Shohei Ohtani walked onto the podium at his December press conference in Los Angeles dressed in a blue suit and tie, looking more like a recent Ivy League graduate than the most sought-after athlete in professional sports. But the 29-year-old Japanese star wasn't there to collect a diploma—he was there to unveil a contract that would shatter every known record in sports economics. The Los Angeles Dodgers had just agreed to pay Ohtani an unprecedented $700 million over ten years, making him the first athlete ever to secure a contract worth that staggering sum.
The deal instantly eclipsed the lifetime earnings of soccer icons like Lionel Messi and Cristiano Ronaldo, who have dominated global sports headlines for two decades. Yet outside North America and Japan, many people have never heard of Ohtani. In Europe, Africa, and parts of Latin America, baseball's popularity is limited, and Ohtani's name rarely appears in mainstream media. How, then, did a player relatively unknown in vast swaths of the world become the highest-paid athlete in history? The answer lies in his extraordinary talent, his marketability in Japan, and the ingenuity of a contract structure that benefits both the team and the player.
The Two-Way Superstar
What makes Ohtani truly unique is his ability to excel both as a pitcher and as a hitter. In baseball, players typically specialize in one role: pitchers throw the ball, and hitters (or position players) bat and field. Since Babe Ruth famously transitioned from pitcher to full-time hitter in the 1920s, no player has consistently performed at an elite level in both roles—until Ohtani. In the modern era of highly specialized training and rigorous analytics, Ohtani's dual-threat capability is considered almost impossible. Yet he not only does both; he does them at an MVP-caliber level.
During his six seasons with the Los Angeles Angels, Ohtani won two American League MVP awards (2021 and 2023) and finished in the top five in voting several other times. In 2023, he led the league in home runs (44) and slugging percentage while also posting a 3.14 earned run average as a pitcher with 167 strikeouts. He is the only player in MLB history to be selected as an All-Star both as a pitcher and a hitter. Scouts and executives uniformly call him the most talented player ever to play the game. Dodgers President of Baseball Operations Andrew Friedman said at the press conference, "Shohei is the most talented baseball player who has ever played this game."
The Ridiculous Contract Structure
The $700 million figure is eye-popping, but the reality of how Ohtani will be paid is even more remarkable. Under the agreement, Ohtani will receive only $2 million per year in salary from 2024 to 2033. The remaining $680 million is deferred and will be paid in annual installments of $68 million from 2034 to 2043. This structure is almost unheard of in professional sports. Typically, players want their money upfront, and teams prefer to spread payments for luxury tax purposes. But here, both sides used the deferral to their advantage.
For the Dodgers, deferring the bulk of the salary reduces the team's annual "competitive balance tax" (often referred to as the luxury tax) hit. The tax is calculated based on the average annual value of the contract, but deferrals with a present-value discount can lower the figure. In Ohtani's case, the luxury tax value of the contract is estimated to be around $46 million per year, rather than $70 million. That gives the Dodgers more flexibility to sign other stars while still fielding a powerhouse team around Ohtani.
For Ohtani, the deferred money is less of a concern because he already earns massive income from endorsements. According to Forbes, Ohtani made approximately $50 million in off-field earnings in 2023 alone, with sponsorships from companies like New Balance, Asics, FanDuel, and Japanese brands such as Japan Airlines and Mitsubishi. He is the most marketable athlete in Japan, where he is a national hero comparable to LeBron James in the United States or Kylian Mbappé in France. By deferring his Dodgers salary, Ohtani can also minimize his state income tax in the future, as California's high tax rates affect his present high earnings less.
Why Ohtani Is Worth What He Gets
Objectively, Ohtani's value to the Dodgers extends far beyond his on-field production. He immediately transforms the franchise into a global marketing machine. The Dodgers already have a huge fan base in Southern California, but adding Ohtani opens up Japan and Asia entirely. The team expects a surge in merchandise sales, television ratings, and sponsorship revenue from Japanese companies eager to associate with the star. In 2023, the Angels saw a 60% increase in attendance on days Ohtani pitched, and the Dodgers expect even bigger numbers.
Additionally, Ohtani's unique skill set provides immense strategic flexibility. The Dodgers can field a lineup that includes Ohtani as a designated hitter on days he does not pitch, and as a starting pitcher when needed. This allows the team to carry an extra player on the roster and optimize matchups. Nobody else in the game offers such versatility. When Ohtani is on the mound, he commands a devastating fastball that averages 97 mph, a deadly splitter, and a slider. At the plate, his bat speed and power are among the best in the sport. He is essentially two elite players in one roster spot.
