future and potential performance rather than past performance going into the declining years. I keep seeing Homer Bailey's six-year $105 million dollar contract being used as a comparison for Lester. The difference is that Bailey is three years younger, and Cincinnati must overpay to retain their best young players.

 

Boston just won a championship and has a strong farm system. The Cardinals played hardball with Albert Pujols and have benefited from that decision. The Sox need to move forward and trust the changes that are coming...and their farm system.

 

Pujols not the sort of commodity which would be a strong future bet (shoddy athleticism, not much to go on besides his . A pitcher who never gets hurt and can spin 200 IP or so of #1/2 level pitching (with a couple of back end years of #4 more likely) is pretty valuable, and the industry has placed a tremendous premium on being able to pitch. With such a bullpen driven game, guys you don't need to worry about have value.

[sk7326]

Lester wants to stay in Boston, like I keep saying, they'll sign him for less than you all think

 

Less != Bubkus

[User Name]

Pujols not the sort of commodity which would be a strong future bet (shoddy athleticism, not much to go on besides his . A pitcher who never gets hurt and can spin 200 IP or so of #1/2 level pitching (with a couple of back end years of #4 more likely) is pretty valuable, and the industry has placed a tremendous premium on being able to pitch. With such a bullpen driven game, guys you don't need to worry about have value.

 

Pujols had/has shoddy athleticism?

[sk7326]

Pujols had/has shoddy athleticism?

 

Not a fatso, but still a 1B/LF type. Lot of those guys if they deteriorate it moves quickly.

[User Name]

He's big and muscular, but he's not unathletic or fat. He has a bad body type because being too muscular can also be detrimental to durability over the long term, not to mention the possibility of steroid use. But Pujols is (and has always been) about as athletic as a linebacker playing baseball (like Beltre) can be.

[Behindenemylines]

Lester has looked good so far and I think the Sox will get the contract done before he cab test the market.

[seabeachfred]

Lester has looked good so far and I think the Sox will get the contract done before he cab test the market.

 

You think so, huh? Well start praying just the same because the Sox are going everything to hint at him that he can walk.

[sk7326]

Long season - Lester could have been more standoffish but hasn't been. My inference is that there is a deal to be had here. Sox have to know how hard it is to find good durable help.

[BSN07]

Long season - Lester could have been more standoffish but hasn't been. My inference is that there is a deal to be had here. Sox have to know how hard it is to find good durable help.

 

Every team knows that. But signing a guy to 20M+ through his 30's is a big risk these days. Lester is probably a front line SP the next years but after that it's a crap shoot. What if he pulls a CC? I don't want to have to hope he's at least a mid rotation guy not half way through that deal. I love Lester and think he is a really good SP. But I'm not gonna cry when the Sox don't offer him 6+ years at 20M+ per. They offered him 4 and probably will go 5 with a vesting 6th year option at 17-19M per. If he wants more then that I'm betting they let him walk.

[Bellhorn04]

What's a little surprising is that the Sox offer was low on both counts - years, but especially AAV. 13.25 for Dempster and 17.5 for Lester? Yeesh.

 

Full credit to Lester, he hasn't made one disparaging comment and he's out there pitching well.

[sk7326]

Every team knows that. But signing a guy to 20M+ through his 30's is a big risk these days. Lester is probably a front line SP the next years but after that it's a crap shoot. What if he pulls a CC? I don't want to have to hope he's at least a mid rotation guy not half way through that deal. I love Lester and think he is a really good SP. But I'm not gonna cry when the Sox don't offer him 6+ years at 20M+ per. They offered him 4 and probably will go 5 with a vesting 6th year option at 17-19M per. If he wants more then that I'm betting they let him walk.

 

I am not sentimental either. But I also know what the market is like, and is not going to ooze respect for the Sox pinching pennies. I am not looking for them to be wildly irresponsible, but they have financial edges - and to put it into Luis Suarez' pockets is not something I am too keen on. I can see the concerns you speak of in isolation - but nothing about Lester's mechanics or past provide much fear that he won't still be a pretty useful guy as he descends from peak level. In 3 years, $20M is pretty much the going rate for an innings eating #3/4. It sounds like a lot of money - because it is - but not within the context of spigot of national TV money coming as well as the gold mines the Red Sox have long had at the local level. Henry Owens could be potentially as good as Lester - but there is almost no chance he can carry the innings load Lester can over the next 3 years. If you look carefully, there are zero teams who are putting that much on kiddie starting pitcher's shoulders.

[SoxSport]

The foundation of your understanding about franchise value is crippled. Judging by your conclusions, I don't think you account for anything other than TV contract total before deciding which team has more value.

 

It's all about TV. check the Dodgers and the Angels lately.

