Depends on how you look at it. In terms of length, while college coaches such as Charlie Weis and Kirk Ferentz have signed 10-year contracts in years past, there's not really a precedent for this sort of deal in the NFL. Coaching contracts aren't public record, but the longest deal I'm aware of is the six-year contract Kyle Shanahan signed to work alongside John Lynch in San Francisco last year.
The Raiders could be stuck absorbing an enormous bill if the contract is fully guaranteed and Gruden doesn't work out, given that they would be unlikely to benefit from an offset. Gruden probably wouldn't be in a rush to take another job if he doesn't crack it in Oakland, and even if he did, he wouldn't be in line to get $10 million again. The Raiders didn't appear to be negotiating against any other teams, so it seems they probably could have gotten away with giving Gruden a six-year deal and insulated themselves from an extra $40 million in entirely downside risk. If Gruden succeeds, the Raiders will surely just rip up this deal after a few years and give him a new extension anyway.
By salary, though, $10 million isn't outlandish by a long shot. Bill Belichick's contract is under wraps, but ESPN's Chris Mortensen has suggested Belichick makes more than $10 million per season. Nick Saban took home $11.1 million at Alabama in 2017. You'll note that they're both the coaches of the reigning champions at their respective levels. This is the market for high-end coaches.
If anything, though, those leaders -- and the majority of truly great coaches -- are underpaid at the NFL level, and Gruden is one of the reasons we know this to be true. Back in 2012, I wrote about Jim Harbaugh and how he was underpaid in making $5 million per year.... There's no way to perfectly gauge what a coach is worth, but one piece of evidence we have is how much coaches have cost to acquire via trade.
There are two notable head-coaching trades from the past 25 years of football.
The New York Jets traded Belichick for something close to the 12th pick in the draft in 2000, after you account for the value of the various draft selections sent each way. The Jets had little leverage in the deal, given that Belichick was essentially holding the team hostage in an attempt to move to New England.
On the other hand, Raiders owner Al Davis held significant leverage when he agreed to trade Gruden to the Buccaneers before the 2002 season. The Buccaneers sent the Raiders two first-round picks, two second-round picks and $8 million as a transfer fee to acquire Gruden, who then promptly led the Buccaneers to a Super Bowl win over the Raiders in his first year at the helm. You suspect the Glazer family has bankrolled worse purchases during its time owning sports teams.
Think about that haul: It's the sort of deal you only see when teams acquire young franchise quarterbacks with years of team control available. It's the sort of trade you would see from a team moving up to grab a quarterback with the first overall pick. The Rams sent two first-round picks, two second-round picks and two third-round picks to the Titans for the first overall pick and fourth- and sixth-round selections as part of the Jared Goff deal.
On a veteran level, forget Jimmy Garoppolo; we're looking at a deal similar to what the Broncos got for Jay Cutler in 2009, back when Cutler was 25 and coming off a Pro Bowl season in Denver. The Bears sent two first-round picks, a third-round selection and Kyle Orton to acquire their quarterback of the future. Perhaps the Gruden trade is an outlier, but I'd be skeptical. What do you think the Browns would be willing to pay to snatch away Sean McVay from the Rams right now? What would the Giants be willing to deal for Belichick?
Those rookie quarterbacks can't negotiate contracts because they're on rookie-scale deals (which is one of the main reasons why teams value them so highly), but we know that Cutler received a two-year extension at what was then upper-echelon quarte... several months after the trade. Cutler's deal in 2009 guaranteed him $20 million and paid him an average of just over $10 million per year, despite having three years left on his rookie deal. It also came when the league's salary cap was at $123 million. Next year, when Gruden's deal begins, the cap is likely to settle somewhere around $176 million, or 43 percent higher.
The current going rate for an above-average quarterback's contract extension -- let alone a guy hitting the free market -- is around $25 million per year. Andrew Luck picked up $75 million over the first three years of his new deal. Derek Carr's five-year extension is for $125 million. Matthew Stafford exploited his leverage to top those deals and make $29 million per year over the first three seasons of his extension with the Lions. And none of those quarterbacks is even a top-tier perennial MVP candidate.
It's logical to infer that top-tier coaches -- who can't get injured, remember -- are worth something in the $20 million range on an annual basis. With that in mind, paying Gruden $10 million per year is hardly out of line. Again, I'd take issue with the length of the contract as reported, but if Gruden is a very good coach, the Raiders will be getting a bargain. Read More Here