“What We Talkin’ About”: Process, Quality, and Percentages

This is the final draft of the first chapter of Caponomics: Moneyball Thinking for the NFL. We’re sending it out to publishers this week, but a) I’d love to share it with the Over The Cap audience as I’ve been unable to post much since March as I’ve been in the process of re-writing my first draft of Caponomics and b) I figured this would be an avenue to reach publishers I don’t have access to.

After about 16 months of researching the salary caps of Super Bowl champions, this chapter is an introduction to a book that is (my best attempt at) the process or the blueprint for how to build a successful NFL franchise. 

Continue reading “What We Talkin’ About”: Process, Quality, and Percentages »

The 2015 Sando/ESPN QB Tiers Project and Salaries

Mike Sando of ESPN just wrote up his 2nd annual QB tier rankings in which he polled a number of football people to rank the quarterbacks in the NFL. Mike then crunches the numbers to place players into one of four tiers. It’s a great concept and helps illustrate the various opinions that people have on players in the NFL.  And for the second straight year I’ll look at the opinions and see how they line up with salaries in the NFL.

Continue reading The 2015 Sando/ESPN QB Tiers Project and Salaries »

The Manning vs. Brady Debate and What the Broncos and Manning Should Do in 2015….

The main thing we’re focusing on here will be what Manning and the Broncos should do in 2015 to construct a roster that gives them the best chance at winning the Super Bowl, but we’ll also be addressing the Manning vs Brady debate that has been going on since the early-2000s and that New England fans think is finally settled.

I’ve always been very interested in the Manning/Brady debate and I hope I can bring a unique perspective your way with this analysis as I don’t think anyone has taken this approach. Below, we’ll be looking at their cap numbers and the percentage of the cap both quarterbacks took up over the course of their careers. Then we’ll look at how their cap hits affected the team that was constructed around them by analyzing their team stats over the years.

I do think through analyzing both of their careers from a cap perspective, we’ll be able to better understand the argument of who’s the better quarterback, but also better understand the impact that the salary cap can have on a team regardless of how good the player is. Very few doubt that Peyton Manning is the greatest regular season quarterback of all-time, but has his success and salary hurt him from being called the greatest quarterback of all-time?

By the end of this, I think I’ll put together a case that I hope would convince Peyton Manning and Tom Condon that a pay-cut is the best option for Manning from a financial standpoint. Heading into the last season or two of his career, Manning has a decision to make: do I want to make about $40-43 million these next two years or do I want to make a little less, win a Super Bowl or two and go down as the greatest quarterback of all-time?

I would argue that Tom Condon has a fiduciary duty to convince Manning that giving himself the best shot at a Super Bowl, in essence, betting on himself, will create more income for him in the long-run. Two or three Super Bowls sounds a lot better than one!

Let’s get to it…

(As always, click on the figures to enlarge them. If you have a Mac, hold the command key and click on the figures to open them in another tab.)

Figure 1: Manning vs. Brady: Cap Hits

Manning vs. Brady Cap Hits

Figure 2: Super Bowl QB Cap Hits

Super Bowl QB1 Cap Hit

Figure 3: Manning Team Stats

Manning Team Stats

Figure 4: Brady Team Stats

Brady Team Stats

Figure 5: Manning vs. Brady Stats

Manning vs Brady Stats

Figure 6: Offensive Rankings for Super Bowl Champs

Final Super Bowl Offensive Rankings

Figure 7: Defensive Rankings for Super Bowl Champs

Final Defensive Super Bowl Rankings

As you’ll see in the figures above, Manning has consistently had a much higher cap hit than Brady over the course of his career and my argument is that his cap percentage has been a huge factor in his playoff struggles over the course of his career.

When you compare Manning’s cap charges over the course of his career, he’s cost his team 3.95% more of the cap per year. Just looking at team’s top 10 cap charges in 2014, an extra 3.95% of cap space could help you sign free agents over the years like Elvis Dumervil (2.54%), Donte Whitner (3.2%), Chris Clemons (3.92%), DeSean Jackson (3.2%), Connor Barwin (3.68%), Dominique Rodgers-Cromartie (2.07%), or Golden Tate (2.33%).

That was just a display of what 3.95% could get you on the free agent market, but even MVP level players like JJ Watt (3.44%) and Antonio Brown (3.40%) cost less than the 3.95% more of the cap that Manning took up. Obviously, this isn’t me saying who the Colts or Broncos could have gotten over the years, just a display of what that kind of cap percentage can get a team. Due to this, I think that extra 3.95% is a huge deal.

When we’re discussing Brady, the fact that he won three Super Bowls by his fourth season enabled them to have a championship caliber team around him due to his low cap hits. His ability to work with the Patriots to have a team friendly contract also has allowed him to be surrounded by a Super Bowl caliber team throughout his career.

When you compare their Super Bowl winning years, Manning’s cap charge was 10.36% during his 2006 season, while Brady averaged 5.57% over his four Super Bowl winning years. Even when you use Bledsoe’s cap number instead of Brady’s in 2001 since he was their number one cap hit, his Super Bowl average is till 2.34% lower than Manning’s. An extra 2% of cap space is similar to what Rodgers-Cromartie cost the Giants this year and a great cornerback can be the difference between winning a Super Bowl or not. In fact, Julian Edelman cost the Patriots 2.07% of the cap this year with the extension he signed in March of 2014. If Brady had a contract like Manning’s, do they have the space to sign such an important piece of their Super Bowl run? Or do they just decide to roll with Amendola and draft his back up?

