Dave Gilbert here, Editor of Smart Money.
We Americans love our sports.
We play it as kids. We watch it as adults. We’re passionate about our favorite teams, both professional and college. And we can find a sporting event on TV at almost any hour of any day.
They are fun, entertaining, can teach us valuable lessons, and are a great distraction from the problems of the world – like inflation and stock market selloffs.
Anything that popular means money. When it comes to sports, we’re talking about a lot of money.
A big chunk of it is tied to the NFL, which started its season this past weekend. Forbes ranks the Dallas Cowboys as the most valuable sports team in the world, worth $8 billion. That value has appreciated 73% in the last five years, easily outpacing the S&P 500’s 60% gain in that same half decade.
In fact, four of Forbes’ most valuable teams in the world are in the NFL. The Cowboys are followed by the New England Patriots ($6.4 billion), Los Angeles Rams ($6.2 billion), and then a tie between the iconic New York Yankees baseball franchise and the New York Giants football team (both worth $6 billion).
The three major sports – football, baseball, and basketball – were all invented more than a century ago. And those five teams have average 78% appreciation over the last five years.
How do these sports continue to grow in popularity and value?
Improved equipment. Updated rules. Evolved strategies. The athletes themselves get faster, stronger, and simply better.
But… don’t underestimate the impact of technology on sports and our fandom. Thanks in large part to next generation 5G wireless connectivity, there are more ways than ever to watch sports and even experience sports.
It’s yet another reason investors should be aware of what’s coming…
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Experincing Sports at a Whole New Level
When it comes to watching sports, something we all take for granted now is instant replay – both on television and inside the stadiums and arenas.
Within seconds, we can rewatch what just happened at regular speed, in surprisingly clear slow motion, from multiple camera angles, and even through additional angles generated through artificial intelligence.
We can watch games at a level probably not even dreamed of when the first instant replay was used in 1955 during a Hockey Night in Canada broadcast. It took several minutes to get one replay ready, and it could only play at regular speed. Slow motion didn’t come along for seven more years.
At the most basic level, 5G improves our access to a live sporting event anytime anywhere. Previous generation wireless networks enabled us to watch live events on our mobile devices – not to mention recorded replays – but the speed and reliability of 5G makes it as smooth as cable television.
Streaming builds on capabilities that have been growing for years, but 5G enables other breakthroughs that impact our sports viewing – or, should we say, breakthroughs that “change the game” – even though we may not realize it.
One big way is the real-time data collection enabled by 5G. This brings statistics and player tracking to a whole new level.
You’ve probably seen the ads for Amazon Next Gen Stats used in NFL broadcasts. The 2019 Pro Bowl was the first NFL game where fans could follow live player movements. The NFL said at the time that Next Gen Stats “captures player location in real-time, generates over 200 stats per play, and charts individual movements within inches.”
The National Hockey League now has 5G networks in all of its arenas. The applications are starting with puck and player tracking, providing such data as how fast a player is skating or how many miles per hour a shot was traveling.
Last year, Verizon Communications Inc. (VZ) and the New Jersey Devils tested technology that would allow fans to point their phones at players to see how fast they were skating and get access to other stats, both historical and in that game. Looking down the road, the NHL hopes to build on this 5G and cloud infrastructure to offer augmented and virtual reality.
In the NBA, the Phoenix Suns new practice facility is even named the Verizon 5G Performance Center. The 5G network collects data from 150 camera, sensors, and more to track ball movement, player movement, shots, and just about everything else into one integrated system.
And then there is sports betting. In 2018, a Supreme Court ruling left it up to individual states to decide whether to legalize sports betting or not. More than half have done so, and much of the wagering is done on mobile devices. Increasing adoption of 5G networks is expected to be a major factor in sports betting’s projected growth to $144 billion by 2026, according to The Business Research Company.
The number and variety of bets is almost beyond belief. In last night’s Monday Night Football game, one “prop” bet was whether Seattle’s new quarterback, Geno Smith, would attempt fewer than 30.5 passes in the game. (He did. He threw 28.)
The Big Potential of 5G
All of these devices collecting and analyzing all of this data in real time can only happen with the speed and reliability of 5G. That’s why it is sometimes called a “keystone” technology. It makes possible so many of the breakthroughs we are seeing today, like artificial intelligence, self-driving cars, and the Internet of Things (IoT).
Some of those connected “things” are now athletes, coaches, TV networks, and watching and betting on those athletes and coaches.
This is where Eric Fry has always seen a big opportunity…
By 2025, more than 40 billion “smart devices” will connect to the global network to become the Internet of Things (IoT). 5G networks will make these devices even smarter by enabling them to conduct edge-computing functions at blazing-fast speeds, in combination with artificial intelligence and machine learning processes.
As a result, connected appliances like smart locks, smart thermostats, smart security cameras, and many other products [editor’s note: like smart umpires?] will not only operate more reliably, but they will also “learn” to perform their specific functions more intelligently.
This opportunity is still in its infancy, which means it will produce a growing list of winners over time.
The companies that understand what’s happening and harness this powerful new 5G network to improve or create entirely new services and industries could quickly grow and become the next Amazon or Netflix.
It’s the same with investors.
Those who understand that 5G is a much bigger story than faster smartphones… and understand that the last few hype-filled years was just the build-out phase and not an empty promise… could make incredible gains as this story plays out.
That’s why 5G is one of the megatrends Eric follow closely as he recommends specific 5G tech plays in Fry’s Investment Report. (Learn more about how you can get access to those picks here.)
Based on estimates from industry sources, Eric has reported that 5G networks will generate a whopping $56 trillion in global sales activity by 2050. We can “bet” that sports will a big part of that. And we can “bet” that investors will see good opportunities to make money.
Regards,
Dave
On the date of publication, Eric Fry did not have (either directly or indirectly) any positions in the securities mentioned in this article.
