Dan Shaughnessy, who long ago did his heel turn, had already blasted the club’s ownership for the penny pinching ways, when Red Sox GM compounded the complaints with a text book salary dump sending designated starting shortstop Marco Scutaro to the Colorado Rockies for righty Clayton Mortensen.

The move perplexes Rob Neyer. And the overall tenor of the offseason has largely upset legions of Red Sox Nation. The acquisition of Andrew Bailey being the primary positive among a sea of head scratchers.

But the tactics are not designed to construct a playoff roster. They are designed to avoid the newly sterner luxury tax penalties as spelled out in MLB’s new collective bargaining agreement. The Biz of Baseball’s Maury Brown touched on this topic when the new CBA was announced in November:

The Competitive Balance Tax (CBT), or as it’s commonly known as the Luxury Tax that has been part of MLB, stopped at the end of the season. It’s back in the new agreement, with some undefined tweaks. In a sign that the players are happy with where the model currently is, the soft cap for the league will see no changes in the threshold from the 2011 season -- $178 million based on end-of-year salaries

The quiet offseasons that both the Red Sox and Yankees have overseen suggest both clubs find the new provisions onerous enough to pull back from their free-spending ways. The Yankees big splash came in two pieces just over a week ago. First they dealt Jesus Montero and Hector Noesi for Michael Pineda and minor leaguer Jose Campos. Then they announced an agreement with Hiroki Kuroda on a one-year contract for the budget conscious price tag of $10 million.

Still, the Red Sox and Yankees both face the prospect of exceeding the tax threshold in 2012. The Yankees certainly will. Boston is working like crazy to prevent that.

Speculation centers around Roy Oswalt. The Red Sox would not have been able to sign the veteran right handed starter, even at his reduced salary demand of one-year and $8 million unless they moved some salary. Thus exits Scutaro.

Among the agida inducing activities Cherrington continues to deal with is the club’s full slate of players facing salary arbitration. And with David Ortiz seeking $16.5 million the Red Sox were looking at an even greater cash crunch.

They settled one of their cases last night, with an announcement sent out minutes after the trade was officially announced. Right-handed reliever Daniel Bard agreed with the team on a one-year deal for the $1.6125 million. The two met int he middle between Bard’s asking price of $1.825 million and the club’s offer of $1.4 million. The contract represents a raise of 219.3% over his 2011 salary. He qualified as a Super Two player.

Bard is a candidate to start for the Red Sox in 2012 after serving as the club’s primary set up for Jonathan Papelbon since joining the team in mid-May of 2009. He and Alfredo Aceves, who is also poised to go to an arbitration hearing, are both looking to shift from the pen to a starting role. Picking up Oswalt would ensure one, if not both, would be back in the bullpen next year.

Joe Tetreault is a contributor to the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey. He can be contacted here through The Biz of Baseball

Follow Joe Tetreault on Twitter

Follow The Biz of Baseball on Twitter

Follow the Business of Sports Network on Facebook

Yu Darvish has been signed with the Rangers. Here's the breakdown

With 5 minutes left before the deadline to get him signed, agent Arn Tellem and the Texas Rangers agreed on a six-year, $56 million deal that sees $49 million of it guaranteed and the 2017 salary of $11 million a player option based on certain awards. According to Cot’s Contracts, that player option kicks in if 1) Darvish wins the Cy Young in 2012-16 or 2) 2nd in voting once in another season for 2012-16 and finishes 2nd-4th in two other seasons 2012-16.

To add, he gets a roster bonus of $800,000 annually if he stays off the DL. If he’s on the DL more than 30 days, the $800K is reduced by $5,228.75 per day starting on Day 31.

