What Investors Should Know as Football Season Approaches

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A new version of Madden from Electronic Arts ( EA ) came out for iOS ( AAPL ). Rupert Murdoch unveiled his new, lavishly funded sports network to compete with ESPN ( DIS ) last week. And McDonald's (MCD) officially announced a rollout of bone-in chicken wings; a promotion that will run through the fall.

In other words, it's football season.

Football is by far the most popular sport in the US. In fact, if you count college sports and professional sports separately, football is the first and third most popular sport -- beating out NASCAR and professional basketball. It's kind of a big deal.

So if you're wondering whether Oregon undergrads really need chairs with the same leather found in Ferraris, you're missing the point. Louisville, once a middling Kentucky commuter school, has quintupled its research budget in the last 12 years, simply by moving games to Tuesday in a deal with ESPN. Viewership of Louisville games has since skyrocketed - leading to new donors, recruits, and sports stadiums. And some of that money is even financing efforts in the classroom.

When it comes to the entertainment industry, football is king, and that can cause some inconsistencies. As disgruntled executives from the content provider Viacom ( VIA ) point out, Disney's ESPN gets to charge more from cable providers than Viacom does for all of its other channels combined . ESPN is four times the cost of the next most expensive channel.

ESPN's practices have even garnered the attention of the FCC and the Justice Department. Both organizations have looked into the network's practice of buying rights to more games than it can possibly air, considered an anti-competitive practice. However, there's still some market share for Fox Sports, which already has an extensive collection of offerings in its portfolio, including a 49% stake in the Big Ten Conference.

The impact of football on the current media landscape is undeniable - in fact, some would argue that it's literally the only thing keeping traditional "bundle" cable packages around. Senator John McCain, among many others, wants to allow customers to purchase channels individually. Therein lies an elusive target for the tech sector. Companies like Google ( GOOG ) are pursuing sports-streaming options of their own, which would allow viewers to drop cable altogether. However, the lengths media companies will go to protect their air-rights - Disney donated $400,000 to politicians who deal with this sort of thing since 2000 - shows just how important football is to a number of different markets. And we're only getting started.

Click here for an interactive chart that shows analyst ratings over time.

Editor's note: This story by James Dennin originally appeared on Kapitall .

Kapitall's lists break complex concepts down to their basics, offering education and investing ideas to novices that double as a refresher course for more seasoned investors. Inspired by video game design, Kapitall's revolutionary brokerage platform combines a graphical user interface with tools that make it easy to build portfolios, share ideas and execute trades.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Stocks

Referenced Stocks: AAPL , DIS , EA , GOOG , VIA

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