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Derek Jeter has the Yankees over a barrel

Posted by Andy on November 9, 2010

Derek Jeter is going to get grossly overpaid by the Yankees. Multiple reports suggest that Jeter will receive a 3-year contract for $15 to $20 million per season. That would put him among the highest-paid players in MLB despite being worth just about 1 win above replacement last year. In each of the 3 previous years, he was worth an average of about 4 wins above replacement, still putting him well below to top echelon of players. (Albert Pujols has been worth about double that, for example.)

However, the Yankees don't have any other good options, other than bringing back Jeter on a big-money, multi-year deal. In brief, here are the reasons:

  • He is the face of the franchise. He is the captain and the symbol of all of their success since 1996. Jeter makes more money in endorsements than any other athlete and his image cannot easily be replaced. Jorge Posada is already too old and ineffective as a player. Andy Pettitte and Mariano Rivera don't have enough face time on camera. Alex Rodriguez is not likable enough and has too much controversy. Mark Teixeira has been in the background to this point and didn't play well enough this season. Robinson Cano has a very low profile. C.C. Sabathia only plays every 5 days. If they lose the face of their franchise, ticket sales will absolutely go down, as will revenue associated with merchandising (Jeter jerseys, etc.) The Yankees will lose far more than $20 million per year if they don't bring Jeter back. Eventually, someone will replace him as the face of the franchise, but since there is no heir apparent, it would be better for Jeter's departure to happen via retirement than walking as a free agent.
  • There are no star shortstops available on the free agent market. If the Yankees were replacing Jeter with someone like Hanley Ramirez or Troy Tulowitzki, their fans would be much more receptive to Jeter's departure, viewing the move as a necessity given the circumstances. But if they now brought in Edgar Renteria or Cesar Izturis to replace Jeter--well that ain't gonna fly.
  • Jeter is going to reach 3,000 hits, almost certainly in 2011 barring a significant injury. (He's currently 74 hits shy.) The Yankees want to take advantage of this event and the corresponding bump in TV ratings and merchandise revenue, rather than having him go to some other team to achieve the feat. Remember, no Yankee has 3,000 hits. Jeter is going to be the first.

So, you better believe it--Jeter will be back and will be grossly overpaid. Hopefully (for him and his team) 2010 was a bit of an aberration and he hasn't fallen quite that far just yet. In 2011, he has a decent shot to post another 3 WAR or so, get 3,000 hits, and then think about moving to left field.

65 Responses to “Derek Jeter has the Yankees over a barrel”

  1. Kevin S. Says:

    Quite honestly, the Yankees don't need a "face of the franchise," because their own brand is so strong that it transcends the individual players, especially if they keep winning. Merchandising isn't as much of an issue for a guy who has been on the team for a decade and a half, because most people who were going to buy Jeter stuff would have already bought it, and again, if Jeter wasn't on the team, they'd probably by the merch of other players. I'm not saying losing Jeter wouldn't be a marketing loss, but it's going to happen sooner or later anyway, and it's hardly going to be a crippling one.

    Until yesterday, I would have agreed with you on replacements, but now that Chiba Lotte is posting Nishioka, the Yankees have an alternative. In fact, they could bid on him merely as leverage against Jeter, and then not sign him if they get agreeable terms worked out with the Captain.

    Finally, I know B-Ref is going to use its own stats, but fWAR significantly disagrees on Jeter's value. There isn't really a consensus that he's a bad player, and there are reasons to believe a positive regression could be coming in 2011, which would mitigate and possibly overcome his decline in true talent level as he gets a year older.

  2. Frank S. Says:

    If the Yankees were replacing Jeter with someone like Hanley Ramirez or Troy Tulowitzki, their fans would be much more receptive to Jeter's departure
    This is most definitely a no. Living in the area, I can honestly say that a vast majority of Yankee fans would be all up in arms if they brought in Hanley or Tulo. This is a lose-lose situation for the Yankees, no two ways around it.

  3. Andy Says:

    I didn't say he's a bad player...

    I think you might underestimate the power of Jeter as the face of the franchise. We (users of this website) are very much a minority in terms of the average baseball fan. The Yankees draw millions of fans across the country thanks in part to a good-looking, apparently clean-living shortstop who has no enemies. He's far, far more recognizable and likable than anybody else on the team, particularly to mass Americans and casual fans in other countries. The Yankees are less concerned about dollars from the hardcore fans and more interested in the hundreds of millions in revenue to be had from the millions of casual fans. Jeter has an unusually strong presence in this regard.

  4. Kevin S. Says:

    The Yankees had a similar figure in the 80s and early 90s, just as beloved as Jeter - Don Mattingly. They drew much worse, not because Donnie wasn't as good a face of the franchise as Jeter, but because they didn't win. If the Yankees keep winning without Jeter they won't suffer a big hit. If they Yankees start losing with Jeter, they will suffer a big hit.

  5. Andy Says:

    There is no comparison between Mattingly and Jeter for several reasons:

    1) The Mattingly era Yankees did not win, except for a wild card appearance in Mattingly's final season.

