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NFL 2018 free agency: The amount of money spent on average players is staggering

Teams are giving superstar contracts to mediocre players - and will keep doing so.

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The NFL free agent market largely functions as every other market functions: services are offered and the highest bidder wins the rights to those services. And like every other market, supply and demand play a major role in determining the worth of those services. Unlike many other markets, however, the amount of money those services demand is capped. Each NFL team has a limit on how much they can spend building their roster.

Thus, each team’s cap situation plays a significant role in shaping the value of an individual free agent class. The more aggregate cap space available to teams the more they can pay to potential free agents.

Here’s the current cap situation for the 16 teams with most space available (this is taken directly from spotrac, which is a terrific resource for salary cap research).

That’s eight teams with more than $50M in cap space available. By my count that’s potentially $400+M that can be spent on free agents just by those eight teams. There’s 22 teams that have at least $20M in cap space available. That’s a lot of money that’s available to chase the current free agent class.

And thus in the last 24 hours we’ve seen NFL teams hand out over $900M in contracts with a full $330M of that amount fully guaranteed. And what has those expenditures bought? Let’s checkout the top 10 free agent purchases:

So, a couple observations:

  • All three quarterback signings seem...staggering...but reasonable. Cousins got only three years but all fully guaranteed. But his contract didn’t really move the needle in terms of AAV (average annual value). The reality in today’s NFL is if you want a top 10 QB you’re looking at $25-$30M per year. Brees just enjoyed his best season in five years and $25M per year to stay in New Orleans makes sense. I can’t really argue with the Keenum signing either. Note that all three contracts are three years or less.
  • We have two guards, including 2017 All Pro Andrew Norwell. His contract raised a lot of eyebrows because it’s higher than I think most Cowboys’ would have expected to pay Zack Martin. Norwell might have been the best guard in the league in 2017 but Martin has been the best guard in the NFL over the last four years. Norwell has a single All Pro honor while Martin has been named twice and has four Pro Bowl honors. Martin’s career AV of 48 dwarfs Norwell’s 30 career AV. The Norwell signing set off alarm bells within #CowboysNation because Martin is likely to demand - and receive - more.
  • We also see a run on wide receivers, all at prices that leave me shaking my head. Let’s take just one, Sammy Watkins. His new contract calls for him to earn $48M, with $30M guaranteed and an AAV of $16M. We don’t know the details but we can guess most of the $30M is in the form of a signing bonus with salaries in the $6-$8M range.

Those are huge numbers for a former top-5 draft pick whose been a bust by most evaluations. Compare Watkins’ contract with, say... Dez Bryant. Bryant has two years remaining on his five-year deal with cap hits of $16.5M for both 2018 and 2019. Bryant’s “poor” performance and “bloated” cap hit have led many to speculate the Cowboys will simply cut the team’s all time touchdown reception leader.

And yet, if we compare Watkins and Bryant we can see Bryant has been the better receiver over his career and recently has been very similar:

So, while some Cowboys observers are ready to ditch Dez Bryant and his cap hit, other teams are willing to give the same amount of money to a similar player. Admittedly Watkins is younger, but the numbers really don’t distinguish him from Bryant.

Take a look at the next tier of players signed in the first day of free agency:

Total number of Pro Bowl seasons accumulated by these players: five. Total number of Pro Bowl seasons accumulated by these players not named Richard Sherman: zero. The point: these are not marquee players, they are mediocre players. They’re often not even starters. Again, let’s look at receiver Albert Wilson and compare him to the Cowboys’ own Terrance Williams.

By any measure Terrance Williams has been a better, more productive receiver than Albert Wilson throughout their respective careers. I’ll freely admit I didn’t know who Albert Wilson was. His 12 starts the last two seasons illustrate he’s a borderline 3rd/4th wideout.

But he’s now the recipient of a $24M contract over three years with $8M guaranteed. Compare that with Terrance Williams whose current contract called for $17M over four years, with $9.5M guaranteed.

So what have we learned? Let’s see:

  • As always, free agents will be overpaid. This isn’t news.
  • Yesterday’s bad contract can be today’s good contract. Both the Bryant and Williams contracts look better today than they did just 48 hours ago.
  • Length is out. The average term of all free agent contracts agreed to thus far is only 2.55 years. Less than 25% of the free agents signed for four years or more; more than 75% of all free agent agreements are for three years or fewer.
  • Guarantees are up. Cousins received a fully 100% guaranteed contract. Where once a $100M contract really meant $20M guaranteed and then potential to make more the guarantees are coming more in line with the total of the contract.

But the real take-away.... and the reason I started this whole exercise to begin with: there’s simply too many available cap dollars for too few quality players.

Sure, players like Cousins and Malcolm Butler and Drew Brees will be difference makers for their new teams. But does anyone believe Sammy Watkins, Allen Robinson, Paul Richardson, Marqise Lee, Chris Hubbard, Aaron Colvin, Trey Burton, Ryan Grant, Prince Amukamara, Albert Wilson, Bashaud Breeland, Dion Lewis, Devon Kennard, Kurt Coleman or Chris Smith are really going to be difference-makers?

While free agents always end up getting overpaid, this season, in particular, we’re seeing players getting grossly overpaid compared to their on-field contributions. It’s simple supply and demand. There’s too many salary cap dollars in the marketplace for too few quality players.

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