He gets some standard boilerplate award provisions, as well. Darvish gets $50,000 each for AL ROY, All-Star. $100,000 for Gold Glove, LCS MVP. $150,000 for World Series MVP, $250,000 ea for AL MVP or Cy Young ($200,000 if 2nd if either voting category, $150,000 for 3rd, $100,000 for 4th, $50,000 for 5th)

Here’s the salary break down

• 2012 - $5.5M
• 2013 - $9.5M
• 2014 - $10M
• 2015 - $10M
• 2016 - $10M
• 2017 - $11M (player option based on Cy Young voting)

Confused? There’s more.

There’s the posting fee.

By tomorrow, the Rangers will have had to have made the $51,703,411 posting fee payment to the Nippon Fighting Hams, a new record high. It’s how that money moves around on the books that is interesting.

The posting fee money does not count toward player payroll, which is key as the Rangers had a player payroll at the end of the 2011 season in excess of $106 million. Because the posting fee money does not count as player payroll, it’s not counted against the CBT (or, as it’s more commonly known, the Luxury Tax).

Evan Grant of the Dallas Morning News reported that the fee will be amortized over 6 years, which brings the $52 million fee down over time.

From an ownership perspective, Darvish is both an asset and a liability. The difference is in how the money is placed in the ledger.

If the posting fee were connected to the contract and that amortized payment moved out over the 6-years with the guaranteed money, he would be more difficult to move if the Rangers saw fit. That $10 million a year at the end of the contract looks more far forgiving that $16 or $17 million.

As one sports exec said of the posting fee being attached to the contract or not is “fungible” from an ownership perspective.

On paper, Darvish comes off eye-popping at possibly $111 million. The 2017 player option year allows for Darvish to opt out if he hits all the marks. The posting fee is also a massive write-off, which lowers its true cost further.

It’s enough to make your head swim, especially when you consider this: Yu Darvish’s current Major League Service Time is 0.000.
RELATED CONTENT
Demystifying the Posting System for Japanese Players Entering MLB

Maury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey. He writes for Baseball Prospectus and is a contributor to Forbes SportsMoney blog.. He is available as a freelance writer. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network (select his name in the dropdown provided).

Follow Maury Brown on Twitter

Follow The Biz of Baseball on Twitter

Follow the Business of Sports Network on Facebook

File this one in the “broken record” department: prepare for yet another season of MLB’s blackout policy remaining in place.

The reason for the broken record? This story has been written repeatedly for years. A source at MLB said that for all practical purposes, the matter will likely not be addressed for the upcoming season.

For the uninitiated, the question is, “Why should I be concerned?” That depends on whether you are, or planning to, purchase MLB Extra Innings or subscribe to MLB.TV.

In a nutshell, there are two ways you can be hit with the “blackout blues”. National broadcast partners FOX and ESPN have exclusivity agreements in which no matter where you live, games are blacked out on MLB Extra Innings and MLB.TV.

There’s also local blackouts depending on your location that can impact one, or up to as many as six teams being blacked out in your location.

See the map below for MLB’s television territories:

Here’s how DirecTV defines the blackout policy:

All local and national blackout restrictions still apply. In other words, subscribers within a club's Home Television Territory cannot get that clubs’ games in this national package. In addition, due to the national exclusivity of both FOX and ESPN, there are no games available for distribution via this package on Saturday day or Sunday night, respectively.

If you live in a ZIP code that is within a Major League Baseball team's territory, that team's games will be blacked out from the MLB EXTRA INNINGS game package, but will generally be available as part of your regional sports network or team's over-the-air affiliate television station. Blackouts protect the local rightsholders who arrange separate distribution agreements with the teams for their exclusive territories

Maybe this will change, but DirecTV has historically provided no zip code locator to allow you to see whether you’re blacked out.

While MLB.com has fine print in a light font on a white page for MLB.TV’s blackout restrictions (scroll to the bottom of this page), at least they provide more details (and this is important) two methods that allow you to see what games you are going to be blacked out for. DirecTV users, this may be where you save yourself some grief (and possibly money) by using MLB’s information to determine whether to shell out around $200 for a first-time Extra Innings subscriber.