    2) Jeter is a far more visible and outspoken guy, doing way more interviews (like probably 20 to 30 times more than Mattingly). Mattingly shied away from the limelight.

    3) Mattingly's play had decreased significantly in his final several years in a way that was obvious to all. Jeter's play has declined in a way less obvious to many fans.

    4) Jeter's rank in terms of endorsements and merchandise revenue is far higher than Mattingly ever was at any point in his career. How many national TV commercials did Mattingly ever make? I can only remember one although I'm sure there were a handful of others. Jeter is in dozens.

    Mattingly was beloved, yes, but from a distance, and by the time he retired he was crippled and fans were happy to see him off. No fans are happy at the idea of Derek Jeter leaving. If Jeter retired willingly (like Mattingly), it would be different.

  6. Greg Finley Says:

    Similarily, Babe Ruth's legacy was tarnished because of that season with the Braves.

  7. Evan Says:


    I agree with just about everything you wrote with the possible exception of the conclusion that he will be overpaid. If he is worth X additional dollars (I don't believe any of us are in a position to assign a value to X) to the Yankees business as a whole because of his marketability and not directly baseball related contributions then that has to be considered when evaluating what he is worth to the Yankees (I think a similar situation exists with Ichiro and the Mariners in terms of the value of the Mariners' brand). Clearly there is a strong correlation between on field contributions and salary, but this is only because there is a similar correlation between on field success and team revenues.

    Jeter and his contract become an albatross when his marketing value and/or his contract force the Yankees (as a business) to continue playing him even though playing him is hurting the team because there is a superior option available (assuming this has happened yet, it will be interesting to see whether economic value or performance wins). When this will happen (or if it has already happened) is open for debate.

  8. Dr. Doom Says:


    I agree with Evan. I mean, here's the thing. If the Yankees are going to pay Derek Jeter $15-20 million, and he's worth, as you say "far more than $20 million," then it would be STUPID not to resign him. You can be a purist and believe that the Yankees are only interested in winning. But the Steinbrenners aren't stupid. They know that it's ultimately a business. George just always believed that winning the most made you the most money (he was probably right). So they spend the most, win the most, and make the most. But it IS about money. And if Jeter is a financial asset, then they SHOULD pay him as such, and would be foolish not to. Why send over $20 million dollars of revenue to a second-tier team? If your figures are accurate (and that's a HUGE caveat on my whole comment), then there's no reason they shouldn't keep Jeter, even if it hurts on-field performance.

  9. Kevin S. Says:

    So... you agree that it's the winning that matters? Got it.

    I have yet to see any really evidence (beyond agents lobbying for their clients) that a "face of the franchise" really puts butts in the seats. I have seen a great deal of evidence that primary factors to attendance are area population and affluence, with team success varying how many people show up. Likewise, I have never known anybody to say "I can't miss watching this game, Derek Jeter's in it!" Ratings tend to go up when a team is successful. They tend to go down when a team isn't. Sure, transcendent talents make us tune in (McGwire and Sosa in '98, Bonds any time from '01-'04, Pedro in '99-'00), but Jeter is not and has never been in that class. They will likely get a one-time bump in attendance and ratings as he closes in on 3,000, but I think you vastly overstate the impact that will have, and it's certainly not worth breaking the bank to get.

  10. Andy Says:

    Dr. Doom, I'm not sure what you're arguing. Sounds like we agree. I am not suggesting the Yankees are making a mistake by overpaying Jeter. Maybe you're saying that paying him $20 million is not actually an overpayment, because he's worth that much? I agree with that--the term 'overpayment' refers only to his on-field performance, but his value goes beyond that.

    Of course, Jeter is worth less to other teams--I doubt the Royals would get as much of a bump in revenues and TV ratings if he went there.

  11. Evan Says:

    One more aspect that I left out, but find quite interesting to the Jeter contract issue is that in addition to Jeter being worth more to the Yankees than he is to any other team, the Yankees are worth more to Jeter than any other team would be. That is to say, Jeter's short-term and long-term marketing prospects are better for remaining a career Yankee and thus maximizing his relationship with New York and not tarnishing his image by giving the appearance of chasing money or playing time elsewhere.

  12. MikeD Says:

    It's really hard to define what overpaid means when we're talking about the Yankees. They operate in their own environment of New York and Yankee-dom, a domain where Jeter is king.

    Jeter is a lucky man, to the state the obvious, because he had the good fortune to have his contract end just as he was only 70-some hits short of 3,000, so even as he enters his decline phase, he has a lot of marketing value to the Yankees. He knows that, so he's going to capitalize on it. The Yankees wouldn't keep him around for the additional marketing revenue if he wasn't still a positive on the field, but considering they don't have a clear replacement, he still provides value on the field, and he brings in additional money, they can certainly afford to pay him a lot.

    Their biggest concern shouldn't be paying him somewhere between $15-20 million a year, since that's less than he made last year. Their concern should be the length of the contract. If they can sign him to a three-year deal that would be fine. My guess is Jeter will push for a five year deal. That's the point where the Yankees will draw the line. No team will match the Yankee dollars, and no team will offer more than three years, so they should just offer him the money and a three-year deal and wait for him to sign.

