Dark Clouds: A Year of Scandals and Financial Woes

Eleven years have passed since 2004, when an array of issues came to the fore to challenge the stability of professional baseball in Japan. The crisis began when Nippon Professional Baseball proposed that the financially strapped Kintetsu Buffalos be merged with Orix BlueWave.

Owners looking to close the revenue gap between the Central and Pacific Leagues then threw their weight behind a proposal to join the two leagues and play the season with 10 teams. The players union, the Japan Professional Baseball Players Association, opposed both proposals, arguing to keep the dual-league, 12-team system. With no agreement in sight, players walked out mid-season in the sport’s first-ever strike.

The standoff ended in a victory for the players union (as well as the majority of fans), with the two-league system remaining intact and owners agreeing to create a new franchise, the Tōhoku Rakuten Eagles, to fill the void made by the merger of Kintetsu and Orix.

While the events surrounding the strike stole the headlines, NPB’s woes did not end there. News broke that the Yomiuri Giants, Hanshin Tigers, and Yokohama Baystars (now DeNA Baystars) provided cash and presents—deemed living expenses—to several college players. The payments, which took advantage of a draft regulation in place at the time allowing university and corporate league players to name the team of their choice in the annual draft, ran afoul of the draft charter and resulted in the owners and presidents of the clubs being forced to step down.

To compound matters, the owner of the Seibu Lions proffered his resignation in the wake of a major accounting scandal at the club’s parent organization, the Seibu Railway Group. Then there was the issue of cash-strapped Daiei selling its stake in the Fukuoka Hawks franchise to mobile phone provider Softbank. With the league reeling, the NPB and players union jointly established the Professional Baseball Structural Reform Council to introduce restructuring measures.

Interleague Play Boosts Status of Pacific League

From the viewpoint of the fans, the reform having the biggest impact over the last decade was the introduction of interleague games. Central League clubs were no longer the only beneficiaries of the massive popularity of the Yomiuri Giants; Pacific League team, too, gained increased exposure, bolstering local support for clubs based in such far-flung cities as Sapporo, Sendai, Chiba, and Fukuoka.

Top stars, including Darvish Yū, who now pitches for the Texas Rangers of Major League Baseball in the United States, and fastball progeny Otani Shōhei of the Hokkaidō Nippon Ham Fighters have helped raise the league’s popularity close to the level long enjoyed by the Central League.

Along with interleague play, other restructuring demands made by the players union in 2004 were:

The introduction of a luxury tax along the lines of that levied in the Major Leagues, with teams spending above a set salary threshold being required to pay a specified amount to the league to be distributed among less financially affluent clubs; Loosening of salary cap restrictions; Switching the draft to a full waiver-style system; Removing the transfer fees for free agents; Lowering the fee for new clubs to join the NPB from ¥6 billion to ¥3 billion; and Giving NPB commissioner sole control over negotiating television rights.

Implementing Reforms

Of the six demands, reforms to the draft system have been most closely tracked by fans. Under the current structure, a lottery is held to determine negotiating rights if multiple clubs choose the same player in the first round. Subsequent rounds, though, utilize a waiver-style system, with selection going in reverse order starting with the last-place team from the league with the fewest wins in interleague play.

Enabling all 12 clubs to make a simultaneous bid for a player in the first round can be considered a fair reform, as it prevents a hypothetical situation under the waiver system where a struggling team might throw the remainder of the season to gain the first pick in the draft. While highly unlikely, the appearance of a standout amateur prospect triggering such a case is not entirely implausible.

The NPB and players union were unable to see eye to eye on the luxury tax and television rights, but negotiations on a number of other points produced amicable results for both sides and assured the successful restructuring of Japanese professional baseball.

Timeline of Japanese Professional Baseball Reforms

June 2004 Plan to merge the Osaka Kintetsu Buffalos with the Orix Bluewave comes to light Internet company Livedoor makes a bid to purchase the Buffalos, which is turned down by the Kintetsu and Orix owners July Comments by owners spark rumors of a shift to a one-league, 10-team system August Kintetsu and Orix agree on a merger Stockholders and players union start legal battle to block merger September Merger finalized during an owners’ meeting, creating a new club, the Orix Buffaloes Players union begins negotiations with owners and NPB in hopes of freezing merger Players strike on September 18 and 19 Online commerce company Rakuten announces it will sponsor a new team November Tōhoku Rakuten Golden Eagles is officially recognized 2005 First interleague games played Inaugural Asia Series among champion teams in each country won by Chiba Lotte Marines Independent Shikoku Island League formed 2006 Japan wins first World Baseball Classic with team composed completely of professional players 2007 Introduction of Climax Series as new postseason playoff format 2009 Japan defends WBC title 2011 Standing national team, nicknamed Samurai Japan, formed

(Created by the Nippon.com editorial department.)

Reforms Breathe Life Back into the Sport

The introduction of a luxury tax has been looked at as a way to raise the means of financially struggling teams. The reason for the tax has traditionally centered on the Yomiuri Giants, whose popularity has historically endowed it with unrivaled financial clout. Recently, however, avid support for regional teams such as Rakuten in the Tōhoku area and Softbank in Kyūshū, along with the appearance of financially savvy parent companies has lifted the economic fortunes of many ball clubs to levels comparable to or even higher than the Giants. As a result, the once avid calls for adopting a luxury tax have largely waned.

Japan’s size can also be seen as a factor in dwindling support for the measure. In the Major Leagues, a luxury tax has been instigated as a way to help regional clubs remain competitive against teams in densely populated cities like New York, Los Angeles, and Chicago. It is hard, however, to make a comparable argument for Japan considering its smaller area and, to an extent, the ease with which people can travel between urban centers.

Even without the tax, the stature of professional baseball has by and large remained on a steady upward course since the crisis of 2004. Fans have returned, largely in part to back-to-back World Baseball Classic titles in 2006 and 2009 by national teams stocked with professional players. This newly won support has helped the NPB safely weather challenges to its integrity, including the internal tumult at the Giants front office in 2011 and a 2013 scandal involving balls designed to be more lively than established standards—leading to more home runs.