MLB adds this information on local blackouts, as well, on their MLB.TV page:

All live games on MLB.TV and available through MLB.com At Bat are subject to local blackouts. Such live games will be blacked out in each applicable Club's home television territory, regardless of whether that Club is playing at home or away. If a game is blacked out in an area, it is not available for live game viewing. If you are an MLB.TV Premium subscriber and not within either Club's home television territory, the applicable game will be available as an archived game as soon as possible after the conclusion of the game. If you are an MLB.TV Premium subscriber within either Club's home television territory or an MLB.TV subscriber in any territory, the applicable game will be available as an archived game approximately 90 minutes after the conclusion of the game. Archived games are not available through MLB.com At Bat.

In addition, note:

•  
  • These blackout restrictions apply regardless of whether a Club is home or away and regardless of whether or not a game is televised in a Club's home television territory.
  • All live Toronto Blue Jays games are blacked out throughout the entire country of Canada.
  • Additional teams may also be subject to blackout in parts of Canada based on their region.
  • All live games will be blacked out in the U.S. territories of Guam and the U.S. Virgin Islands during the MLB regular season.

Remember, this is for Monday-Friday. The weekend is where matters change dramatically.

ESPN SATURDAY AND FOX SUNDAY NATIONALBLACKOUTS

MLB gives this information on how ESPN’s and FOX’s national blackout deal works. FOX holds the rights to Saturday games, while ESPN gets games in the evening on Sundays.

Due to Major League Baseball exclusivities, live games occurring each Saturday with a scheduled start time after 1:10 PM ET or before 7:05 PM ET and each Sunday with a scheduled start time after 5:00 PM ET, will be blacked out in the United States (including the territories of Guam and the U.S. Virgin Islands). In addition, in the event of extraordinary circumstances that produce a programming conflict, the above blackout windows may be subject to change. If you are an MLB.TV Premium subscriber outside of the United States, each of these games will be available as an archived game as soon as possible after the conclusion of the applicable game. If you are an MLB.TV Premium Subscriber within the United States or an MLB.TV subscriber in any territory, each of these games will be available as an archived game approximately 90 minutes after the conclusion of the applicable game. Archived games are not available through MLB.com At Bat.

There’s more… What if the season goes beyond 162 games, such as we saw last year with a play-in game?

Regular Season Play-In Game: Due to Major League Baseball exclusivities, any play-in game to determine the final team(s) to reach the MLB Postseason, i.e. a 163rd game, will be blacked out in the United States (including the territories of Guam and the U.S. Virgin Islands).

And, blackouts impact the postseason…

Postseason Live Blackout: Due to Major League Baseball exclusivities, during the MLB Postseason, all live games will be blacked out in the United States (including the territories of Guam and the U.S. Virgin Islands) and Canada. If you are an MLB.TV Premium Subscriber outside of the United States and Canada, each of these games will be available as an archived game as soon as possible after the conclusion of the applicable game. If you are an MLB.TV Premium Subscriber within the United States or Canada or an MLB.TV subscriber in any territory, each of these games will be available as an archived game approximately 90 minutes after the conclusion of the applicable game. Archived games are not available through MLB.com At Bat.

And about the national blackout policy, any chance that happens soon? In speaking with sources close to the matter, when asked if the possibility it won't be considered until contracts are renewed with ESPN and FOX, the reply was, "Probably."

Maury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey. He writes for Baseball Prospectus and is a contributor to Forbes SportsMoney blog.. He is available as a freelance writer. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network (select his name in the dropdown provided).

Follow Maury Brown on Twitter

Follow The Biz of Baseball on Twitter

Follow the Business of Sports Network on Facebook

Orioles Ink Johnson, but swap figures with their other arbitration eligible players

Dan Connolly tweeted word of Jim Johnson's one year, $2.625 million agreement with the Orioles on Arbitration Deadline Day. The righthanded reliever's new deal represents a 169.2% raise over his 2011 salary of $975,000. In his age 28 season, Johnson posted career bests in innings, strikeouts, wins and most peripheral stats, such as WHIP, BB/9, H/9 and K/9.

