When the news first broke, the magnitude of the number was almost overwhelming.
It has only been 366 days since the Los Angeles Dodgers and Shohei Ohtani came to an agreement on a groundbreaking 10-year, $700 million contract. Initially, the figure seemed astronomical, making headlines everywhere. It easily surpassed the previous record set by Mike Trout’s 12-year, $426 million extension with the Los Angeles Angels just a few years prior.
However, as more details emerged, the deal took on a more intricate complexity. A staggering $680 million of the total amount would be deferred until the end of the 10 years, with Ohtani receiving only $2 million per season during his playing time with the Dodgers. The remaining sum would be paid out from 2034 to 2043 in annual increments of $68 million.
This unconventional structure reduced the present value of Ohtani’s contract from $700 million to approximately $460 million, factoring in inflation. While still a remarkable sum, it was no longer an unprecedented figure.
Fast forward to Juan Soto’s recent record-breaking 15-year, $765 million deal with the New York Mets, and Ohtani’s contract with the Dodgers now appears to be a bargain.
Soto’s contract mirrors what Ohtani’s deal initially looked like: extraordinary, record-setting, and almost incomprehensible. Unlike Ohtani’s contract, Soto’s includes no deferred payments, a $75 million signing bonus, and an opt-out clause after 5 years. Negotiated by agent Scott Boras, the true value of Soto’s deal is indeed $765 million, surpassing Ohtani’s estimated amount by over $300 million.
This astronomical number was driven even higher by a fierce bidding war between Mets owner Steve Cohen and Yankees owner Hal Steinbrenner, orchestrated skillfully by Boras to push the price up.
Ohtani and his agent, Nez Balelo, took a different approach during his free agency, showing a preference to remain on the West Coast. This limited the potential ceiling of his contract, a factor that didn’t seem to bother Ohtani given his immense marketability.
The immense popularity of Ohtani further distinguishes him from Soto, a talented player in his own right. A recent report from the L.A. Times estimated that the Dodgers reaped significant revenue from Ohtani’s presence in 2024.
Ohtani’s impact on and off the field in his first year with the Dodgers was extraordinary, with an MVP win and a World Series title boosting his financial influence. The advertising opportunities that come with Ohtani essentially offset the cost of his contract.
While Soto’s arrival in Queens will undoubtedly energize fans and drive ticket sales, he does not possess the same level of global influence as Ohtani. This dynamic serves as a stark reminder that one year after the initial shock of Ohtani’s “$700 million” deal, it already appears to be a steal.