When word got out this weekend that the San Diego Padres and Manny Machado reached an agreement on an 11-year extension worth $350 million to avoid opt-out drama, replace his existing contract and keep the superstar third baseman in San Diego for the rest of his career, the reaction was a bit like the catchphrase of the villain in every episode of Scooby-Doo.
How do the Padres do it?
That has been the refrain of the baseball industry for some time, and every repetition makes the rest of the industry look like confused people predictably whining about these meddling kids. Even before Machado’s extension, the team’s other owners they grumbled about open ambition (and open wallets) displayed by Padres owner Peter Seidler, New York Mets owner Steve Cohen, and Philadelphia Phillies owner John Middleton. Always in tune with the concerns of his ultra-wealthy employers, MLB Commissioner Rob Manfred praised the Padres as only he can earlier this month, saying they “have done a really, really good job of capitalizing on their talent to drive revenue,” but he also wondered aloud about their viability.
“The question becomes ‘How long can you keep at it?’ What happens when you have to go through a rebuild?’” Manfred told USA Today, noting that the Padres are expected to lose money in 2023.
Seidler’s answer, in so many words? Challenge accepted.
The Padres’ investment in Manny Machado was a win-win
At the heart of sports fans is a pact: You, the fan, invest your time and emotions — and yes, your money. You pay the ever-increasing fares. You pay cable to watch your local team when everyone else you know has cut the cable. You pay for a $15 beer. You pay $134.99 for a replica jersey.
In turn, the people behind the team — the front office, sure, but mostly the team owners — are trying to give you something worth rooting for, something worth spending discretionary income to enjoy. That’s how it should work.
In theory, it’s a circular system: fans eager for a baseball franchise exist. A team owner provides funds up front to create, relocate or rebrand a baseball team for a specified fan base. The fan base gathers around the said team. The team owner then improves the condition of his investment, thereby making money, and reinvests it in acquiring stars, winning and in turn encouraging even more fans to become even more interested in the team.
This is what some might call “capitalizing on your talent to increase your income.” Others would define this dynamic in simpler terms: You get what you pay for.
Many team owners and front offices have spent a lot of time trying to break the mental connection between spending money on stars and getting fans excited. Sustainability has become the buzzword of the day. Long-standing megadeals have become scarlet letters.
Seidler, who took control of the Padres in 2020, does not have sustainability in his personal motto.
“People love that word,” he told reporters in February. “Let’s find another one. Do I believe our parade will be on land or water or both?”
Near the peak of that sustainability movement, Machado and Bryce Harper waited out the icy winter of the free agent market, only to finally sign contracts with the Padres and Phillies, respectively, at the end of February. It’s nowhere near universal or linear, but it’s becoming clear that those two teams — contenders in the 2022 NLCS, led by aggressive managers AJ Preller and Dave Dombrowski — helped swing the spending pendulum back the other way.
Other factors: the comically awful outcome of the Mookie Betts trade to the Boston Red Sox, the addition of a financial superpower to Cohen’s Mets, and the increasing effectiveness of early-career extensions, as exemplified by Jose Altuve, Jose Ramirez, Julio Rodriguez, Wander Franco and just about every productive member of the Atlanta Braves .
What has become apparent is that long, lucrative contracts are not inherently bad ideas. Far from it. The lessons from the failed deals of Miguel Cabrera and Albert Pujols boiled down to more specific criticisms: Don’t sign players in certain age ranges or certain profiles with defensive limitations. Other failed deals fell for other reasons, with variations on the team theme taking half-measures around a big investment in a sport where one player can’t get the whole team on the field.
Turns out, none of that applied to Machado. In San Diego, he played 519 of a possible 546 regular season games. He finished in the top three in NL MVP voting twice and emerged as a vocal leader on two playoff teams — matching his total from 20 seasons in San Diego before his arrival.
If Machado had indeed reached the end of the 2023 season without a new contract and exercised his contract opt-out, the Mets, Yankees and a host of other teams would almost certainly have been chasing his services with a fervor that was absent in the dismal season. 2019 landscape So while the Padres got Machado for less than expected four years ago, they had to step up and commit more for the 30-year-old this week than they originally did for the 26-year-old. Why? Because as Machado so eloquently put it earlier this spring, “markets change.”
What the Padres win by doubling
The Padres won’t be caught taking half measures. Before Seidler took control of the franchise, they made their own big contract mistake by signing Eric Hosmer, who just wasn’t a good candidate in the first place. But the Padres weren’t afraid to save, a la the ownership group of the Cincinnati Reds. Instead, they learned from it and turned their attention to younger, more consistent, higher-end types of players who have proven useful as franchise leaders.
It’s getting more expensive, but it could prove to be more profitable in the long run. Since Machado took over at the hot corner, Preller and the staff have added Juan Soto, Xander Bogaerts, Josh Hader, Yu Darvish, Joe Musgrove and Blake Snell. Several of them will play alongside Machado for at least five years. The team also brought up Fernando Tatis Jr. and – despite some, uh, sagas – secured his jaw-dropping talent forever.
Padres fans reacted as expected. Despite the ubiquitous “small media market” label attached to the team, the Padres attract a relatively high percentage of potential viewers, scoring among the top five MLB teams in local ratings in recent seasons. After ranking 18th in MLB in average attendance in 2018. they were third and fifth in the last two seasonsdrawing more than 10,000 more fans per game in 2022 than the last iteration before the Machado Padres.
“We plant great fans for life,” Seidler told reporters in October. “And now, from our side, we always had an obligation, and now it is at a higher level. That’s good.”
A man whose social media accounts come with tags that sound more like “billboard poster” than “billionaire team owner” — how many complaints can you make to PadrePedro7? — Seidler has a vested interest in watching a good baseball team, just like the emotionally invested team owners in Philadelphia and New York. His grandfather was Dodgers owner Walter O’Malley, and Seidler has been open about wanting to build the Padres into a consistent, worthy rival to the Juggernauts in Chavez Ravine.
“I kind of like spending money,” he said in October. “You can’t take it with you.”
Strip away the immediacy of monetary commitments and the muted recent MLB landscape, and Seidler’s refreshing, fan-friendly tendencies also seem like sound strategic moves in the medium to long term. A lot of teams lose money in a given year, but the results and stories they create with that net loss can pay off in a big way. The Dodgers, for example, have posted plenty of annual losses since the current ownership group took over in 2012. but the franchise they bought for $2 billion was worth $4.075 billion at last check, according to Forbes.
Seidler said he’s not interested in selling the team anytime soon or wants the Padres to stay in his family for generations. But the logic is true. If a team gains a following and maintains it over a long enough period, by any means, for any reasons, we magically stop talking about media markets — when was the last time you heard someone mention the greatness of St. discussing the eternal success of the Cardinals?
And so, subtly defending any team owners unwilling to truly uphold their end of the bargain with the fans, Manfred played the ball on Seidler and the Padres to once again defy the supposed limitations of their market. “The Padres are going to lose money,” he said earlier this month, “but the question is what are you going to do next?”
First, it appears they will extend Manny Machado. After that? Maybe they will try the same with Juan Soto. At some point, we’ll have to stop being so surprised.