Baltimore couldn't settle on terms with Brad Bergesen, Jeremy Guthrie, Adam Jones or Robert Andino. Details of the contract figures each player exchanged with the club will be posted shortly.

Red Sox agree with Ellsbury and Aviles at the Deadline

The Red Sox had the largest number of arbitration eligible players among AL Teams with 8. Additionally, David Ortiz accepted the club's offer of arbitration rather than explore free agency.

AL MVP runner up Jacoby Ellsbury was eligible for arbitration for the second time. The Red Sox and their star centerfielder worked out a $8.05 million contract for 2012, as tweeted by MLB Trade Rumors' Ben Nicholson-Smith. His salary for the coming season represents a 235.4% raise over his 2011 compensation of $2.4 million.

The Boston Herald's John Tomase has details of infielder Mike Aviles one-year $1.2 million contract. Aviles was in his first year of eligibility for arbitration and saw his salary nearly double from 2011's $640,000.

Boston had previously announced the signings of lefty reliever Franklin Morales, catcher Jarrod Saltamacchia and recently acquired outfielder Ryan Sweeney.

Ortiz and a trio of right-handed pitchers - Alfredo Aceves, Andrew Bailey and Daniel Bard - are the remaining unsigned Red Sox players eligible for salary arbitration.

Yankees sign Robertson, Chamberlain

CBS sports' Jon Heyman has details for both deals the Yankees worked out at yesterday's deadline with right handed pitchers Joba Chamberlain and David Robertson. For Chamberlain he and the club agreed on $1.675 million for next season, up a tick from 2011’s $1.4 million contract. Robertson will get $1.6 million with another $25,000 possible in incentives. His guaranteed salary represents a 247.8% raise over what he made in 2011, his final season prior to arbitration eligibility.

Previously, Phil Hughes's agency, CAA announced via twitter that their client and the Yankees agreed on a $3.2 million contract for the coming season.

Outfielder Brett Gardner, catcher Russell Martin and lefty reliever Boone Logan remain unsigned and have exchanged figures with the club.

Rays work out deals with Price, Upton, and Badenhop

In his first year of arbitration eligibility, lefty ace David Price matched the record setting amount the Marlins gave Dontrelle Willis in 2006. He'll make $4.35 million in 2012 on a one-year deal, as initially tweeted by MLB Trade Rumors' Ben Nicholson-Smith. Price had been on a major league contract signed when he was drafted that paid him $1.25 million in its final year. His salary for the coming season represents a 248% raise.

Facing his final salary arbitration go-round, center fielder B.J. Upton settled early and gets $7MM plus playing time incentives, as reported by the Tampa Bay Times' Marc Topkin. Upton had failed to reach an agreement with the club last season and lost his arbitration hearing, receiving a $4.825 million salary for 2011. This year's guaranteed deal is a 45.1% raise for the longest tenured position player with the club.

Topkin also had details on RHP Burke Badenhop's one-year deal with the Rays for $1.075-million. The newly acquired reliever will get a 43.3% raise over the $750,000 he earned in 2011 with the Marlins.

Jeff Niemann remains unsigned and faces a hearing. Rays GM Andrew Friedman has yet to lose an arbitration hearing.

Blue Jays have two hold outs, work out deals with Villanueva, Johnson and Francisco

MLB Trade Rumors' Tim Dierkes reported that the Blue Jays avoided arbitration with second baseman Kelly Johnson, who accepted the club's offer of arbitration after filing for free agency.  Johnson will make $6.375 million next season which is a little under a 9% raise from his 2011 salary. The club also came to terms with outfielder Ben Francisco, whom they picked up from the Phillies for minor leaguer Frank Gailey. Francisco gets $1.5375 million in 2012, a raise of 30.9% over the $1.175 million he made last year.