  13. Evan Says:

    Today's NY Times column from Richard Sandomir on this topic quotes Vince Gennaro (credited as being a consultant to various teams) as saying

    “As a nameless, faceless shortstop, I have him worth $10 million to $11 million, but as Derek Jeter, I have him worth about $20 million.”

    That's fairly in line with what Andy mentioned and with other numbers I have heard elsewhere with regard to assigning a value to his skill set and to his net economic contributions.

  14. MikeD Says:

    Kevin S @...We agree on one level. What's most important to the Yankees is putting people in the seats, and they do that through winning and making the playoffs. Since they don't have a replacement for Jeter as of yet, and he still rated positve on the field (the B-R team may not appreciate it, but I'm a bit more a fan of fWAR, although both bWAR and fWAR still had him positive), coming in with a 2.5 fWAR, and rating as the third best SS in the AL. (Yes, we've come a long way, the wrong way, since the days of A-Rod, Jeter, Nomar, Tejada and Vizquel all in their peak). That means they have the better chance right now of winning with Jeter than without.

    The part where we don't agree is on the marketing value. It's not just fans at Yankee Stadium. The Yankees get a piece of the gate on the road, and Jeter is a draw. Yet that's the smallest piece of the business equation, I believe. Jeter is the number-one seller in terms of merchandise at the Stadium, and is a huge seller around MLB. The Yankees get a nice return on that. Once a player retires, that market dives. It will totally tank if he's on another team. More so, the Yankees are going to market the hell of Jeter and 3,000 hits, and that's going to generate a ton of money in additional merchandise. Then they'll be more money coming in around Jeter's eventual retirement season. Even more important is feeding the Yankees regional sports network YES. It was no coincidence that when A-Rod wanted to come back, he went through Goldman Sachs, which is a part owner in YES. They understand A-Rod increases YES ratings, which translates into advertising dollars. The same for Jeter. He makes YES more profitable. And last, the Yankees are very good at marketing their major stars post retirement, weaving them into the fan fabric, and generating additional revenue in events and merchandise, as well as using them to exand the Yankee mythology. Jeter is the replacement to the Mantle, DiMaggio and Berra guys. Only Whitey Ford and Berra are left, and they are going to depend on Jeter, Rivera and company to replace those guys in coming decades. So he is a current business asset and a future one, so they will pay him more than any other team will, and he will deserve it. He also knows that, so he's going to try and get as much as he can here. As I said above, it's not so much what they pay him per year that concerns me. It's for how long. Even if he rebounds slightly, he is still a 36-year-old SS, and history says that's going to be problem.

  15. Johnny Twisto Says:

    The Yankees get a piece of the gate on the road

    I'm not sure that is true anymore, now that revenue sharing exists.

  16. MikeD Says:

    @15, Johnny Twisto. Good point. Not so sure about that myself. That does get back to what I meant to include as my close in the last note. As fans, we can only guess at the total value of Jeter. We can do a better job of figuring out what he's worth as a player. We really have no idea what he's worth to the Yankees beyond a player.

    Jeter does provide value beyond the playing field, and those who believe that can guess at a number, and those who believe that Jeter doesn't provide any value beyond what he does on the field can also only guess at that. The Yankees are best at figuring that out as part of their business. Brian Cashman and Hal Steinbrenner do not appear to be overly sentimental types. They're running a business. If they pay Jeter $20 million next year, it's because they believe he's worth it, both now and in the future.

  17. Matt Y Says:

    This is much ado about nothing IMO. Paying Jeter 15-20 mil a year IS overpaying him for his on-field performance (based on last year), but Jeter's value goes way beyond that as many have noted...and to whoever said Jeter doesn't put people in the seats, that person just doesn't get it. He is the face of the Yankee brand, a brand that has won a lot with Jeter, and that brand is worth a lot around the country in visiting ballparks. It's debatable whether he's a transcendent player or not--I think the person that said he isn't, is perhaps undervalueing Jeter a bit. They draw better than anyone, and Jeter plays a big part in that. Additionally, I'm not ready to put a fork in Jeter yet, I would not be shocked if he comes with a couple 2--4 WAR seasons.

    The issue with his contract is not the money, it's the years as a player as others have noted. They should give him a front-loaded 8-10 year contract --60-80 mil for 3-4 (the 4th year should be a team and player option) years as a player and then another 5-7 years at 4-5 mil a year to stay on with the team in some other capacity bringing the total value of 80-100 mil over 8-10 years. It's years 3-4 as a player that worry me the most, but again, i wouldn't be shocked if Jeter has a couple more above replacement player years in him.

    As for Fangraph and B-R WARs not agreeing --how is that? Jeter's WAR at both sites is around 70, and, if anything, B-R's WAR overvalues Jeter given fangraph WARs tend to be a bit higher....or maybe this was your point?

    Jeter is like wins and RBI's-- Undervalued by sabermetricians, but overvalued by traditionalists. The truth is in the middle.

