What’s a Free Agent?

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Free agency allows professional athletes to sign with any team they wish after fulfilling their original contract. It was introduced in 1975 after an arbitrator ruled in favor of two baseball players. While it allows athletes to earn more money and choose their team, critics argue it leads to higher ticket prices and decreased team loyalty. There can also be a competitive divide between teams with different financial resources. Leagues have guidelines in place to address this.

A free agent is a term used to describe a professional athlete who is not signed to a professional sports team and is free to sign with any team they wish. An athlete can typically become a free agent after fulfilling the term of the original contract she signed with a sports team. The era of free agency changed professional sports dramatically and allowed for the large salaries many athletes earn today.

Before the advent of free agency in the United States, professional athletes were essentially tied to the team they originally signed with. If a team did not want to renew a player’s contract, they could place him on a “reserve list” which prevented other teams from signing the player. Professional athletes therefore had little hope of playing for another team unless they were traded or released from their contract by the original team.

All of that changed in 1975, when US Major League Baseball players Andy Messersmith and Dave McNally challenged the traditional interpretation of player contracts. An arbitrator ruled that the player’s original teams no longer had any contractual rights against them and became free agents. This paved the way for more athletes to choose free agency in baseball, which eventually led to free agency in every major professional sport in the United States.

Professional athletes generally like the free agent business model because it allows them to make more money than they likely would have without it. When a player becomes a free agent, any team can bid on his services, which usually drives up the price for the player. For example: In 2000 Alex Rodriguez, who played for Major League Baseball’s Texas Rangers, signed a record 10-year, $252 million United States Dollar (USD) contract with the New York Yankees. Free agency also allows a player the freedom to select the team he wants to play for.

Critics of the free agent system believe that the often exorbitant salaries paid to free agent players have led to higher ticket prices and costs associated with attending a professional game. In 2007, the average cost of a ticket to a U.S. National Football League game was approximately $68.00 USD, an increase of 7.1% from the previous year. Fans also have to adjust to their favorite players leaving for another team, which can lead to disappointment, decreased team loyalty, and a sense that players are not loyal to their fans and teams.

Additionally, there is often a large disparity between what owners in larger cities and markets are able to pay free agents, versus owners in smaller markets and cities. When some owners are able to consistently outperform the rest of the market for free agents, it can lead to a competitive divide between teams. This is generally not considered good for professional sports leagues as a whole, as parity between teams is usually the goal. To address this situation, many professional leagues have guidelines and restrictions in place to handle the free agency process.

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