The club also announced their agreement with reliever Carlos Villanueva on a one year, $2.2775 million contract. Villanueva made $1.415 million last season. He gets a 61.0% raise in his final year of arbitration eligibility.

Outfielder Colby Rasmus signed earlier in the week for $2.7 million in 2012.

Right handed pitchers Brandon Morrow and Casey Janssen failed to agree on deals with the club and face hearings next month.

Continuing coverage of Baseball’s Arbitration Season can be found on the Biz of Baseball.com. The deadline for clubs and players to agree on contracts before submitting figures to a panel of arbiters for hearings to be held in February passed yesterday afternoon at noon eastern time. Biz of Baseball’s Maury Brown posted posted the list of 142 players who filed for arbitration on Saturday. We’ll have continuing updates on the arbitration process through February's hearings.

Joe Tetreault is a contributor to the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey. He can be contacted here through The Biz of Baseball

Follow Joe Tetreault on Twitter

Follow The Biz of Baseball on Twitter

Follow the Business of Sports Network on Facebook

The first 2012 Spring Training exhibition will be held on Wednesday, February 29th in Clearwater, Florida, where the Philadelphia Phillies will host Florida State University, while the first Cactus League game will be in Phoenix, Arizona on Friday, March 2nd, when the Seattle Mariners will visit the Oakland Athletics in a preview of Japan Opening Series 2012, Major League Baseball announced today.

Five Grapefruit League games and four Cactus League games are scheduled for Saturday, March 3rd.  The Boston Red Sox will debut JetBlue Park at Fenway South in Lee County, Florida on Sunday, March 4th, when the club hosts the Minnesota Twins.  The first full slate of action in both Arizona and Florida, involving all 30 Major League Clubs, is Monday, March 5th.

The Mariners and the A’s will complete their Cactus League schedules on Wednesday, March 21st.  Major League Baseball will open its regular season in Tokyo for the fourth time when the A’s and the Mariners participate in Japan Opening Series 2012, a two-game set scheduled for March 28th and 29th.  Japan Opening Series 2012 will be dedicated to assisting in the rebuilding efforts across Japan.

Select exhibition games at Major League and Minor League ballparks will be played from Saturday, March 31st through Wednesday, April 4th.  The Miami Marlins will host the inaugural regular season game at their new downtown ballpark on Wednesday, April 4th, when they will welcome the 2011 World Series Champion St. Louis Cardinals at 7:00 p.m. (ET) on ESPN.  Six games are scheduled for Thursday, April 5th and 10 games are scheduled for Friday, April 6th, with the first full slate of regular season games on Saturday, April 7th.

SELECT READ MORE TO SEE THE COMPLETE 2012 SPRING TRAINING SCHEDULE (Subject to change)

This week in “Last Week in BizBall“, will BAM cooperate with “TV Everywhere”?, plus the tidbits.

MLBAM AND TV EVERYWHERE

In November, in light of World Series TV ratings, I examined the state of MLB national media rights. In a nutshell, the long term national TV ratings trends for MLB’s marquee events (WS, ASG) are down but demand for rights is robust because live sports remains one of the few TV genres still capable of drawing a mass audience. The next round of negotiations for MLB national TV rights will commence this year as the current deals with ESPN, Fox and Turner expire after the 13 season. Despite flat regular season ratings and the aforementioned declining ratings for the WS and ASG, the current rights holders are expected to bid aggressively with Fox and Turner looking for live sports to boost both distribution and subscriber fees for, respectively, FX and TruTV. In addition, the newly minted NBC Sports Network, backed by Comcast’s deep pockets, is in dire need of more popular programming if they are indeed serious about competing with ESPN. MLB’s current national TV deals bring in approximately $700 million annually. The next round of deals is expected to boost that number to approximately $1 billion annually.