[User Name]

It's all about TV. check the Dodgers and the Angels lately.

 

No it isn't. You don't understand how team's revenue streams work, yet continue pretending that you do. Stop.

[SoxSport]

I wouldn't count on it Palodios. Did you see the Red Sox's latest offer.......four years and $80 million? That's a f***ing insulting offer if there ever was one. What the hell could Cherington be thinking? And as Lester keeps pitching well the price will only keep going up. It looks to me like the Sox are screwing up again with their free agents. To me, unless something radical changes on the part of the front office Lester is as good as gone.

 

LOL. The Red Sox offer is probably what he's worth. Forget the rest of the market. What do you want to compare to? Yankee dollars? Dodger dollars? Cannot do. Besides, how many CEOs make that kind of money? It's absurd to have to think in these terms, but that's the life of the TV sports these days--thanks to you and my cable bills (and many fans who have no clue about where those millions are coming from).

 

Having said that, they'll probably settle for 5 years with an option year. How old is he? 30? That sounds about right. And with even that, they aren't going to get their moneys worth the last year or two.

 

They have a strong farm system with kids coming up. They feel they don't have to overpay--especially into late years when they might get back 25 cents on the dollar. That is what's killing the Yankees. And they're still doing it because they have no choice. They MUST make the playoffs. Their market dictates it.

[Bellhorn04]

LOL. The Red Sox offer is probably what he's worth. Forget the rest of the market. What do you want to compare to? Yankee dollars? Dodger dollars? Cannot do.

 

You do realize that Miggy, Pujols, Cano, Votto, Fielder, Mauer, Verlander and King Felix don't play for the Yankees or Dodgers right?

[redsoxrules]

You do realize that Miggy, Pujols, Cano, Votto, Fielder, Mauer, Verlander and King Felix don't play for the Yankees or Dodgers right?

 

5 of those are hitters and the 2 pitchers are above Lesters league.

[redsoxrules]

If Lester would not be taking a home town discount I'd value him around 21-22 MIL a year.

The Fact that he has stated he wants to stay in Boston and a home town discount , 18-19 Ish a year would be good to keep him. Lester Is solid but he's not Cy young worthy. In fact he's never mentioned in a CY race. All the top paid pitchers in the game have CY type years minus Tanaka. Lester does NOT belong in the 25 MIL a year category for pithers

[User Name]

5 of those are hitters and the 2 pitchers are above Lesters league.

 

His point flew right above your head. He's saying that not only Yanks/Dodgers are paying premium dollars for talent, and he's right.

[sk7326]

LOL. The Red Sox offer is probably what he's worth. Forget the rest of the market. What do you want to compare to? Yankee dollars? Dodger dollars? Cannot do. Besides, how many CEOs make that kind of money? It's absurd to have to think in these terms, but that's the life of the TV sports these days--thanks to you and my cable bills (and many fans who have no clue about where those millions are coming from).

 

Having said that, they'll probably settle for 5 years with an option year. How old is he? 30? That sounds about right. And with even that, they aren't going to get their moneys worth the last year or two.

 

They have a strong farm system with kids coming up. They feel they don't have to overpay--especially into late years when they might get back 25 cents on the dollar. That is what's killing the Yankees. And they're still doing it because they have no choice. They MUST make the playoffs. Their market dictates it.

 

That last sentence is the words of somebody who has never listened to a second of WEEI or The Hub.

 

BTW: I do enjoy that you are pleased with the idea of running the team like a Wal-Mart while they charge you and me prices which are quite nicely in line with the commitments Yankees ask from their Nation.

[Palodios]

The Red Sox have 78 million dollars to 2015. Factoring in arbitration raises to a few guys and Doubront's first year, we are probably looking at 95 million dollars committed to payroll, but only 90 million against the luxury tax.

 

The positions that will need to be replaced are Catchers(2), Relievers (3-4?) Starters(1-2) and 1-2 Outfielders. The majority of those positions will be filled with the farm system which means there will be plenty of payroll for other significant players who deserve it. All of the big money free agents are SP/3B/SS -- unless the Red Sox want to overpay for someone like Scherzer or Shields, Lester makes the most sense here by far.

 

I am definitely running in circles here, but Lester just makes the most sense, and no other free agent seems like a better fit.

[jacksonianmarch]

The Red Sox have 78 million dollars to 2015. Factoring in arbitration raises to a few guys and Doubront's first year, we are probably looking at 95 million dollars committed to payroll, but only 90 million against the luxury tax.

