King Felix's reign didn't even last one month.
On January 19, the Seattle Mariners gave Felix Hernandez a five-year, $78 million contract that was the largest deal ever signed by a pitcher still in his arbitration years. On Thursday, the Detroit Tigers signed their ace, Justin Verlander, who like Hernandez was entering the second of his three arbitration years, to a five-year, $80 million deal. Verlander's contract was clearly modeled on Hernandez's. Not only does it just edge out the total value of Hernandez's pact by $2 million, but both pitchers will earn just under $7 million in the first year of their deals and see their salaries increase to $20 million by the fifth year. The similarity is not inappropriate and proves that Hernandez, the Mariners, and general manager Jack Zduriencik set the market last month.
But even Verlander's deal won't remain the benchmark for long. Tim Lincecum, the Giants two-time Cy Young-winning ace, is up for arbitration, and the fact that Hernandez and Verlander set the market for arb-eligible aces last month is bad news for San Francisco.
The Giants had hoped to sign Lincecum to a puny two-year deal in lieu of an arbitration hearing. He has requested $13 million 2010 salary, an amount that would be a record for a player in his first arbitration year. The Giants have countered with an $8 million offer. Compare that to the $9.5 and $6.9 million figures submitted by Verlander and the Tigers this winter prior to the signing of his contract. Then remember that Verlander was entering his second arbitration year, while Lincecum is entering his first. In 2009, the first arbitration year for both pitchers, Verlander and Hernandez earned $3.675 and $3.8 million, respectively, amounts less than half of the Giants' low-ball offer to Lincecum. Weighing all of that makes it clear that the newly established market for arb-eligible aces has exploded Lincecum's value well beyond even Verlander's new deal.
Prior to Verlander's contract, the Giants could have argued that Hernandez's contract was an outgrowth of his unusual combination of youth (he reached the bigs at 19, won't be 24 until April and his contract will expire before his 29th birthday) and experience (he's already pitched five seasons in the majors). By comparison, Verlander and Lincecum both attended college and were rookies at age 23, the age Hernandez was this past season. But with the 26-year-old Verlander now signed to a more expensive contract that will take him through his age-31 season, the Giants no longer have that weak leg to stand on in negotiations with Lincecum.
All of which reveals just how important timing can be in contract negotiations. Because Hernandez and Verlander set the market before the Giants could settle with Lincecum, the Giants are facing a reality in which nothing short of a nine-figure deal is likely to be enough to buy out Lincecum's remaining arbitration years and/or postpone his free agency.
Meanwhile, the Marlins settled with their 25-year-old ace, Josh Johnson, mere days before Hernandez's deal was announced, and were able to lock him up for four years for just $39 million. Johnson may be a step below Hernandez, Verlander, and Lincecum in terms of his standing in the game, but he did get a bigger deal than either Zack Greinke or Jon Lester did a year ago, and the three of them appeared to set the market for young aces at something just shy of $40 million over four or even five years (Lester signed for $30 million over five years, which, in light of the other four deals signed since, stands as a tremendous bargain).
There is one important difference between the trios of Johnson, Greinke, and Lester and that of Hernandez, Verlander, and Lincecum: health. Johnson (Tommy John surgery) and Greinke (social anxiety disorder) missed nearly all of one season in their young careers, and Lester faced an even greater health issue when he was diagnosed with non-Hodgkin's lymphoma in late 2006. By contrast, Hernandez, Verlander, and Lincecum have each made 30 or more starts in every season but their first, with only Hernandez ever spending any time on the DL (elbow tightness in early 2007 and a sprained ankle in July 2008).
It's not insignificant that Hernandez is the, admittedly minor, exception from the latter group. As impressive as his overall reliability might be, it raised a red flag when I analyzed Hernandez's contract last month. Because he's been so good at such a young age, and paradoxically because he's generally been so healthy, King Felix has thrown 905 innings before his 24th birthday, which is a ton for a pitcher so young. Since 1970 only four pitchers have thrown more major league innings prior to the age of 24, only one of whom, Bert Blyleven, avoided a premature decline in effectiveness (the other three were Dwight Gooden, Frank Tanana, and Fernando Valenzuela). In 2009, Hernandez threw 238 2/3 innings at age 23.
Including 2006, when his season was extended by Detroit's run to the World Series, Verlander has thrown 200 or more innings in all four of his major league seasons. Only two of those years came prior to his 25th birthday (the age of 25 represents the upper boundary of what is known as the "injury nexus" for young pitchers, whose bodies are still developing), and he didn't pass 210 innings until this past season at age 26.
Lincecum, meanwhile, turned 25 in the first half of the 2009 season after throwing 146 1/3 and 227 innings in his first two major league campaigns, respectively. Thus in the context of innings pitched relative to age, Hernandez's youth is a disadvantage, while Verlander and Lincecum seem more likely to stay healthy for the length of their contracts, which will help justify their sizable salaries.
All of which still fails to take into account the actual on-field performances of the pitchers in question. Hernandez, Verlander, and Lincecum all possess dominant, head-spinning stuff and have shown the ability to translate that raw ability into actual, season-long dominance on the mound. Yet, prior to last season, Hernandez had never made an All-Star team, received a Cy Young vote, or posted an ERA below 3.45 over a full season. He's only now reaching the level of physical and mental maturity required for true major league dominance, so his underwhelming (relative to his hype, that is) performance prior 2009 must be viewed through the lens of his age at the time.
Verlander, meanwhile, was Rookie of the Year for a pennant-winning team in 2006, an All-Star in 2007, and received Cy Young votes both seasons before returning to the All-Star game and finishing third in the Cy Young voting behind Greinke and Hernandez in 2009. Verlander still hasn't posted an ERA below 3.45 in the majors, but his 4.27 K/BB ratio in 2009 far exceeded Hernandez's career-best 3.11 K/BB from 2007. He has done more than Hernandez has to earn his ace designation, but he nonetheless had a legitimately discouraging 2008 campaign that saw his ERA swell to 4.84 and his K/BB dip all the way down to 1.87. Those struggles actually carried over into his first four starts of 2009 (0-2, 9.00 ERA, 5.25 IP/GS), but in the 219 innings that followed, Verlander posted a 2.92 ERA and struck out 244 men against 54 walks (4.52 K/BB). Still, there's been enough variability in his performance over the last two seasons to give one just the slightest pause before praising him as one of the games reliably dominant aces.
Then there's Lincecum, who has been nothing but brilliant since his rookie season of 2007. Since getting his feet wet with 146 1/3 above-average innings that year, he has been an All-Star and the NL Cy Young award winner in each of the last two seasons, going a combined 33-12 for a terrible offensive team, posting a 2.55 ERA in 452 1/3 innings in which he has struck out 526 batters (10.5 K/9 with a 3.46 K/BB). Though some concerns about the diminutive physical stature of the 5'11", 160-pound righty linger, they've proven unfounded thus far. Lincecum hasn't gotten any extra help from his defense or lucky breaks on balls in play over the last two seasons, and his 2009 was even better than his first Cy Young season of 2008. There's no chink in his armor. He's a 25-year-old superstar and he's going to get paid like one in 2010 one way or another, and when he does, he'll have Hernandez, Verlander and their teams to thank.