Manning vs. Brady: Team Offense and Team Defense

When you look at the statistics of team offense and defense, you really get an idea of how much Manning’s cap number could have hampered the Colts over the years. In 2004, Manning lost to Brady in the AFC Championship game 20-3. While Manning had a historic year with 4557 passing yards and 49 touchdowns, which was a record at the time, he took up 20.50% of the salary cap, which is 7.42% more than Steve Young took up in 1994 as the highest Super Bowl cap hit of the salary cap era.

I would argue that the fact that Manning took up one-fifth of the Colts cap that year, is why their defense was one of the worst in the NFL and is a huge reason why the Colts lost to the Patriots that year. The Colts defense was 19th in points allowed, but 29th in yards with their pass and rush defense both being below 24th in the NFL. Their rushing offense was 15th in the NFL.

For 14.24% less of the cap, the Patriots got Tom Brady for 6.26% of the cap and while he didn’t have as good a year as Manning, the team was built to win in the playoffs with a rushing attack that was 7th in the NFL and a defense that was 2nd in scoring defense and 9th in yards allowed. That 2004 season really stuck out to me as a salary cap lesson. Sure, Manning might be the greatest regular season quarterback of all-time, but you can’t win in the playoffs without a more balanced team.

Even during Manning’s Super Bowl winning 2006 season, the Colts were 18th in the NFL rushing the football, their defense was 23rd in points, 21st in total yards and they were the worst rush defense in the NFL. A huge x-factor during that playoff run was a healthy Bob Sanders, who only played four games during the regular season, but helped the Colts give up only 73.3 rushing yards per game during their playoff run.

Since Manning has rarely had a balanced team, great playoff teams, teams that are balanced and have great defenses are able to dare Manning’s teams beat them with the rushing game and so many times, they’ve been unable to do that.

I don’t think it’s a coincidence that during Manning’s 29 and 31 year old seasons, which sandwich his Super Bowl 2006 season, he had two cap hits under 10% of their salary cap and the Colts had the number one scoring defense in each of those seasons. These were also the only two seasons of Bob Sanders career that he played more than six games.

Unfortunately for the Colts, during that 2005 season, they lost by three to a Steelers team on their way to a Super Bowl in the Divisional Round and in 2007, they lost to the Chargers by four. In 2007, Marvin Harrison only played five games, which left Dallas Clark and Anthony Gonzalez as their second and third leading receivers with a combined 1192, which just isn’t enough if you’re going to be a pass-first team, with the 18th best running offense in the NFL.

In that Divisional game against the Chargers, Harrison had a small role and Antonio Cromartie covered Reggie Wayne for most of the game during the best season of his career and had a spectacular one-handed interception and forced a Marvin Harrison fumble.

Since Manning has rarely had a balanced team, great playoff teams, teams with great defenses have often been able to dare Manning’s teams beat them with the rushing game and so many times, the Colts and Broncos have been unable to run the ball.

When I compare the offensive and defensive team stats of the two teams Brady and Manning have quarterbacked, I note the sustained balance of the Patriots over the last 15 years. The Patriots have had a point differential 3.4 points higher than Manning’s teams. When I look at teams build to win in the cold of the playoffs, I look for rushing and rushing defense and the Patriots are better in both of those because they’ve been more balanced over their careers.

So much of the playoffs, as we saw in January of 2015 especially, come down to game planning and match-ups. In 2005 and 2007, when Manning had the best defenses of his career, he ran into two teams in the Steelers and Chargers who matched up very well with them because of defensive backfields made up of players like Ike Taylor and Troy Polamalu, then Antonio Cromartie and Quentin Jammer.

The Patriots are the team that’s exploiting your weakness because they’re good enough at everything to do it. Balance isn’t being the best passing and rushing team in the NFL because that’s just too hard to do in this era. Balance is being able to ram LeGarrette Blount down the Colts throat like the Pats did in January because you’re good enough to do that. The Patriots have been doing that kind of stuff for a decade and a half, it helps that they have one of the greatest football minds ever, but it also helps that they have one of the best quarterbacks ever for a very reasonable cap number.

2014 Broncos and What It Means for 2015

Now, the 2014 Broncos were one of the most well-balanced teams of Peyton Manning’s career, but unfortunately, he had that right thigh injury that we all saw really hamper his abilities against the Colts. I’m a firm believer that he has a lot left in the tank, I think he’s still the quarterback who was on pace for 5280 yards and 48 touchdowns, while completing 67.08% of his passes through 10 games. Those yardage and touchdown totals would both be in his top three for his career.

It’s no coincidence that his numbers began to falter when Julius Thomas went down against the Rams in game 10. Throughout his career, Manning has been very reliant on the tight end. Even during his first year in Denver, Jacob Tamme and Joel Dreessen combined for 93 catches 911 yards and seven touchdowns.