The NFL recently concluded negotiations on extensions with ESPN and their over-the-air broadcast partners. A significant component to all those deals is the so-called “TV Everywhere” initiative which allows (or will eventually allow) the league’s media rights holders to deliver games to their customer’s TVs, tablets, PCs, phones and devices that have not yet been imagined. From my November post:

When MLB’s existing national media deals with ESPN, Fox and Turner were negotiated during the middle of the previous decade, they were largely about TV rights. This next round of national media rights negotiations will be about much more than TV as ESPN, TWC and Fox have rolled out “TV Everywhere” offerings. Tim Brosnan, Major League Baseball’s executive vice president of business operations, told the SportsBusiness Journal earlier this year that “TV Everywhere” is one of the factors in the rapidly escalating value of sports programming rights. “The TV Everywhere revolution that we see happening is part of the driver in this increase in sports rights,” “There is value added when content providers can go on a multiplatform basis.”

But, MLB is unique amongst the so-called “big 4” in that TV rights are controlled by MLB while digital rights are controlled by MLBAM. While MLB’s partners are accustomed to, if not irritated by, negotiating separate marketing and media deals for MLB’s TV and digital, this next round of “TV” negotiations will see this issue become much more contentious. The Sports Business Journal’s media reporter John Ourand wrote a column titled, ESPN and MLB are on a TV Everywhere collision course. John notes that MLB.com is booming, bringing in more than $500 million annually, much of that from online subscriptions (MLB.tv). Obviously, BAM doesn’t want to cannibalize their online video offerings. On the other hand, John notes:

But TV Everywhere has reached critical mass. ESPN now has TV Everywhere deals with companies that represent around 40 percent of the country’s pay-TV subscribers, including the two biggest cable operators (Comcast and Time Warner Cable) and the biggest telco (Verizon). More importantly, ESPN has TV Everywhere deals with all the sports leagues with which it does business.

In its upcoming media rights negotiation with MLB, sources say ESPN has made it clear that it plans to make one bid that wraps in linear TV and digital rights. Up until now, that hasn’t been the case. MLB’s current TV partners interested in TV Everywhere have had to cut separate deals with MLBAM to gain those rights, in addition to the bigger deals with MLB for linear TV rights.

MLB has been, far and away, the most successful amongst the “big 4” in capitalizing on digital media. While BAM has endured criticism on a number of fronts; opposition from some clubs with large equity stakes in RSNs over control of local digital rights, the failure to capitalize on “in market” streaming of live games, exerting too much control over club marketing initiatives on team websites, a secondary ticketing deal with StubHub which some clubs believe has cannibalized their primary sales, a monopoly over online video which ignores the reality of how many young fans consume media via blogs and social platforms….ultimately, BAM is worth a reported $ 2 - $3 billion, which contributes handsomely to the value of all 30 franchises. As well, as mentioned, BAM generates $500 million plus in annual revenues (how much of that is returned to the owners annually is a guessing game). The broadband delivered MLB.tv and At Bat mobile app are both hugely successful offerings. And BAM is unquestionably the industry leader in live online video, providing back end streaming and authentication technologies to the likes of MMOD and ESPN3.

But the upcoming negotiations between BAM and ESPN, and the role of digital rights in any resulting partnership, is a signature moment for MLB. The importance of this negotiation goes beyond the amount of dollars that ESPN is willing to pay MLB. As mentioned, there are many other suitors for MLB’s national TV rights. The bigger issue for MLB may be the loss of profile and status amongst sports fans if their games disappear from ESPN. After accepting OLN’s (subsequently Versus and now NBC Sports Net) offer over ESPN’s, the NHL subsequently received significantly less exposure on SportsCenter. Rightly or wrongly, ESPN has enormous influence over the interests and consumption of sports fans. And ESPN is, understandably, decidedly less motivated to provide exposure to a property that they do not own the rights to. Can MLB cut a deal with ESPN without crippling BAM? Can MLB afford to sever their relationship with ESPN over their “TV Everywhere” demands? The role of BAM in MLB remains as interesting as ever.

SELECT READ MORE TO SEE THIS WEEK'S GREAT LIST OF TIDBITS