  18. Matt Y Says:

    Also, and like A-rods contract, if the Yankees are smart, a big bonus will kick in for hit #3000 and smaller bonuses for every hit when he passes hit leaders #8-3-- basically everyone from Yaz (3419) to Aaron (3771). My guess is Jeter players no more than 4 more years and ends up with somewhere between 3450-3650 hits placing him somewhere around 4-6th on all-time list. Also, bigger bonuses should kick in for hit #3500 and when (if) he passes Speaker and Musial. Also, a big bonus should kick in if he gets to Run# 2000 (1685), which he'll likely need a 4th year to do.

    I think another pertinent angle in this is how they treat Jeter in relation to Arod. I remember at the end of the year during an interview Jeter mentioning in a bit of a sacastic way about Arod being signed until he's 50 or something. I suspect Jeter will need to be on the payroll past the end of Arods contract, even if he's not playing the last two years of Arods contract. In 3-4 years Arod will need to be a a DH, a position that Jeter might have to play for a year or two.

  19. Morten Jonsson Says:

    People think Jeter is likable? I had no idea.

  20. dennis Says:

    If I had to compare Jeter to anyone, it woudl be to Cal Ripken jr. Both shortstops, both identified as the face of their franchise, both 3,000 hits or soon to be.....

    The Orioles marketed the hell out of the streak.....and it went on and on and on...Ripken while not as prolific as Jeter, did a lof of interviews especially wqhen he broke Gehrig s 2130 games... pu this name to several books, etc.

    and for a while Ripken was identified with everthing thts identified with everything good about perceived traditional American values.....showing up for work every day, beign part of a strong family. devoted to his wife and kids.

    Jeter has always been focused on achieving atheletic excellence and promoiting Derek Sanderson Jeter. And I ll bet that he kearned.........just abit from Maroah carey on how to do that.

    The yankees will find other selling points for Jeter, some are obvious....some will be deveoped.....but they will resign him. He simply has too much marketing value...and barring anything really bad...he will be a first ballot selection for the HOF.

  21. Matt Y Says:

    Jeter would be of even less value moving to LF IMO. My guess is he plays SS 2 more years and then DH/SS for year and DH's for 1 year....assuming he plays 4 more years. Year 4 will be tricky.

  22. JayT Says:

    The revenue made off of merchandising is overblown because the Yankees make the same amount off of someone buying a Jeter jersey as they do off of someone buying a Pujols jersey. As far as I understand it, all MLB merchandising get's put into a pool that is shared equally between all the teams.

    As far as attendence goes, winning games is the best way to drive attendence. If the Yankees drop below .500 next year with Jeter their attendence will drop. If they make it to the playoffs without Jeter, i would bet their attendence will stay pretty much the same as this year.

    Personally, I think Jeter needs the Yankees way more then the Yankees need Jeter. If he goes to someone like the Giants, there is no way Jeter would get as many endorsements, so the Yankees really should be able to undercut the rest of the league. I don't think they will do that though, because they are the Yankees, and spending $7-9 million more per year then Jeter is worth isn't going to stop them from being competitive, so they might as well just sign him and avoid any bad press, and if he craters they can get a new shortstop next year.

  23. Matt Y Says:

    I agree that Jeter needs the Yankees more than the Yankees need him, but the gap is closer than what you're making it out to be. It might be true that the Yankees make as much off of a Pujols jersey as they do a Jeter jersey, however, what you fail to mention is we're talking about two of the biggest draws in baseball --having Jeter with the Yankees selling those jerseys continues to draw more money into the pool than if the Yankees replace him with Eduardo Nunez. Lowballing Jeter and perhaps fracturing the relationship with something around 10-11 mil over 3 years will serve no good purpose. Again, the truth lies in the middle, and Jeter returning to the Yankees is incredibly mutualistically (there's a nonword for you) beneficial, not only for Jeter, but for the Yankees and baseball. The Yankees paying him say 15-17mil mil a year for 3 years with a 4th year option sounds pretty on target.....and I wouldn't be surprised if they build in another 25-30+mil for 7+ years after he stops playing.

  24. James W Says:

    "Similarily, Babe Ruth's legacy was tarnished because of that season with the Braves"

    I disagree. Only us hardcore fans are even aware in finished his career with the Braves.

  25. JayT Says:

    Oh, I think the Yankees would definitely be stupid to have a bad break with Jeter over ~$10 million or so. And keeping Jeter around does two things for the Yankees:
    1) It gives them the best shortstop on the market. Yeah, Jeter is past his prime and has always been overrated, but I'd still take him any day over Cesar Izturis.
    2) It keeps the fanbase happy. Now, if they dumped Jeter I don't think it would directly affect the Yankee bottom line very much if at all, but it would be bad publicity. And if you make the fans angry too many times, that will affect the bottom line.

    All that being said, if the Yankees offer Jeter $10 million a year and another team offers him $15, Jeter would be wise to take the Yankee offer. Unless of course Jeter just doesn't care about the money, and just cares about having a huge salary for bragging rights.

  26. Greg Finley Says:

    I was being sarcastic with the Ruth remark, of course.