Heading into that St. Louis game, Julius Thomas had 38 catches for 423 yards and 12 touchdowns in his first nine games, which ends up only being 47 yards a game, but opens the field up for the rest of the passing game. Once Thomas went down, opposing defenses didn’t need to worry about the tight end, even when he was playing, he was unable to play full speed. Excluding the three catches for 46 yards and a touchdown that Virgil Green had in Week 17 against Oakland, the Broncos had 14 catches for 128 yards over five games, only 26 per game.

When you look at Manning’s career, tight ends have always played a vital role in his offenses. Over the course of his career, they’ve accounted for 21.1% of his passing yards and 25.7% of his passing touchdowns. They’ve always been a vital part of his red zone success as evident by the massive impact Julius Thomas has had scoring touchdowns the last two years.

Excluding the 2011 season that he was injured, from 2006 to 2013, Manning’s tight ends have averaged 104 catches for 1075 yards and 9 TDs. The only time Manning had a tight end with over 1000 yards was in 2009, when Dallas Clark went for 1106 yards. Over those seven seasons, only 13 tight ends had over 1000 yards, yet Manning’s assortment of tight ends have combined to average Pro Bowl numbers.

Figure 8: Manning’s Tight Ends

Manning's Tight Ends Stats

Figure 9: Leading Tight Ends from 2006-2014

Leading TEs since 2006

Julius Thomas is the most athletic tight end Manning has ever had in his career, but he has some question marks like injuries, blocking skills, and the fact that he hasn’t had more than 800 receiving yards in a season, yet will command top market value. Seeing the importance of tight ends in a Manning offense and the growing importance of the tight end in the NFL, I think the Broncos need to resign Thomas if they want a shot at the Super Bowl.

I do think that signing a less heralded, cheaper player like Charles Clay or Jordan Cameron and drafting someone like Florida State’s Nick O’Leary in the second or third round. Even drafting Maxx Williams in the first round could be the way to go if Thomas leaves, but I would certainly sign a veteran because of the time it takes for a tight end to develop. There are a lot of different choices they could make if they don’t resign Thomas, but I’d rather stick with a more known commodity if I were them.

One thing I’ve researched a bit this past week is production by top tight ends as rookies and I’ve come to the conclusion that tight end is a position where players need a few years to develop. They need to be NFL ready as blockers and pass catchers to produce, while running backs and receivers obviously both have to do this as well, more is asked of tight ends as inline blockers and pass catches, so it’s very unlikely that the Broncos will be able to plug-and-play a rookie who can play at a Super Bowl level.

Here are the rookie stats of some of the best tight ends over the last 20 years and some of the best young tight ends like Clay, Coby Fleener and Zach Ertz.

Figure 10: Top Tight End Production as Rookies

Tight End Production As Rookies

Jeremy Shockey and Rob Gronkowski are the only guys with rookie year numbers comparable to what Manning has come to expect from the tight end position. I don’t think there are any tight ends in the 2015 draft ready to produce at that level as rookies, so if they let Thomas go, they will definitely need to replace him with a veteran free agent. Like when Manning missed the 2011 season, we saw how valuable Thomas was in his absence as Manning struggled down the stretch.

I mention all of this because I think that Manning’s 2014 Broncos were the best overall team he may have had in his entire career. They had talent in all the right places and spent their money on the right positions with their top 11 cap charges being on the pass game positions that I spoke of in my analysis of Super Bowl Champions.

Figure 11: 2014 Broncos Top 10 Cap Hits

2014 Broncos Top 10 Charges

According to Pro Football Focus, Ryan Clady and Wes Welker were the only players in this group who had bad seasons with both of them being in the negatives, but outside of that, I think the Broncos had a well constructed salary cap for the year with money being spent in the right places.

Heading into the offseason, they’re similarly set up in 2015, but that’s before we factor in the free agents that they’re almost certainly going to want to resign: Demaryius Thomas, Julius Thomas, Terrence Knighton, Brandon Marshall and Orlando Franklin. Then there are the next level of guys who they would probably want for the right price like Rahim Moore, Jacob Tamme, Virgil Green, Will Montgomery, and a few others who will probably be cheaper. They also must address some of their holes from 2014 and replace free agents they’ll be letting go.

Manning and the Broncos in 2015

While Broncos do have cap space, they won’t if they want to sign Thomas, Thomas and Knighton. At the end of 2014, they had $107.3 million, or 76.6%, of their 2015 cap locked in. Demaryius or Julius will be franchised for $12.8 or $8.33 million, so after that, the Broncos will be between $115.63 and $120.1 million.

Which leaves about $20 to 25 million for the entire rest of their team, including whichever Thomas they didn’t sign and Terrance Knighton. Considering the rate of the franchise tags, resigning all three near that rate for their talent would put them at $138-140 million. Considering that Julius Thomas reportedly turned down an offer that would pay him $8 million a year, he might cost even more that that franchise tag. I think that the weak tight end class this year also increases Thomas’ contract.

So with the cap about to be set between $140-143 million, they’re right there before they sign guys like Brandon Marshall, Orlando Franklin, Will Montgomery, Rahim Moore, any other positions they want to address and their draft picks.

If Manning wants all three of those key pieces to their success and more, then something must be done about his contract.

