"There's no coincidence" - Alex Rodriguez makes feelings known about the impact of Juan Soto's megadeal on baseball business landscape
Last offseason, when Shohei Ohtani was signed to a then-record 10-year, $700 million contract, former Yankees star Alex Rodriguez feared it would hurt the competitive balance in baseball.
A-Rod had the same concerns when another record-breaking deal was signed this offseason, with Juan Soto agreeing to a 15-year, $765 million contract with the New York Mets. This time, he dug deeper, analyzing how broadcasting deals are impacting competitiveness in MLB.
A-Rod and Jason Kelly discussed Soto's record signing on their podcast "The Deal." Rodriguez highlighted impending issues related to regional network deals, which are no longer sustainable for franchises that don't have a big market like the Dodgers or the Yankees.
"There are about five or six teams that are thriving — the haves and have-nots — but the have-nots outnumber the haves significantly among the 30 teams," Alex Rodriguez said. "It's no coincidence that the five teams involved—the Yankees, Mets, Red Sox, Dodgers and Blue Jays—all have very healthy regional sports network deals."
"If you take a step back, baseball, about 25 years ago, made a macro bet that regional sports networks were where the money would be, while the NBA and NFL focused on national TV deals. The NFL’s national TV deal is $110 billion, and the NBA’s is $77 billion. Regional sports networks, however, are now facing significant challenges and are proving to be unsustainable."
Alex Rodriguez feels the upcoming CBA will need to sort out an important issue
The current Collective Bargaining Agreement (CBA) between MLB and the MLB Players Association expires on Dec. 1, 2026. Some of the major discussion points include economic disparity, increased revenue sharing, centralized revenues and salary compression.
Despite the luxury tax thresholds put in place to keep the league competitive, big-market teams like the Dodgers, Yankees and Mets continue to land record-breaking contracts every offseason. Meanwhile, teams like the Pittsburgh Pirates and Miami Marlins suffer from lower revenue, which impairs their ability to pursue big names.
"With a CBA coming up in the next couple of years, I’d watch that very carefully. Some owners, like those of the Dodgers, Mets and Yankees, are thriving, while others, like the owners of the Pirates and Marlins, are left asking, 'How do we compete?'" Alex Rodriguez said.
Competitiveness in any sport is what makes it attractive and worth watching. However, if the bottom feeders have no way to rise to the top, it hurts the value of the league, with only the top earners taking a chunk of the pie from every revenue stream.