MLB-Japanese Baseball Rule Changes Will Force $100 M on Tanaka

On the eve of the bidding war for Japanese phenom Masahiro Tanaka, Major League Baseball and the Japanese baseball establishment entered into an agreement that will have the net effect of vastly increasing the riches to be paid upon Tanaka, at the expense of his soon to be former team, the Rakuten Golden Eagles.

As I previously discussed, the scene was prime for a record setting payment, perhaps exceeding $60 M, to be paid to Rakuten by the MLB team outbidding all others for the rights to try to sign Tanaka. The record stands now, and likely forever, at $51 M, paid by
the Texas Rangers for the rights to Yu Darvish.

Rather than letting some team (guess who) pay in excess of that figure, US and Japanese baseball entered into an agreement that reverses the whole procedure, letting every team negotiate with Tanaka, and then the winner will owe a sum thereafter to be negotiated with Rauken, but a figure that can now no longer exceed a $20 M cap.

Knowing that they will be saving $30 M or $40 M or even more, the richest of the rich, i.e. the yankees, the Dodgers, perhaps the Angels, perhaps Texas, maybe one other, will be

offering as much as $17 M a year to Tanaka, on a long-term deal that will exceed $100 M.

Rakuen will be taking a second hit as well, as Tanaka reportedly has said that he would use some of his newfound riches to “pay back” Rakuten for all they have done for him, by means of paying for improvements to “the Eagles’ stadium and its facilities for players and fans”. But, the new agreement also prohibits such “donations”, limiting the only benefit that the ex-team can receive to the buy-out fee, referred to as a “Posting” fee.

Still, $20 M is a pretty good payday, especially to such an awful company as Rakuten. Rakuten owns a slew of companies based in the US and they are rife with policies and ownership arrangements that constitute serious conflicts of interest and stretch the concepts of morality and legality to the extreme limits*.

*Rakuten Linkshare is one of the affiliate marketing network giants, but Rakuten also owns many merchant companies, such as Rakuten Shopping (formerly and Kobo, and others, that are merchants on their own network, and affiliate sites, such as One Cause, also on their own networks, giving them unfair advantages in competing against other merchants, and especially against other affiliates. In addition, the industry has long been aware of considerable and uncontroverted evidence that Rakuten-owned affiliate sites, such as One Cause, have been engaged in what is called “Parasite” activity, using software and toolbar devices to override commissions earned by other, non-Rakuten operated affiliates.

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