As Jason and I have both researched here on Over The Cap, the highest QB cap charge, the highest single cap charge of the salary cap era for a Super Bowl winner was Steve Young in 1994 when he took up 13.08% of the salary cap. As seen in the figure below, Manning’s 2015 cap hit will be two percentage points above that. Considering this is an era of quarterbacks, I think it increases how much better Manning has to be than Young to justify the increase in cap percentage.

Figure 12: 2015 Broncos Top 10 Cap Hits

2015 Broncos

What’s more interesting to me is that in 2006 with the Colts, Manning took up 10.36% of the cap. He played the best football of his career in 2013 and was on a great pace this year before Julius Thomas went down, but is he 50% better at 39 in 2015 than he was at 30 in 2006? Is he that much better than Steve Young was at 33? That’s what the cap numbers say to me. To win a Super Bowl, the cap numbers are telling Peyton Manning that he has to be the most valuable quarterback in the history of the salary cap era.

What also sticks out when looking at their Top 10 cap charges is that they’re taking up about 60% of the salary cap without signing three guys who will end up in their Top 10. Manning’s huge cap number throws off the rest of the roster.

Figure 13: Super Bowl Top Cap Charges

Super Bowl Top Charges

As you see from the figure above, Manning’s cap number knocks the Broncos off the average charges of Super Bowl champs. The 2013 Seahawks’ Top 10 took up the most cap space of all Super Bowl teams with 61.31% with the 2012 Ravens second with 56.72%. As Jason and I have pointed out, the Seahawks were so out of the ordinary that you can’t measure most teams against them, with Russell Wilson taking up less than a percent of the cap along with all the other high value guys on cheap rookie deals, very few teams would be able to make up the mistakes they made with their cap that year.

It’s not that it’s impossible for Manning to win a Super Bowl with these numbers, but it’s about giving himself the best chance.

 

I’ve discussed on OTC before I’ve always been curious to what the best way to construct a team is, so that I can help advise my future clients to take contracts that maximize their earning potential, but also give them the best chance to win. While some players surely care about the money more than winning, winning is a lot more fun and at the stage that Peyton Manning is in his career, I’m sure he wants to win one more Super Bowl.

I would never tell a fellow American, “I do think at a certain point you’ve made enough money,” but with a net worth near $165 million, I do think another Super Bowl is worth more to Manning than the few million he could lose with a pay cut or restructure. I also think that being a two-time Super Bowl champion could be worth more to him than whatever he’d lose in income this season.

Now that Brady has won four Super Bowls, he’s probably overtaken Manning in the greatest quarterback argument. The average fan isn’t going to understand that the difference between Manning and Brady’s cap number over the years could be a huge reason why Brady had more playoff success. The only year that Brady had a higher cap number than Manning was that 2006 season when Manning beat Brady in the AFC Championship.


Conclusion

 

I think that these figures show just how spectacular Manning is as a player because of the incredible things he’s accomplished statistically and in the playoffs with a seemingly insurmountable salary cap figure. I think that agents need to fully understand the value of their players to the point of the maximum percentage their client can earn, while still allowing his team to succeed.

With many of his teams over the years, over the course of an entire season, Manning can put up historic numbers and make up for his team’s inefficiencies, but I think, the extra 3.95% more than Brady that he has cost on average over his career has made a huge difference in the playoffs. Manning’s career average of 12.20% is 5.49% more than the cap percentage of the average Super Bowl starting QB. Despite only winning one Super Bowl, I think his accomplishments despite his cap numbers should be recognized.

The fact that Manning brought the Colts to a Super Bowl in 2009 while taking up 17.24% of their cap is remarkable, but also illustrative of the downfall of spending that much on one player as they were 32nd in the NFL in rushing with less than 81 yards rushing a game and they had an average defense. Remember, NFL “capology” is a young field of study, I don’t think Manning or the Colts understood that his cap percentage made things much more difficult for them.

With Tom Brady’s success last year with a relatively low cap number, he’s started to affect the entire marketplace. People are calling for Ben Roethlisberger and others to restructure their contracts to give their team the best chance to succeed, and they’re right. Tom Brady has changed the game and in a way that will help all players as there will be more money to go around.

What we are beginning to see is the quarterback bubble burst like in any marketplace. Whether it’s a financial or housing bubble, or the coming burst of the higher education bubble, a market will always correct itself. We’ve seen this at the wide receiver and cornerback positions in recent years after the huge deals for players like Mike Wallace, Percy Harvin, and Brandon Carr.

Brady and Manning are two of the greatest quarterbacks of all-time and while I think Manning is the more talented player, Brady’s biggest advantage has been his much lower cap number over his career. In speaking with Jason, we agreed that Manning and the Broncos should agree on a contract somewhere in the neighborhood of the $14 million that Tom Brady will be making in 2015. This will put his cap percentage at 10% and allow the Broncos to build a scary good team around him. That extra $7 million could allow them to resign everyone they need to and then get a big-time WR3 in a deep market, someone like Jeremy Maclin or even Michael Crabtree at a low-cost.

If Manning drops that cap number, look out.

If you have any questions or want to start up the discussion, comment below or tweet me! I’ve been in Indianapolis this week for the combine and it’s about zero degrees with a wind that shoots through your body, I literally have no idea how people lived in the north before legitimate heating existed. Do not go outside this weekend, just stay inside, watch the combine, relax and read Over The Cap. I give you permission.