Historical Comparisons and Market Context
To understand the scale of Ohtani's contract, consider other landmark deals. In 2000, Alex Rodriguez signed a 10-year, $252 million contract with the Texas Rangers, which was then a record. Adjusted for inflation, that would be about $440 million today. LeBron James' career earnings from NBA salaries are around $480 million. Patrick Mahomes' 10-year extension with the Kansas City Chiefs is worth up to $503 million. Even Lionel Messi's massive contract with FC Barcelona (prior to his move to Paris Saint-Germain) was reportedly worth around $555 million over four years. Ohtani's $700 million dwarfs them all.
Critics argue that Ohtani's marketability is limited to baseball-centric countries, unlike Messi or Ronaldo, who are known worldwide. Yet his anonymous status in Europe is exactly what makes the contract so fascinating. Ohtani is arguably the best player in a sport that is the undisputed king of North America and Japan, but barely a niche elsewhere. Forbes estimates that the MLB's total revenue in 2023 was over $10 billion, fueled largely by U.S. and Japanese fans. As long as those markets are strong, Ohtani's value is justified.
Ohtani's Journey from Japan to MLB
Born in Oshu, Japan in 1994, Ohtani showed prodigious talent from a young age. He attended Hanamaki Higashi High School, where he threw a 99 mph fastball at age 17. He was drafted by the Hokkaido Nippon-Ham Fighters in 2012 and spent five seasons in Nippon Professional Baseball (NPB). There, he developed his two-way skills, winning the Pacific League MVP in 2016. In 2017, he posted a 1.86 ERA with 174 strikeouts as a pitcher and hit .332 with 22 home runs as a batter—a feat that caught the attention of MLB teams.
Ohtani chose the Los Angeles Angels when he moved to the United States in 2018, signing a minor-league contract with a $2.3 million signing bonus (international bonus pool restrictions prevented a larger deal). Despite dealing with injuries early in his MLB career, including Tommy John surgery in 2018 that limited his pitching in 2019 and 2020, he came back stronger. In 2021, he won MVP unanimously and was named the AP Male Athlete of the Year. In 2023, he led the Angels to their first winning season in years, though they still missed the playoffs.
After the 2023 season, Ohtani became a free agent. The bidding war was intense, with the Dodgers, San Francisco Giants, Toronto Blue Jays, and Chicago Cubs all making serious offers. In the end, Ohtani chose the Dodgers, citing the team's winning culture and proximity to his previous home. He also granted a massive deferral to help the team build a championship roster. The Dodgers promptly signed other stars like right-hander Yoshinobu Yamamoto (also from Japan) and traded for pitcher Tyler Glasnow to surround Ohtani with talent.
The Impact on Baseball and Sports
Ohtani's contract is a landmark moment for baseball. It signals that teams are willing to invest enormous sums in generational talent, even if the player doesn't have global cross-cultural appeal. It also shows how deferred money can be used creatively to manage salary caps and luxury taxes. Other sports may take note. In the NFL and NBA, deferred contracts are rare due to salary cap rules, but baseball's lack of a hard cap allows for such innovation.
Moreover, Ohtani is a role model for athletes who want to defy specialization. Young baseball players around the world now see that becoming a two-way player is possible. The “Ohtani rule” already allows pitchers to also serve as designated hitters without leaving the game, a rule change that MLB implemented partly to accommodate his talents. More players like Ohtani could emerge in the future, changing the way the game is played.
What the Future Holds
Ohtani is now the face of baseball in 2024 and beyond. With the Dodgers, he has a realistic chance to win his first World Series championship, which would cement his legacy even further. He is also only 29, meaning his prime years are likely still ahead. If he stays healthy and continues his two-way dominance, he could rewrite the record books over the next decade. His contract ensures he will be a Dodger, barring a trade, through age 39—though he may not pitch at that point, as pitchers typically decline faster than hitters.
Off the field, Ohtani's quiet, humble demeanor contrasts with the flamboyance of many sports stars. He rarely speaks English in public, relying on interpreters, and maintains an air of mystery. This only adds to his allure in Japan, where modesty is highly valued. His popularity there is unparalleled; a recent poll found that 98% of Japanese citizens recognized his name. In the US, his Q Score (a measure of marketability) among baseball fans is among the highest in the sport.
The $700 million contract will be analyzed for years. It may be seen as either a brilliant investment or an overpay, depending on how the Dodgers perform. But one thing is certain: Shohei Ohtani has already made history by surpassing the biggest names in sports. While Messi and Ronaldo enjoyed global stardom, Ohtani has carved a different path—one that leads directly to the bank with a bag of unprecedented size.
Source: Die Presse News