The world of entertainment is exciting and constantly changing. Whether its television, movies, satellite radio, advertising, or publishing, these industries are all extremely vulnerable because of persistent innovation and technology. One day a certain stock might be all the rage. The next day it could be poised to plunge. And that's why we've asked three of our top Fool contributors to shed some light on 2011 and provide us with their top picks in the entertainment industry for next year. Be sure to check them out!

Rick Aristotle Munarriz, Fool contributor
 My favorite entertainment stock is almost like a mutual fund trading at a steep discount. Liberty Capital (Nasdaq: LCAPA) consists largely of John Malone's eclectic portfolio of entertainment holdings. We're talking about the Atlanta Braves, a pair of CBS affiliate television stations, and a majority stake in MacNeil/Lehrer Productions. There are also small positions in entertainment giants Time Warner, Viacom, and Live Nation (NYSE: LYV). It's also holding small chunks of Denver's Kroenke Arena and the Hallmark Channel's parent company.

Liberty Capital's most valuable holding is a 40% preferred share stake in Sirius XM Radio (Nasdaq: SIRI) that is now worth roughly $3.5 billion. That's a sizable chunk of Liberty Capital's $5 billion market cap -- and nearly $7 billion in enterprise value.

Last month, Gabelli analyst Brett Harriss sized up Liberty Capital's public and private holdings. By his math, it's trading at a 40% discount to the value of its assets. Sure, there are a few dog investments in there, but the sum of Liberty Capital's parts is valuable enough to easily overlook the stinkers.

The key, of course, is Malone's ability to unlock the value of these positions without creating taxable dilemmas. Then again, it's hard to argue with his track record over the years. Of Liberty Media's three tracking stocks, this is the one that offers the perfect balance of growth and value in a single marked-down investment.

Anders Bylund, Fool contributor
 What Hollywood needs now is quality content, not another whiz-bang technology. The good news is, DreamWorks Animation SKG (Nasdaq: DWA) knows how to deliver it.

How to Train Your Dragon is a case in point: The movie has made a staggering $493 million in worldwide box office business and also gets favorable reviews from 98% of professional critics, making it the second-most admired movie of 2010 among wide releases. No. 1? That was Walt Disney's (NYSE: DIS) epic Toy Story 3. If you've been avoiding DreamWorks Animation because animated movies are child's play, I think you need to reconsider. This stuff isn't just big business -- it's also a well-respected art these days.

Shrek may be done as a tentpole franchise for DreamWorks Animation, but there are plenty of candidates lining up to replace it. Dragon already has a sequel in the works as does 2008 hit Kung Fu Panda, not to mention a cadre of Shrek spin-offs and a third installment in the Madagascar series. On top of the monetizing efforts for existing franchises, the company is also busy developing new ideas such as a mixed live-action and animation movie about shadows controlling their humans.

Content is king, and DreamWorks knows how to develop and deliver it. The company operates on fatter margins than Disney or DreamWorks distribution partner Viacom, and I've shown you how healthy the content pipeline looks. Yet the stock is priced in line with Disney's, as if DreamWorks weren't a much more efficient business.

Kung Fu Panda 2 might start changing the has-been perception around a Shrek-less DreamWorks next year. You wouldn't want to miss that ride.

David Lee Smith, Fool contributor
 I suppose it could be deemed coincidental that my assessment of the best and worst of the entertainment stocks both belong to the cable group. That, however, is the way the industry appears to have moved, especially given the likely takeover of General Electric's (NYSE: GE) NBC Universal by Comcast (Nasdaq: CMCSA), the biggest -- and I believe the soundest -- of the cable operators.

With nearly 23 million video customers, Comcast has come a long way since 1963, when Ralph Roberts -- the father of current CEO Brian L. Roberts -- and two colleagues bought a tiny 1,200-subscriber cable system in Tupelo, Miss. As a cable and broadcasting analyst early in the past decade, I first watched the company lead the cable pack with quality service to about 8 million subscribers.

It's long been clear that Brian Roberts and his top-notch team have recognized more acutely than other managements that content is indeed king in the TV business. That recognition obviously led to an unsuccessful effort to acquire Disney in 2004 and to the current deal-in-the-works with NBC U, a combination that, should it be approved, likely will benefit from Comcast's management prowess.

Further, Comcast is also testing a new TV-Internet combo box in Augusta, Ga. If successful, the device could accelerate the advancement of the still-new world of Internet programming.

As such, with all it has in the works, it's difficult to imagine Comcast relinquishing its position as the big enchilada of pay TV.