    I think you guys are holding too many things constant. If the Yankees have all the leverage, maybe they can resign him for $4M. But no doubt he'll be less motivated and will perform worse.

    Similarly, the revenue he generates is likely a function of his salary. Few people want a jersey of some fading star that everyone sees as a free rider.

  27. dennis Says:

    in your own words, Jeter has always been overrated.

    pray tell, how so?

  28. BSK Says:

    Not sure I agree. The Yanks will put fans in the seats with or without Jeter, as long as they win. I live in the NY area, born and raised, and can say that lots of things have threatened to drive Yankee fans away in recent years.

    People said they'd stop going if they got ARod... and they still went.
    People said they'd stop going if they lost Clemens and Pettite... and they still went.
    People said they'd stop going if they stopped winning WS... and they still went through a 10 year "drought".
    People said they'd stop going if they overcharged for seats in the new ballpark... and they still went (only the most egregiously overpriced seats didn't sell and those were quickly dropped and sold).
    People said they'd stop going if YES wasn't on Cablevision... and they still went.

    Now, maybe Jeter is above all those things. But people talk a lot. And don't act on nearly as much. If the Yankees field a competitive team and have a generaly likable group of guys, they will be fine. Are there some individuals who might not go to a game who otherwise would have to seen Jeter? Probably. Will those seats remain empty? Not likely.

    While Jeter has an impact beyond his on-the-field performance, we don't want to over-romanticize it.

  29. jason Says:

    i don't think jeter will effectively be moved to another position. i think he'll stay the regular at short until the bitter end of .240 with 5 hr, and then he'll finally be benched and retire. maybe the yanks will be able to get a cheaper contract out of him later on.

  30. ralf Says:

    As far as I can tell, nobody has said the Yankees shouldn't resign Jeter. Everybody knows he's coming back. As noted above, 15-20 mil per year is overpaying him for his on-field performance, but he brings money to the organization in other ways. Is that worth 5-10 mil per year? Could be.

    The 3-year deal seems smart for both sides, especially the Yankees. If he stays healthy he will at least be replacement level (which is obviously not worth that salary to anyone but the Yankees) but by the end of the contract it should be apparent to even casual fans that he's no longer an everyday player. Once the casual fans buy into Jeter's career being nearly over, Jeter and management can organize the farewell tour and he can gracefully ride off into the sunset. And there's a decent chance that he still has a couple of productive seasons left in him.

    Of course, that assumes that 1) Jeter is honest with himself about his declining ability and 2) he doesn't suddenly age so quickly that the talk radio neanderthals turn on him.

  31. AlvaroEspinoza Says:

    How can you say both...

    "Derek Jeter is going to get grossly overpaid by the Yankees"


    "The Yankees will lose far more than $20 million per year if they don't bring Jeter back"?

    Sounds to me like he is getting exactly what he's worth.

  32. Matt Y Says:

    While all largely true BSK, I also think Jeter is actually to some extent above everything you list above. With that said, I agree we shouldn't over-romanticize it. As I see it, keeping Jeter happy for 3-4 more playing years by paying him an extra 6-7 mil a year as he draws in TV ratings while passing 3000hits and other iconic names on the hit list is every bit as much about keeping him in the "inner-Yankee circle" into the Future as anything else. Why risk a Yogi-like failing out for 12 years by shortchanging him 15 mil now (I know that's a ridiculous statement but it's a sign of the times unfortunately). I'm not saying that's going to happen, but paying him an extra 10--15 mil now will pay for itself over the long haul if Jeter's in that inner-circle for the next 30 years.

    Again, as for Jeter being overrated, it always cracks me up how he always polls in the top 5 in most overrated by some circles, but also for many years polled in the top 5 for players that a manager would most want to have to start a team. Again, the truth lies in the middle --he is underrated by sabermetricians and a bit overrated by more traditional types.

  33. Matt Y Says:

    I also don't think Jeter will hang on if he becomes too much of a shell of himself, so I disagree #29. Jeter had a bad year, compared to his Hall-like years, but he still had a decent year for any average major league SS (3rd best). I think he'll be fine for another 2 years, but years 3 and 4 make me a bit nervous, especially year 4 if he gets ayear 4. I can see the Yankees offering 3 years and Jeter wanting 5 years and everyone settling on some type of contract for 4 years.

  34. BSK Says:

    Matt Y-

    Jeter is likely bigger than any of those things individually (and probably some of them combined, though not the entire lot). I still don't know it's enough to conclude that he will have a noticeable difference on revenue and attendance. If it gets really ugly, that MIGHT exacerbate it, but that is another story entirely.

    I do think there is value to Jeter beyond what he does on the field. I won't wade into what he is worth off-the-field, but it is likely more than he is worth on-the-field and likely more than just about any other player off-the-field. There is no denying that. I just think we should avoid the doom-and-gloom scenarios that some (not necessarily Andy) are forecasting. The Yankees will be fine, with or without Jeter. Will they be better with him? In the short term, probably. Even if it costs $20 a mil? More likely than not. But will they survive without him? Most assuredly. Especially if they win.

    It will be interesting should he leave AND they struggle on the field. I doubt the former would really influence the latter, but it'd be fun to watch everyone insist that it does!

