We covered the basics of why Watson is unhappy with the franchise that drafted him and what his options are going forward, but let's go deeper on what would happen if the Texans trade their star quarterback.
What complicates this for the Texans?
Watson has a no-trade clause in his contract. This means Watson has a significant say in his destination, because he could choose not to waive the clause.
How rare is a no-trade clause?
The clause is not common and is usually done for quarterbacks only, although there are a few exceptions. Among quarterbacks, Watson, Patrick Mahomes, Drew Brees, Jimmy Garoppolo (but only in 2021), Russell Wilson and Tom Brady have no-trade inclusions built into their current contracts. Cardinals wide receivers DeAndre Hopkins and Larry Fitzgerald, who negotiated their own contracts in Arizona, also have no-trade clauses.
Does this mean Watson has all the leverage?
While it might seem like Watson has leverage because he could essentially choose which team he goes to, ultimately the Texans don't have to trade him. Watson signed a contract extension in September that goes through the 2025 season.
General manager Nick Caserio could find multiple trade offers he's happy with and present Watson with those options. But if Watson doesn't want to go to those destinations, he could have to stay and play or sit out.
The Texans also could work with Watson and his agent to come up with a list of teams he would agree to be traded to; Caserio could then work off that roll to help avoid problems down the road.
Of course, if it gets to the point where Watson is missing workouts (if those even happen in person) or training camp, the Texans might decide it's better to get something in return for the quarterback.
Under the collective bargaining agreement, the team could choose to fine Watson up to $50,000 for each day he misses during training camp. Unlike the previous agreement, the fines cannot be waived.
And because of the language in Watson's contract -- standard in deals done by the Texans -- if Watson misses mandatory workouts, there's a chance that could play into whether Watson has to pay back his signing bonus.
What has changed in the past week?
Since I wrote last week, there have been more reports about how unhappy Watson is, but the quarterback still hasn't said anything.
Most importantly, at least publicly, he hasn't demanded a trade.
On Sunday, ESPN's Adam Schefter reported multiple people in and around the organization believe Watson has played his final snap with the team. A source also told ESPN the Texans have had internal conversations about trade partners and what their quarterback position would look like without Watson.
Later in the week, team CEO and chairman Cal McNair told the Houston Chronicle he had "connected over texts" with Watson and said the Texans "want [Watson] in the loop and part of the process" as Houston searches for its next head coach.
Some fans are getting frustrated with McNair, and one person organized a protest, encouraging fans to walk the half-mile from Lefty's, the cheesesteak franchise of which Watson is a minority owner, to NRG Stadium. On Monday, Watson asked fans not to protest on his behalf.
"Although I am humbled I ask that whoever is organizing the march cancel for the sake of public safety," Watson stated in a tweet. "[COVID-19] is spreading at a high rate & I don't want any fans to unnecessarily expose themselves to infection."
A small group did take part.
Watson did tweet a photo of himself in a car on Tuesday with the caption, "I been trying to have some patience, I told my momma she should pray on it."
Would hiring the head coach Watson wants fix this?
McNair did not consult Watson before the Texans hired their general manager, which is where some of Watson's frustration comes from, so there is the hope that including Watson in the process of hiring a head coach would fix this.
For example, would hiring Kansas City Chiefs offensive coordinator Eric Bieniemy, whom Watson has publicly stated his admiration for, repair this relationship? Remember, the Texans did not request to interview Bieniemy until after the reports came out that Watson was unhappy with the process the Texans took to hire Caserio. It should be noted that Caserio is now running the head-coaching search, and the request to interview Bieniemy was made after he took over.
According to ESPN's Jeremy Fowler, the Texans are taking a hard look at Bieniemy, with Caserio "doing thorough homework on the candidate." According to Fowler, Houston's request is not an empty one, as Bieniemy, who interviewed Monday, will be strongly considered.
Along with Bieniemy, the team has announced it also has interviewed -- since Caserio was hired -- Indianapolis Colts defensive coordinator Matt Eberflus, Buffalo Bills defensive coordinator Leslie Frazier and Baltimore Ravens assistant head coach David Culley.
