The San Francisco 49ers made headlines yesterday when news broke that they had signed quarterback Colin Kaepernick to a massive new contract. The initial details that were reported on the contract indicated that there would be $61 million guaranteed on the six-year extension, and as much as $126 million in total money on the deal.
Of course, fans of the Green Bay Packers saw those numbers and immediately jumped to the conclusion that the 49ers were foolish for giving Kaepernick money that's roughly equivalent to what Aaron Rodgers got in his new contract (5 years, $110 million in new money). However, we learned more about the Kaepernick deal overnight thanks to Pro Football Talk, and the two deals show a distinct difference in the two franchises' approach to and faith in their quarterbacks.
The first major difference is the way in which the teams "guaranteed" each player's guaranteed money. I apologize in advance that the "G" word will be used so excessively in the next few paragraphs, but there's no way around it.
Rodgers' deal had $54 million guaranteed, consisting of his $35 million signing bonus and his roster bonuses for the 2014 and 2015 seasons -- each worth $9.5 million. That money was guaranteed on the day that Rodgers signed the deal, so there is no possible situation which would cause Rodgers to get a penny less than that $54 million.
Unlike the guarantees in Rodgers' contract, Most of Kaepernick's so-called "guaranteed" money isn't really guaranteed at all. According to PFT, just over $13 million is a true guarantee, which consists of Kaepernick's signing bonus, 2014 salary, and workout bonus. The base salaries for the next few seasons are also described as guaranteed and are included in the $61 million figure, but are really only guaranteed for injury purposes. The 49ers would be able to cut Kaepernick before April 1st any year after 2014 and would not owe him another penny (though they would absorb any remaining prorated cap hit from his signing bonus, but would still save substantial cap space in any year of the deal.)
There's also one other catch to Kaepernick's deal, which is in all practicality the reverse of an incentive. The stipulations are that Kaepernick needs to play 80% of the 49ers snaps and either San Francisco plays in a Super Bowl OR Kaepernick is a First- or Second-Team All-Pro quarterback. For each year that passes without those stipulations being met, the team knocks $2 million off the total amount of the contract. The only reason I can come up with for wording it this way instead of in reverse (earning extra money if he achieved those goals) is to make the total value of the contract appear bigger.
If Colin Kaepernick finds the game that he has showed against the Packers over those past two years, this will be a great deal for the 49ers. If he can play like that consistently throughout the regular season and playoffs in the coming years and lead San Francisco to more Super Bowls, the 49ers will be getting a bargain, especially considering the contracts recently signed by players like Joe Flacco (6 years, $120.6 million) and Jay Cutler (7 years, $126 million) and the likelihood that Kaepernick will probably be getting paid less per year than players like Andrew Luck and Russell Wilson.
However, it is clear from the structure of this deal that the 49ers think that Kaepernick can become an elite quarterback but are not willing to risk the team's financial future on it. Giving themselves the ability to pull the plug in the offseason with no detrimental effect on the team is clear evidence of this. In essence, both the team and Kaepernick himself are betting on his ability to become an elite QB; however, the deal carries far more risk for the quarterback than for the 49ers, since the team has given itself numerous ways out if his play goes south.
On the other hand, the Packers' latest contract with Aaron Rodgers came under drastically different circumstances. He had five years as a starter under his (championship) belt, had already led the franchise to a Super Bowl win and had earned an NFL Most Valuable Player award, as well as worked himself into being a consensus top-5 quarterback in the NFL. There was no way his agent, David Dunn, would allow the team to include "out clauses" like the ones in Kaepernick's deal, and nor should he have. Rodgers is the most critical player on the team and his contract reflects that in both its overall value and true guaranteed money. Rodgers proved before he signed that he was already worth the kind of deal that he received; for many (myself included), Kaepernick has yet to do so, and the 49ers were smart to be cautious.
To wrap up, the Kaepernick deal is a lesson in a few things.
First, so-called "guaranteed" money isn't really guaranteed any more. Second, reacting to the overall numbers of a deal is foolish (something that the Baltimore Ravens media staff needs to learn) -- it's important to wait to react until learning the full details. Finally, teams are getting more creative in minimizing their risk when signing players to big contracts, and are becoming more willing to offer up more money in total contract value in exchange for a greater ability to get out of the deal early. Either way, the 49ers should come out of Kaepernick's deal looking smart.