  35. Matt Y Says:

    I agree for the most part BSK, but I do however think there is some difference in revenue b/w Yanks with Jeter and Yanks without Jeter. How much, only they know.

  36. Andy Says:

    AlvaroEspizona, as I said in comment #10 above, he'd be grossly overpaid relative to his on-field performance, but agreed not necessarily with regards to his overall value.

    As for merchandise revenues, in #22, I believe each team has a home geographical market where they get the lion's share of revenue from sales of stuff featuring their own team. They share with the other teams such sales outside of their geographical area. So, this means that when the Yankees sell a Jeter jersey in NY, parts of NJ, CT, etc, they get the bulk of that money, but when they sell one in St. Louis they effectively split that with all the other teams. Similarly, they get a cut of Pujols jerseys sold in NY while the Cardinals get a lot more for selling one in St. Louis.

    The Red Sox raised a big stink about this when they signed Matsuzaka, saying that Japanese sales should go to the Red Sox but MLB ruling that Japan is outside their geographical area and therefore all Daisuke jersey (etc) sales in Japan were to be split evenly among MLB teams.

  37. dodgerdave Says:

    Not like it matters, but I just realized right now that Jeter ranks 33rd all-time in strikeouts with 1572.

  38. Matt Y Says:

    #37, he strikes out a fair amount for a 1-2 hitter, but this is more reflection of today's high strikeout environment.

  39. BSK Says:

    Matt Y-

    There is a difference, I'm sure. I doubt it is enough to factor into the negotations. There is a lot more at stake than a few million dollars in merchandise or gate revenue. Well, that is a bit of hyperbole. On the field, what is at stake is the difference between Jeter and his replacement. Off the field, there is some emotional equity to consider. The financial impact is still an impact, but likely the third most relevant one.

    I do wonder if the Yankees really know. If there is any data that can lead to reasonable projections or if it's just a crapshoot. So many variable imply it'd be nearly impossible to predict, BUT, I know nothing about finance, so perhaps there are folks smart enough to do just that.

  40. Matt Y Says:

    Assuming he averages 165 hits and 85 runs (these are both below his career averages of 119 runs and 207 hits over 162 games) across the next 3 years, he'll be within 100 hits of 3500 and Speaker 5th all-time at 3514--he could also also be 65 runs from 2000. If it's a possibility, I can see them giving him a 4th year to cash in on these events. This last year he managed to muster 179 hits and 111 runs. I also see him being dropped in the order sometime next year or following year, and this will cut down on his hits and runs. He does seem to have legitimate shot at making a run at 3500 hits and 2000 runs --if he did he'd join a pretty elite group of Rose, Cobb and Aaron as the only players ever to do so.

  41. steve d Says:

    he would have had them over a bigger barrel had they won the world series.

  42. JayT Says:

    Since he signed his big contract, Jeter has been one of the six best paid players in the league but never been in the top five in war, and only in the top ten four times.

    He wins Gold Gloves even though he has just about the worst range of any shortstop in the league.

    I'm not saying he isn't good. You can be Hall of Fame worthy and overrated.

    How badly did the falling out with Yogi hurt the Yankees? Maybe they lost a few fans to the Mets, but he came back, and very few people even remember there was a falling out. And I would say that Togi was even more loved then Jeter is.

  43. Dave Says:

    He also should have won two MVP awards. So on one hand they give him meaningless GGs, but screwed him out of two MVPs. Ask Jeter would he rather have won one MVP or five gold gloves?

  44. Johnny Twisto Says:

    Which two? He had a legitimate case in '99, '06, and '09, but in none of those years was he clearly the most deserving. I would disagree he has been "screwed" out of the MVP.

    (He also came close in '98, but I don't remember thinking at the time that he really had a strong case to win. I might think differently if I studied it closer.)

  45. MikeD Says:

    @42, JayT -- Overrated is an overrated word. Jeter in some ways is both overrated and underrated. In the traditional media, he received such hype that one can argue that he's overrated, even though he's deservedly heading toward a first-ballot HOF entry. Yet among the sabremetric crowd he's underrated, simply because they constantly argue about how he's overrated, which means they've lost track of how good he is, making him underrated.

  46. OldYanksFan Says:

    All merchandising monies are split... except stuff sold AT the stadium.
    The Yanks should offer Jeter 3/$40. It is still overpaying him based on his on-field value (what kind of SS do you think he plays in 2012 and 2013? Scary thought), so he is still getting the 'I'm Derek Jeter' bonus.

    What will Jeter do if he's insulted? Play for the Giants for 2/$20?
    Just what team do you think gives him $30m?
    Jeter is a team first guy, right? A lifetime Yankee? One who has made over $200m in his career (10% of it only because of ARod's contract).

    What do you think would happen to Jeter's legacy if he left the Yankees because they ONLY offered him FORTY MILLION DOLLARS for his years 37-38-39?

    I saw Mantle retire, Murcer get traded, Munson die and Mattingly retire.
    Fans will come whether Jeter is there or not.
    The Yankees are famous worldwide because they are the team of Babe Ruth and Mickey Mantle... Jeter is just the current face, but he ain't bigger then the Yanks.