Zack Moore

If you want to purchase The First Annual Caponomics: Understanding NFL Roster Building through Super Bowl Champion Salary Cap Analysis, which has analysis like this in it, please e-mail me atCaponomics@gmail.com, so that I can put you on our e-mail list for people interested in purchasing the book.

Thoughts on the Tom Brady Restructure with Patriots

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According to ESPN’s Adam Schefter and Mike Reiss Tom Brady resturctured his contract with the Patriots to convert his guarantees from skill, injury, and cap to injury only in exchange for an extra $1 million per year. This is not really a salary cap maneuver but simply a move made to improve the cash situation of the Patriots next year.

Teams that have a skill guarantee with a player prior to the season will be required to set aside that money such that it is guaranteed to be covered in the event the player is terminated from his contract. For the Patriots that meant in March they would have to deposit $24 million, Brady’s full guarantee, in an account that they could not touch. Once converted to injury only the Patriots are not required to deposit the money unless Brady was so injured that the injury guarantee could kick in. This is one of the reasons some teams will use vesting guarantees in a contract when the guarantees seem as if they are fully guaranteed upon signing.

Brady’s actual salary this year was set to be $7 million and it will now increase to $8 million, so the real cash flow gain for the season by the Patriots is going to be $16 million rather than the $24 million being reported. Based on the reports this move will reduce New Englands available cap space next year by $1 million. For Brady this is a no risk restructure as he would likely earn at least what he gave up if he was released and put on the open market.

Brady’s relationship with the Patriots is one of the most interesting dynamics in all of sports. His willingness to do these things almost creates an unfair advantage as no other high end QB has ever played ball to this level with a team.  Brady’s initial $24 million extension was signed at a time when he would have likely commanded between $55 and $60 million over the same timeframe on a regular contract extension.

Brady’s $8 million salary in 2015 ranks 17th in the NFL, a ranking that will fall further once quarterbacks are extended and other drafted in the top 5. His cap charge of $14 million also ranks 17th. Meanwhile his closest contemporaries of Peyton Manning, Drew Brees, and Tony Romo will carry cap charges of $21.5, $26.4, and $27.7 million and actual salaries of $19, $19 and $17 million. There is likely no other player in the NFL that would work with a team in this manner and the Patriots should be thankful for having a player like Brady.

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Could the Patriots Draft a Quarterback?

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This week it was reported that the New England Patriots met with QB Johnny Manziel and had scheduled some visits with other draft hopefuls at the QB position. The immediate reaction seemed to be that Patriots coach Bill Belichick was either scouting future opposition or trying to gauge the interest in the players so that he can negotiate a trade on draft day because there would be no need to draft a QB with Tom Brady on board. I’d like to take the opposite approach and see why, if the right player fell down the draft, it would make sense for the Patriots to consider the QB option.

While everyone recognizes Brady as one of the top two QB’s of his generation, he will be 37 in 2014. He is certainly still very productive but I think most people are beginning to see the decline in his play over the last two years. In 2013 he seemed to struggle with nagging injuries and that helped to lead, along with a decimated receiver corps, to what was arguably his worst full season since 2006. While his worst is still pretty good, the expectation at this stage of his career is to probably maintain his current production or slightly fall.  If the nagging injuries become something worse there is no real answer sitting on the Patriots bench.

For the last three seasons New England has been in a position to basically cruise into the playoffs due to a poor division that has not seen another team post a winning record in that timeframe. In general the competition in the AFC has eroded so badly that Brady, even on a bad day, should easily lead his team to the playoffs. But Brady does have a finite life and at some point New England has to prepare for life without Brady.

While I doubt anyone thinks too highly of the QB’s currently in the AFC East the three teams do now have in place two first round selections and a high second round selection to potentially hit their primes starting in 2014 and 2015 if they pan out. Andrew Luck should improve in Indianapolis while teams like the Browns and Texans are in position to draft highly rated prospects.   What the Patriots do not want to be at any point over the last 4 years of Brady’s career the 2010 Minnesota Vikings where the 41 year old Brett Favre broke down and the team fell apart with him.

When the Patriots signed Tom Brady to his three year contract extension in February of 2013 they signed him to a contract that had an eye looking toward the future rather than the past. This was very different than the contract the Denver Broncos signed with Peyton Manning in 2012. The contract with Brady represented the possibility of a dropoff in play with low salaries and cap charges. The team put in a slight failsafe in the event of a catastrophic event in 2013 or 2014 in which they could release Brady before the end of the 2014 season and prevent $24 million of late career guarantees from kicking in.

Quite frankly the contract easily allows the possibility of bringing in a first round draft pick to sit and learn behind Brady and then hit the ground running whenever the time to pass the torch arises.

