Arroyo, who had been signed to play at below-market value by Boston a few months prior to the trade, gets an extra $25 million added to his salary in the extension, which now is (I think...I'm seeing inconsistent figures in the media) worth ~$8.3 million/year on average, not including the option season. It must mean a great deal to Arroyo to receive this kind of contract extension, especially after the rather backhanded way he was treated by the Red Sox. But is it a good deal for the Reds? I raved about the Harang extension (in hindsight, perhaps too strongly, though I still like it a lot), but while I'm certainly not upset about this deal, I'm not tremendously excited about it either.
Arroyo was a revelation last year, skyrocketing from being the odd man out in Boston's rotation to becoming arguably the ace of the Cincinnati Reds pitching staff. In fact, he was so good that many in Cincinnati were understandably miffed when Arroyo failed to garner any real support for a Cy Young nomination. So the questions are, a) was his performance an indication of genuine improvement, and b) can he continue this level of performance in the future? Let's look at his recent stats:
The first thing that jumps out at me when looking at Arroyo's line from last year is that his peripherals look an awful lot like his 2004 (age 27) line. In fact, his walk rate was identical and the strikeouts occurred at about the same rate, while he gave up home runs at a considerably higher rate last year vs. 2004 (probably a GABP effect, at least in part). His 3.29 ERA looks outstanding, but that may be due to being fairly fortunate. He had a very low 0.262 BABIP (even by his standards), and Arroyo's peripherals predicted an ERA in the 4-4.1 range.
So, from the perspective of his peripheral stats, his performance last season doesn't look all that out of line the abilities he's shown in prior years--it was probably just a bit lucky. That's not to denigrate him as a pitcher. He's shown in two of his three full seasons that he's capable of being a quality big-league starter. But he's probably not going to be posting a low 3's ERA again without similar good fortune.
Nevertheless, a pitcher who can routinely post ERA's in the high 3's or low 4's while throwing 200+ innings a year could easily be worth ~$8.5 million/year in today's market (compare that to, for example, Eric Milton's contract). So can Arroyo be that guy? Sure, absolutely, I think he can be. But I have two concerns.
First, Arroyo's 2005 numbers still bother me. I've never heard a good explanation for the abysmal drop in his strikeout rate that season, nor for his recovery in '06. Watching him pitch last year (and I'm far from an expert in this sort of player evaluation), Arroyo's success seems to be largely based on his ability to locate his curveball, as that seems to be his out pitch--so perhaps he somehow lost his feel for it. If he can get the curve over when he needs to, he'll be successful, but if he loses his ability to strike players out again, he and the Reds will struggle, especially if he continues to give up the long ball like he did last year (he is definitely a fly ball pitcher).
Second, I'm concerned about whether age will be an issue. I don't want to overstate this, but Arroyo will turn 30 later this month and will be 33 years old during the 2010 season. He didn't throw a ton of innings early in his career, and didn't secure a permanent role in the majors until age 27, so his arm might hold up better than the typical aging curve would predict. Nevertheless, pitchers do tend to decline after age 30, and a loss in velocity may hurt the effectiveness of his curveball as an off-speed out pitch. To add to this point, even though I don't put a ton of stock into long term predictions, PECOTA predicts Arroyo's ERA to be 4.36 in 2007, 4.51 in 2008, 4.72 in 2009, and 4.73 in 2010.
Furthermore, Arroyo led the league in innings pitched last year (240.7) and was 6th in baseball in pitcher abuse points. Unlike Harang, Bronson isn't a big guy (though I always forget that he is 6'5") and, as Joel pointed out, he does have a somewhat herky-jerky delivery. Therefore, even though he proved to be amazingly durable last season, I think the Reds really need to watch how they use him in the coming seasons if they want him to remain effective throughout the course of this contract.
Altogether though, I'm ok with this this move. Harang and Arroyo are a great nucleus to build a rotation around in the coming years. And a few years from now, a rotation of Harang, Arroyo, Homer Bailey, and maybe Johnny Cueto could be really fun to watch.