    And I think he will be better next year (he almost has to be), but if his last 3 years are anything like 2010, fans will be calling for him to be benched, and blasting Cashman for wasting valuable resources.

    How many people called for his to be dropped to 9th in the order this year. Imagine if he has another 3 years of similar production while making a King's ransom.

    A $60m contract has a good chance of hurting his legacy, as it hurts the team. It could be viewed as a historically foolhardy contract.

  47. JayT Says:

    @45, MikeD
    I don't think the sabremetric crowd has every really underrated him though. Can you point to anyone prominant in the stats-oriented community that doesn't think Jeter is a Hall of Famer?

  48. Joel Says:

    I think Jeter should get 7 years $100 million. Do you know why? Because I hate the Yankees that much. I want him to hold them hostage and cost them Cliff Lee. Of course, we know this won't happen. It won't happen because Captain Intangibles will heroically only ask for 4 years/$84 and the Press will slobber all over him just as Arod slobbers all over his reflection.

    Congrats on the golden glove, Jeter. You really earned it. Of course, you realize I am referring to his 2011 Gold Glove. Why not? He's famous and wins. That's what Gold Gloves are for.

  49. Joel Says:

    On a more serious note, as I respect the content of this site, I will say that Jeter's value as a player in terms of his 'drawing power' is limited but the negative impact of showing up a Yankee legend would be catastrophic. Nobody would be loyal to this team and future impact free agents would be more likely to balk.

    It is that, and that alone, that will keep Jeter in his uniform. The Yankees most likely know the 'drawing power' of the Yankees, to those disgusting un-showered bandwagon baboons, is the rings, baby - not Derek Jeter. Yet it won't matter because it's bad business to slap a legend in the face.

  50. Bill Madlock Says:

    I've read several comments here and there are several good points. Jeter will re-sign with the yankees and make a ridiculous amount of 15 million dollars..(based on his declining skills and susceptibility to hitting into double plays) he is worth rougly about 8 or 9 million. As for the argument that off the field (endorsements, merchandising, etc.) Jeter earns his possible 15 million is just dumb. A player is paid solely for his on field performance. Everyone here has also missed that fact that Jeter can't catch up to a fastball anymore as he cheats with his hips and has compromised his stance...his stance used to be with the bat all the way up to his head with a slight wiggle, now he's lowered the bat and his body teeters in the box (like a see-saw), he's protecting against the fastball, and now he is so vulnerable to an off-speed pitch. As soon as the league figures this out, Jeter will quickly become a .250 hitter...he may sign a three-year deal but they won't get one productive season out of him. He's worth 8 million. If Jeter sees that he is not performing up this standards he will probably just walk away (like DiMaggio).

  51. Says:

    I am a huge Yankee fan. I am a bigger Derek Jeter fan. The Yankees have plenty of money and Jeter makes them more than he costs them. So who cares if they give him a truck load of money. If they don't give him every penny he asks for I'll be pissed off as a fan. They could give him 30 million a year and it wouldn't hurt anyone. Either way is is going to be in the starting lineup for years to come, so take a deep breath and don't worry about if he is the highest paid player or making the league minimum. It makes no difference.

  52. Matt Y Says:

    By virtue of constantly being railed on by the sabercrowd, Jeter is clearly undervalued by sabermetricians (i.e the net-o play)....... and is overvalued by traditionalists. Again, Jeter is like wins and championships, stats that are overrated by traditionalist, but underrated by sabermetricians. The truth is in the middle. If Jeter had finished his career with a WAR of 59 (say he retired after 2007) , the sabercrowd would have voted no, whereas anyone else with a pulse would vote yes. Again, the truth is in the middle.

  53. Mike Felber Says:

    59 might have gotten him in even w/SM guys. Their perception of him is pretty much on target. As a HOD player over a reasonable length career, but his very limited range limits his value to a degree.

    Arguments are reasonable on either side re: what he should make. If a player does mean a lot of revenue, especially if he has been a galvanizing force & leader for years, I favor paying him more than any comparable on field player. But to a degree-the best thing would be for Jeter to take, say, 12-13 M, & insist upon an incentive clause that could pay him up to ~50% more if he hits what is the equivalent of a 5 WAR performance. That would be a stand up/team thing that would enhance his image, & set a good precedent/example.

    Odds are pretty tiny that will happen. Also, I do not think that him passing players in hits after 3K will make much of a difference to fans.

  54. Biff Says:

    "Jorge Posada is already too old and ineffective as a player."
    One current bad contract.

    A.J. Burnett (not mentioned)
    Two current bad contracts.

    Considering the lengths of Teixiera, Rodriguez, and Sabathia's deals you have 5 current bad contracts, because those guys won't be stars when close to the time the deals are up.

    Throw in a few guys named Contreras, Wright, Pavano, Igawa, and Irabu (all who proudly served earning Yankee dollars during Jeter's tenure just to name a few).

    Then try to convince yourself that the Yankees have a budget and just won't be able to afford to sign Derek Jeter.