The low salaries taken by Brady have dropped the Patriots salary cap allocations to the position into average or below ranges. The Patriots salary cap spending on QB ranks as follows among teams with a QB under contract the next four seasons:

2014-13/32

2015-14/31

2016-9/16

2017-7/7

If the Patriots added a QB with the 29th pick in the draft it would add about $1.4 million to their cap  this year, $1.7 in 2015, $2.1 in 2016, and $2.5 in 2017. They would also control the players’ rights at a modest salary in 2018 when Brady’s contract would be finished.  Adding these salaries would bump the Patriots up in the rankings by about 1 team in each year, still allowing them to be middle of the pack while employing Tom Brady and a first round draft pick. They could move up in the draft and still be very cost competitive at the position.

I don’t think the Patriots have to make the move for a QB by any means right now, but the smart thing for them to do is to begin the process of identifying potential successors to Tom Brady so they don’t hit the struggle period many team do when they lose the once in a generation QB. It’s no different than when the Green Bay Packers wisely grabbed Aaron Rodgers in 2005 so that they had a successor to a then 36 year old Favre. That is a far better strategic move than picking the brains of a college QB to consider future matchups with the late 30s QB.  The team has contractually set themselves up to make this move and it should surprise no one if they do actually make that move on draft day for a name QB that falls down the draft board.

Super Bowl Rings and the Overpricing of the Quarterback

With Tiki Barber taking to the airwaves again to make his latest outlandish statements, it immediately brings up the more modern TV made argument of just how important a Super Bowl ring is to the legacy of the QB. Since then its grown to become a difference maker in salaries and contracts for QBs who have outdistanced everyone else in the game by a wide margin now because of the correlation that is expected between QB and SB titles. Seems like a good topic.

To be honest I don’t really recall the “he just wins” argument being a big deal when I grew up in the 1980s and 1990s. Obviously Montana would be the guy who won, but Montana also put up good stats for that era, specifically in the defense dominated NFC. He was  a perennial Pro Bowl guy  and was always in the upper 20’s in his Touchdowns when healthy.

I don’t recall (and maybe its just from being too young) people killing Dan Marino and John Elway on TV. I remember people talking about both as two of the greatest QB’s of all time. It wasn’t until much later on that I would hear people bringing up Elway’s Super Bowl wins as reasons that he was one of the best 3 or 4 of all time, which is a ridiculous argument since the Elway of the late 90’s was the one being carried to a title whereas the Elway of the 80s was the guy carrying really bad teams to title games, where the team would get exposed for being awful.

I don’t recall anyone putting Terry Bradshaw’s name on the list of greatest of all time. Hall of Famer sure, but whenever people talk of best ever does his name pop up?  Not really, despite all the Super Bowl success. Even Troy Aikman, leader of the famed 90’s Cowboys, doesn’t get brought up as the greatest ever because statistically he did not produce to the same level as other players of his time. If Aikman or Bradshaw played now they would not just be Hall of Famers but considered among the greatest to play the game because of the way the criteria changed at some point.

I always felt that the change in QB evaluation metrics came with the Patriots second Super Bowl Championship. ESPN or other media outlets wanted to create an argument that Tom Brady was better than Peyton Manning. Manning was the far more polished player, being drafted number 1 overall in 1998 and being considered the perfect prospect. Brady was an unknown playing for a defensive minded coach who was a failure in his first stint as a head coach in the NFL.

Statistically there was no comparison. Manning was consistently at 4,200 yards on a high powered offense that averaged 26 points a game. Brady was a 3,600 yard guy on a team around 22 points a game from 2001-2003. In 2003 they beat the Colts two times and in 2004, again, came out with another two victories. By the end of the 2004 season Brady was a bonafide playoff superstar and Manning was anything but. The debate was strictly turned to rings.

From that point forward playoff success has gone from the media right into the negotiating room. The ring became the biggest money maker in all of the NFL. In the pre-rings era players like Mark Rypien, Brad Johnson, Jay Schroder, Jeff Hostetler, Jim McMahon, Jim Plunkett, Ken Stabler, and so many more didn’t break the bank off a Super Bowl. In many cases they had to fight for long term job security and are more or less footnotes in history, rather than legends.

Teams now put so much value on that ring. Ben Roethlisberger and Eli Manning only had one championship when they were made the highest paid players at the position. Not multiple rings, just one. I think we all tend to forget that Drew Brees, Aaron Rodgers, and Peyton only have one title each. Joe Flacco joined that club this season. Brees, Rodgers, and P. Manning are prolific passers but look at the difference in treatment Brees gets compared to a Tony Romo type, who in a different generation would probably be looked up very differently.

The question should be if teams better off by paying QB’s for past rings and past success at the current price levels we are seeing?  Brady may go down as one of the best QBs to play the game in part based on the fact that he has 3 Super Bowls. But when Brady put his name into the statistical arguments as well as “ring” argument how many does he have?  The answer is none. Brady the superstar Manning-esque level player  has lost two times. Manning got back once. Brees and Rodgers haven’t returned.

When I did a more statistical valuation of the QB marketplace the one clear this is that the market is overpaid based on actual production compared to an average player level. The difference is price is really attributed to past success and perceptions of future success. Is it worth it?  It is a debatable question. Here is the annual salary estimates presented as a percentage of the salary cap for the Super Bowl winning QBs from 2000-2012. For the uncapped year I assumed a cap of $129 million which was the expected number based on cap growth in the prior CBA.