 

The positions that will need to be replaced are Catchers(2), Relievers (3-4?) Starters(1-2) and 1-2 Outfielders. The majority of those positions will be filled with the farm system which means there will be plenty of payroll for other significant players who deserve it. All of the big money free agents are SP/3B/SS -- unless the Red Sox want to overpay for someone like Scherzer or Shields, Lester makes the most sense here by far.

 

I am definitely running in circles here, but Lester just makes the most sense, and no other free agent seems like a better fit.

 

Even if Scherzer is the better talent, you know what you have in Lester. Scherzer might come to Boston and just fold under the pressure

[vjcsmoke]

I am not sentimental either. But I also know what the market is like, and is not going to ooze respect for the Sox pinching pennies. I am not looking for them to be wildly irresponsible, but they have financial edges - and to put it into Luis Suarez' pockets is not something I am too keen on.

 

1. I don't see how Luis Suarez has anything to do with the Red Sox.

 

I can see the concerns you speak of in isolation - but nothing about Lester's mechanics or past provide much fear that he won't still be a pretty useful guy as he descends from peak level. In 3 years, $20M is pretty much the going rate for an innings eating #3/4. It sounds like a lot of money - because it is - but not within the context of spigot of national TV money coming as well as the gold mines the Red Sox have long had at the local level.

 

2. 20m for a #3/4 pitcher is blatantly and egregiously OVERPAID.

 

Henry Owens could be potentially as good as Lester - but there is almost no chance he can carry the innings load Lester can over the next 3 years. If you look carefully, there are zero teams who are putting that much on kiddie starting pitcher's shoulders.

 

3. And Henry Owens would not be and won't expected to carry a heavy load in his rookie season, so this argument is moot. The Red Sox are in the business of winning and have better options than trying out an untested pitcher for a lot of innings. You're the only one I'm seeing who thinks that Henry Owens would be our only alternative to Lester if he walked.

 

Honestly, I expected to see a Lester extension done sooner, but if his agent is asking for crazy money I could see them letting him walk. Lester is certainly above average, but has he proven himself to deserve Ace money? No, not yet. This season will be a big indicator to see if he can be that Ace, franchise pitcher.

[rjortiz]

1. I don't see how Luis Suarez has anything to do with the Red Sox.

 

John Henry owns Liverpool.

[vjcsmoke]

John Henry owns Liverpool.

 

Again they have NOTHING to do with each other. Different franchises. Different sports. Even Different countries.

 

I wouldn't count on it Palodios. Did you see the Red Sox's latest offer.......four years and $80 million? That's a f***ing insulting offer if there ever was one. What the hell could Cherington be thinking? And as Lester keeps pitching well the price will only keep going up. It looks to me like the Sox are screwing up again with their free agents. To me, unless something radical changes on the part of the front office Lester is as good as gone.

 

I sure hope that I have the good fortune of being INSULTED by a 20m dollar per year offer someday. That statement is pure hyperbole.

Edited April 16, 2014 by vjcsmoke

[rjortiz]

Again they have NOTHING to do with each other. Different franchises. Different sports. Even Different countries.

 

They are under the umbrella of Fenway Sports Group. John Henry could easily divert money to Liverpool instead of the Red Sox.

[Bellhorn04]

If the offer from the Red Sox really was 4 years, $70 million, it's just a ridiculously low offer.

 

The 5 year, $82.5 million contract that the Yankees gave A. J. Burnett after the 2008 season set the bar at the time for #2 pitchers. That was 5 years ago, and there has been huge inflation in pitcher salaries since then.

 

That same year, Derek Lowe got 4 years, $60 million, and he was going to turn 36 that season.

[jacksonianmarch]

A complete unknown got a 7yr $152 mil deal from NY. Max Scherzer is asking for $25 mil a season. Lester most likely considered himself on that level. Cliff Lee, a rather good comparable, got $25 mil a yr 3 yrs ago. That's likely what he'd get on the open market, and he'd likely get 6-7 yrs. the offer the sox made was a Beckett extension, and it's a massive lowball offer. Consider that Lester would get 6 yrs $140-$150 mil, he got offered two less years and half the money he'd get on the market

[Palodios]

In 2011, when the "Best Team Ever" was off to a terrible start, one of the beat writers mentioned that the whole team was playing like garbage, and that only two players deserved to be on the plane back to Boston -- Jed Lowrie and Jon Lester.

 

Three years later, Jon Lester is, again, the anchor of this staff. Three starts averaging 7 IP, 2 ER. He is as reliable as a starter gets.

[sk7326]

1. I don't see how Luis Suarez has anything to do with the Red Sox.

 

 

 

2. 20m for a #3/4 pitcher is blatantly and egregiously OVERPAID.