While hiring a coach Watson favors certainly would be a step in the right direction, it seems unlikely this one move would repair the quarterback's relationship with the Texans.
If the Texans did attempt to trade Watson, how would that work?
If Watson does demand a trade -- either privately or publicly -- Caserio could begin fielding offers from other teams.
On SportsCenter this week, ESPN's Chris Mortensen said the organizations he has talked to that might be interested in Watson said they expect there to be "double-digit teams" willing to make a trade to acquire the quarterback.
What would a trade mean for the Texans' salary cap?
Any trade of Watson will carry a charge of $5.6 million in dead money for the Texans. Because of the way his contract is structured (he is technically in the final year of his rookie deal, before his four-year contract extension kicks in), his cap charge for 2021 is only $15.94 million. In comparison, that number jumps to $40.4 million in 2022.
The reason it will be so costly for the Texans is because they paid a significant portion of the deal with Watson's $27 million signing bonus, which gets prorated. Teams do this to help them take advantage of the cap in future years.
If the Texans trade Watson, the yearly proration accelerates against the Texans as a dead money charge. The dead money on the contract is $21.6 million, which is the $5.4 million signing bonus prorated from 2021 to 2024.
This means the team that trades for Watson isn't responsible for the prorated portion of his signing bonus, just his base salary. So, his cap charges from 2021 to 2025 would be $10.54 million, $35 million, $37 million, $32 million and $32 million. The final two years of the contract are not guaranteed, but if Watson is playing this well at that point, a $32 million salary will be considered a bargain for an elite quarterback.
Because the $10.54 million in salary would be paid by the team trading for Watson, trading the quarterback would add only $5.6 million in dead money. Of course, in addition to that dead money charge, the Texans also would have to pay another quarterback, and that won't come cheap.
The dead money is likely only worth taking on for the Texans if they find a team willing to trade them a player (or players via draft picks and players on rookie contracts) that equal the productivity they believe they'll get from Watson.
Otherwise, if you're trying to compete, that's a lot of money to have on the books for someone not playing for the Texans in 2021.
Watson also could offer to return the guaranteed money to the team, which would make it easier for the Texans to facilitate a trade.
Do the Texans have a lot of salary-cap room?
No. Houston is more than $18 million over the projected salary cap for 2021. Of course, it's the cash spent so far that matters more to the Texans right now.
To help, Caserio has several contracts he can work with, such as cutting running David Johnson (which would save $6.9 million), linebacker Benardrick McKinney ($7 million), running back Duke Johnson ($5.1 million) and guard Zach Fulton ($3 million) or restructuring contracts for wide receiver Brandin Cooks or center Nick Martin.
Why can't Watson just demand a trade, similar to NBA players?
The leverage Watson does have, to make a move like Harden, is that he is a top-flight quarterback. But otherwise, the way the two leagues operate with regard to the cap are very different. NBA contracts are generally shorter than most NFL contracts (including Watson's), which allows for more movement. Because Watson signed a four-year contract extension, he lost a lot of leverage.
The biggest difference, of course, is that NBA contracts are fully guaranteed and, for the most part, NFL contracts are not. Often in the NBA, teams are willing to take on unwanted contracts in the short term as a means to free up cap space to add assets in future years. In the NFL, those players are usually cut.
In fact, the closest an NFL team has come to an NBA-style trade is when the Texans traded a second-round pick in 2017 so the Cleveland Browns would take on the remainder of Brock Osweiler's contract.
There also are fewer players in the NBA, which means trading for a star player can make an immediate impact. With the roster sizes in the NFL, it's rare that one player (outside of a star quarterback) is so dominant he demands a trade and gets to determine where he goes.
Of course, a player of Watson's caliber could be the exception to the rule.
Is there a similar situation we can compare this to?
Not that I can think of. Jalen Ramsey recently forced a trade -- he has the same agent as Watson -- but (1) Ramsey is not a quarterback, and (2) the Jacksonville Jaguars had not yet signed him to a contract extension.
This is a unique situation in Houston, and there will be a lot of people interested around the NFL as it plays out.