Year

Player

% Cap (based on APY)

2012

Flacco

3.73%

2011

E. Manning

13.54%

2010

Rodgers

9.85%

2009

Brees

8.13%

2008

Roethlisberger

12.64%

2007

E. Manning

6.50%

2006

P. Manning

13.73%

2005

Roethlisberger

3.86%

2004

Brady

7.45%

2003

Brady

8.00%

2002

Johnson

7.88%

2001

Brady

0.43%

2000

Dilfer

1.61%

The two highest cap eaters were the Manning brothers, with Roethlisberger being the only other player whose APY at the time ate up more than 10% of the unadjusted salary cap. It should be noted that both Eli and Roethlisberger were on extensions that allowed the total cap to be less than the new money APY used in these estimates.  They would be closer to the 11% mark looking at total contract value.

With the increased emphasis on rings the market has skyrocketed for the QB. In 2009 Manning’s Super Bowl driven APY was $16.25 million, highest in the NFL. Now that number only ranks 7th in the league.  Considering the way the cap has retreated to 2009 levels the positional spending on the QB has now spiked to incredible levels because of the “ring” part of the equation, except the highest prices are not necessarily providing more rings. Resources have to be moved out of other spots on a team to now pay for the QB. Here are the players that rank above the median Super Bowl champion in terms of cap percentage ( 7.88%) and their percentage of the current years salary cap:

Player

% Cap            (based on APY)

Rodgers

17.9%

Flacco

16.3%

Brees

16.3%

P. Manning

15.6%

Romo

14.6%

Stafford

14.4%

E. Manning

13.2%

Schaub

12.6%

Rivers

12.4%

Roethlisberger

11.9%

Sanchez

11.0%

Bradford

10.6%

Cutler

9.9%

Brady

9.3%

Ryan

9.1%

If any of the first six names win a championship this season it would represent the highest percentage of cap spent on a QB contract since 2000. The first 12 names all represent numbers greater than 10%, a feat only achieved by three players.

Teams are focusing on the wrong things with the QB payscale and it’s most likely the reason why a team like the Patriots pulled Brady back so much. For as great as he is his salary level was unsustainable if you are looking to build a complete team to win a championship.

With a good crop of young QB’s now in the NFL under a low wage system you will continue to see the trends of the lower cost player winning championships while those with the big money items struggle to find balance on their football teams. It is going to put teams at a competitive disadvantage, at least for the long term, with the overspending on a past Super Bowl on a team constructed with far less spend on the QB position.

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The Role of Age in the Success of the NFL QB

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In keeping up with our theme of extending Quarterbacks I decided to look at the age of QB’s advancing deep into the playoffs, meaning at least an appearance in a conference championship game.  Why team success instead of stats?  Primarily because QB’s are paid at an extremely high rate since teams are equating playoff success with QB play.

We’ll begin by breaking the numbers down by decade.

avgage

The 70’s were certainly a different brand of football. The average age of a Super Bowl participant was 31.4. The next closest decade was just 30.3. All 10 seasons in the 70’s had at least 2 QB’s over 30 and 6 years saw at least one over the age of 35. In the 33 years that have followed, only 15 seasons had at least 2 QBs over 30 leading their team to a conference championship game and only 11 seasons with a QB over the age of 35.

Focusing on 1980 thru 2012, we can begin to see some trends that develop. The following graph represents the percentage of players appearing in the championship game sorted by age, with a best fit line trend line added to smooth the data. We can call this a Quarterbacks lifecycle.

qblifecycle

This chart really should be a guideline for teams when identifying talent and extension possibilities for the QB position.  47% of participants in the Championship game were ages 26 thru 29. It’s 54.5% if we extend it to 30. Beyond 30 the numbers begin to crumble. 18.2% were between the ages of 31 and 34 and the 35 and over category is just 10.6%.  The numbers just affirm the saying that “it’s a young mans game”.

The consistent plus 31 group is from an older generation. Joe Montana and Steve Young led the way with 4 appearances while John Elway and Jim Kelly both had 3. The only players whose careers did not begin before 1990 that made the list multiple times were Tom Brady and Brett Favre, both of whom made it two times past the age of 30. The other post 90 QB’s to do it were Brad Johnson,  Kurt Warner, Peyton Manning, Jake Plummer, and Donovan McNabb.  Of the 7 Super Bowl winners (in which I included Phil Simms due to so many starts even though he was injured for the playoffs) only Johnson would be considered a modern era QB. Of the 14 who played in the Super Bowl a total of 4 are from the modern era (Manning, Brady, and Warner along with Johnson).  That doesn’t mean nobody is going to do it again but it’s a hard task, especially if high cap charges for the aging QB, not an issue in the 80’s and even partially in the 90’s, compromise your ability to field the best roster.

As we look around the NFL there are a number of contracts that defy logic just based on the age criteria. Perhaps there is no worse contract in the NFL than the contract given to Peyton Manning. Manning fell into an age group that had a 7.6% chance of making it to at least the title game and in each season the odds get progressively worse. On average he gives the Broncos a 1.5% chance of making it and for that makes $19.2 million a season. The Broncos are paying $12.672 million per percent, by far the highest in the NFL. The Patriots, who were praised to no end (myself included) for the contract extension given to Tom Brady, have the second highest effective spend in the NFL on the position. Brady’s contract may be more difficult to escape than Manning’s, though Brady has been far more successful in the postseason and is one of the most likely candidates to make it back again to the title games as this generations Montana or Elway. Tony Romo is the 3rd worst bargain in the NFL and with no track record at all he is a prayer player for the deep playoff run.