    Actually, 3 years for 60 million for Jeter is a steal under the circumstances.

    Now imagine a perfect world where even 20 out of 30 MLB teams can get away with this crap and not just (maybe) 5. They day I hear, "The Yankees are going to end up losing ___ ____ at the deadline or to free agency because they can't afford to keep him" is the day Biff becomes my real name.

  55. Doug B Says:

    ha ha.

    any team dumb enough to offer a shortstop only slightly above replacement level $50 million over 3 years should not be complaining about a luxury tax. that's what Jeter will be over the next 3 years... maybe 1 win above replacement level per season. He's JJ Hardy with less power and more batting average and a ton of marketing potential. Anyone want to offer Mr. Hardy $50 million? $30 million? $15 million (now we're gretting there). So if he's worth $15 million for his play, is the marketing potential worth $35 million to the Yankees? If so... I now understand the drafting of Tim Tebow.

  56. Doug B Says:

    also... know this, Derek Jeter makes a lot of endorsement money simply by being a Yankee. If he were to join the Detroit Tigers how much do you think Jeter would lose in endorsement money over the life of a 3-year contract? $10,000,000? So he's got skin in the game to re-up with the Yanks also.

  57. Ian Says:

    If the Yankees will lose far more than Jeter's contract is worth, as you point out, how is that overpaying?

  58. Andy Says:

    This is the last time I'm going to say this. I meant overpaying in terms of his on-field performance. From a stats perspective, Jeter's not worth more than maybe $7-8 million per season. His overall value to the Yankees, though, is likely a lot more than that and he probably would not be overpaid at $15 million per season.

  59. miken Says:

    They could move ARod to shortstop.

  60. Doug B Says:

    If the Yankees offered 3 years $30,000,000 and Jeter turned it down they could let him walk.

    He won't get more somewhere else. The franchise survives just fine even if an aging star with eroding skills comes back to have 1 or 2 good seasons. Every team knows it's better to let a guy go 1 year too early then keep him too long. And in Jeter's case... it may already have been 1 year too long.

    The Yanks could use that $30,000,000 and sign a better player.

  61. Johnny Twisto Says:

    They could move ARod to shortstop.

    They could, but it wouldn't be a very good idea.

  62. Chuck Says:

    The Yankees gave Jorge Posada a four year contract in his age 36 season, which is where Jeter is now.

    The Yankees gave ARod ten years AFTER he opted out of a ten year contract, a contract which will pay him MORE than Jeter will make until he's 42.

    ARod will be HOF eligible before his contract expires, and people are bitching about Jeter?

    Raise your hand if you think the Yankees wish they still had Austin Jackson and Ian Kennedy?

    Thought so.

    The Yankees gave a ten year ML veteran who had NEVER made an All Star team a four year $62 million contract?

    And don't even get me started on Cliff Lee and Jesus Montero.

    Anyone with even the remotest clue about baseball knows the Yankees have many more problems facing them than Derek Jeter's contract.

    Yet Derek Jeter's contract is all we hear about.

    Why is that?

  63. dennis Says:

    A thought would be for the yankees to offer Jeter a choice of two contracts

    1. A one year contract with a fixed sum for 12 to 14,000,000 .
    2. a one year contract for 10,000,000 but with performance clauses that make it worth a maximum of 20 million.

    And potentially a new contract for 2011. .

    In other words let him prove that 2010 was an off eyar (for him) and he still has a couple of great years left.

    And if he walks. i dont think any other team will give him 12,000,000, he will have to take less and chase glory in a different stadium.

    For the Yankees, the two important things are too keep the contract at one year and to keep Derek in pinstrips for his 3,000 hit. And the other milestones really dont matter.....very people care if he gets more career hits then Paul Molitor or Eddie Collins.

    All of us remember Roberto Alomar, who was finished at 36.....a great player who was on track for 3,000 hits and the HOF and he declined so rapildy. He should make the HOF next year, but never got to 3,000 hits.
    And that s an instructive example.....
    Derek may scream

    After all my years as a Yankee, you re disrespecting me!

    I cant imagine a 12,000,000 contract to be disrepectful . If the yankees have some courage, they might have Derek over a barrel. And if he doesnt want the one year contract thery can go out and buy a qua lity shortstop. And just about anybody would be very happy to play for the Yankees.

  64. Marc Says:

    While Jeter has been a star for many seasons I do agree with the initial argument that he will end up being over paid by the Yankees. He is worth a lot to the franchise in terms of face value and merchandise revenue but the multi-millions he will most likely receive will be hard to really justify.

    On the same side of the coin I am a New Yorker and a Yankee fan and I would like to see Jeter stay in pinstripes. Plus i own a lot of Yankee clothing items and I just ordered a new Jeter jersey from and id like to wear it to the games next season. Guess we'll just have to wait and see...

  65. Cabriael Says:

    Jeter might be overpaid, but the average umpire is paid about $150,000 which is grossly overpaid.

    Just sack all umpires and replace them by replays. People will still come to pay money to see Jeter. People will not want to pay for shoddy umpire's retirement fund.