 

 

 

3. And Henry Owens would not be and won't expected to carry a heavy load in his rookie season, so this argument is moot. The Red Sox are in the business of winning and have better options than trying out an untested pitcher for a lot of innings. You're the only one I'm seeing who thinks that Henry Owens would be our only alternative to Lester if he walked.

 

Honestly, I expected to see a Lester extension done sooner, but if his agent is asking for crazy money I could see them letting him walk. Lester is certainly above average, but has he proven himself to deserve Ace money? No, not yet. This season will be a big indicator to see if he can be that Ace, franchise pitcher.

 

*********

A few silly things to respond to here.

 

1. First, $20M for 200 IP of #3 pitcher in 2017 dollars is not at all overpaid. When you look at the comps, to say so is ridiculous.

2. 4/70, if that is the number is an absurd offer. Comparing it to you or my meager means of living means jack squat. I can make a terrific living out of $100,000 a year. But if the revenue I am producing tracks to $20M a year (for instance), my wonderful salary is still insulting and woefully inadequate compared to the production.

3. There are maybe a half a dozen franchise pitchers. If you think the option is to swap Lester with one of those (Kershaw, Darvish, King Felix, Scherzer maybe, Jose Fernandez maybe, David Price maybe, just going off the top of my head), then there is a conversation to be had. If it is swapping Lester with a James Shields - you are paying more money (because he will cost more) for less pitcher (more consistent by a little, lower ceiling by a lot). Otherwise, you are going to insource Lester's production - which is cool, but none of the guys on the farm will be able to produce the innings. To supplement this, you need either more filler (which you'd be paying either Lester prices or asking for Ryan Dempster) or more middle relief (which is generally a land of crappy pitchers by comparison).

4. You seem to have a very very cockeyed idea of the economics of the pitching market. Even if Lester is not an ace - and is more a 2/3 starter (which is a fair assertion), the extremely high probability that he can crank out 900-1000 innings over the next 5 years at more or less that production level gives him a HUGE leg up as a commodity over people with sexier ERA stats. Daisuke Matsuzaka was much less hittable than Lester in 2008, but when you cannot actually take your team into the 7th inning during most of the 30-35 times a year you are scheduled to go - who cares? You don't need a staff ace to win a title or dominate a season - the 2013 Red Sox proved that. What you do need is the ability to continually get into the late innings with your starters. The stat which correlates the best with winning big is how few number of starters a team needs to get through the marathon. Jon Lester is the sort of guy who is essential to that goal.

5. And this is not one of your points, but an earlier commenter. The Red Sox do not live in the market that NY and LA do - boo hoo. But they live in a phenomenal revenue market. Markets differ in both size and fan interest - and the Red Sox play in a city where wins bring in extra money. I hate the $/WAR calculation because that ignores the realities of markets - for Boston, that number is HIGH ... for Tampa that number is low ... for most other teams that number fluctuates. Lester's production is more valuable to John Henry's bottom line than it is to the Rays owner.

[rjortiz]

It's all about TV. check the Dodgers and the Angels lately.

 

TV is a good-sized portion, and the main reason why MLB revenues are exploding, but they are not the sole component of MLB team valuation. Regional network values are highly speculative, and the average annual rights fee paid to the teams are backloaded. Look at the Astros fiasco. They have an annual rights fee of $80 million, as well as an equity stake in the network. CSN still can't work a deal out with the cable companies to broadcast the Astros. CSN only paid out $29 million to the Astros before it went bankrupt. The Astros valuation fell 15% in one-year. Jim Crane claims that he's lost hundreds of millions from the TV deal. TV contracts are driving the values of MLB team up, but any prospective buyer would have to agree with the continued viability of a regional network. The Dodgers have to be worried about Direct TV, Cox, Verizon, Dish, AT&T, and Charter refusing to carry the Dodgers TV network. That's 70% of the Los Angeles TV market. The TV deal has to be on taking water. The $8.35 billion TV contract was a huge reason the Dodgers went for $2 billion. They are struggling to get the Dodgers on TV right off the bat. What does that say about that validity of that $2 billion valuation?

 

Focusing on TV value ignores the rest of the components that goes into valuation (ticket sales, concessions, sponsorships, etc.). It also ignores the amount of debt each team holds. The Yankees have a $2.5 billion value, but how much of that is debt that will have to be assumed by the buyer? Forbes has the Astros debt/value ratio is 49%. A $550 million value includes all that debt. We don't even know if that is an accurate number. The Yankees are only at 1% according to Forbes. Yankee Stadium LLC is the obligor of $1.34 billion in bonds that financed the stadium. Before the sale of the YES Network to Newscorp, the network was $1.4 billion in debt. The parent company of the Yankees are diverting expenses to other companies, and the profits to the team. They won't be so generous to the potential buyer.