When you look at the rookie contracts it just reinforces why teams should be considering the draft rather than overextending aging talent. Cam Newton, coming in at 22, would have about a 4.8% chance per year at making it over the terms of his rookie deal. Luck, a year older, would be at 7.7%. They both cost around $5.5 million a year, about 3.5 times less than Manning, and with a significantly higher chance at making it deep into the playoffs.

By extending a player earlier in their lifecycle a team can gain tremendous upside and flexibility.  Consider the option of extending Newton when he turns 25. A 5 year extension makes Newton property of the Panthers until the age of 30.  That 6 year period is the peak of the lifecycle with a 10% chance per year of making it deep into the playoffs.  By extending early and rolling the 4th rookie year into the contract the effective cap values of the contract can be smoothed out and rather than just having one low cost year and a few high seasons the Panthers have the ability to have a cap affordable contract over the entire 6 year period using the extra funds to improve the quality of the team for the long term.  In the event a player does not work out or you end up in cap trouble you can escape the contract with minimal cap penalties or potentially extend briefly into the low 30’s.

A perfect illustration of this is the cap killing contract of Joe Flacco versus that of Aaron Rodgers. While the two are at different stages of their careers Rodgers effective cap value is only $18.68 million a year compared to Flacco’s $20.1 million. The Ravens will be forced to extend Flacco at huge money figures when he turns 31. The effective age at which the Ravens will be able to escape Flacco is likely going to be 36 unless he fails so badly that they absorb major cap penalties when he is 32 or 33. Rodgers can be let go after the season in which he will be 34. It’s the benefit of extending early.

The worst thing a team could do is franchise their young QB. All a tag does is delay the inevitable of a long term deal. In Newton’s case you would pay a huge sum of money to invoke their 5th year option when he will be 26. Most likely you will extend the next year keeping him until he is 31 and on a contract with far less flexibility than one in which he was extended at the age of 25.

As difficult as it is for a team to let go it almost seems foolish to chase the dream with the overpriced aging QB, no matter what the track record of the player may be. Brady has probably exceeded all expectations but he is under a contract until he is 40 and in essence the deal is fully guaranteed if he remains on the team through the 2014 season. Structuring deals like the Brees contract that nearly ensures 5 years under contract is insanity. Now 34, Brees is in the age group that shows little upside, let alone at $20 million a season.

In a perfect world teams should be extending their QB’s at the ages of 25 or 26 and setting up contracts with exit strategies in the early 30s. If you must extend in the 30s the contracts need to be of the Alex Smith variety- 3 years with a rapid escape plan after 1 year. Everyone considers it a foregone conclusion that Eli Manning and Ben Roethlisberger will be extended in the next year or two. They probably will be and at least they have the pedigree to be the next group of post 30 stars, but the teams would likely be better off, if the draft quality is good, to trade such a player for multiple first round picks that can be turned into 22 or 23 year old QB’s. If a team does not have the guts to do that kind of move then the next best option is to draft QB’s in the later rounds until you find the successor.  If those teams do plan on extending the earlier they do it the better off they will be when it comes to long term health. It’s far better to extend Eli at 32 than at 34 or 35 years old.

This now leads into a discussion of players currently under contract with potential  extensions on the horizon, the most interesting of which looks to be Matt Ryan. I’ve said multiple times that Ryan is the best young player in the NFL, but Ryan will actually be 28 this season. This is the peak of his career and the Falcons may let him play things out. Signing him at 29 to a 5 or 6 year deal makes much less sense than locking him up at 28, though that is a better option than tagging him and then signing him at 30. Ryan probably should have been extended last season with the Falcons having plenty of options later in his career to use him to rebuild or to hope he is one of the late career success guys.

Jay Cutler will turn 30 this year, his final with the Bears. The Bears best option with him is to let him play the year out, tag him, and try to trade him to a team like the Browns or Buccaneers who will likely bid high in desperation for a QB. Phillip Rivers still has a few years remaining on his contract but with almost  no dead money the next two years this is essentially a free agent year for him. He will be 32 in 2013 and the Chargers should be doing everything in their power to trade him and get younger and cheaper at the position.

The young guys are all strong candidates if the play warrants it. Matt Stafford and Josh Freeman are only 25. I don’t think either has shown enough to be extended now though Stafford’s cap numbers may force the issue. Newton, Andy Dalton and Colin Kaepernick will all be eligible after this season for extensions. Their ages will be 25, 27, and 27 respectively, making Dalton and Kaepernick both very interesting decisions if they have decent seasons. They will be at that age where waiting is counterproductive once you have made the decision that the player will be your starter for the next few years. Better to make mistakes early in the lifecycle than later in it, which should push teams to extend players like this even if some questions persist.

The following table lists the veterans in the NFL and what their effective cap charges are over the entire terms of their contracts. $/percent represents the dollar figure paid for the chance to get to the Championship round. The more expensive the worse the deal is in terms of cap management.

qbtable

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