To sports fans, the dog days of August mean that football season is just around the corner. Teams are gearing up for exhibition games, while players jockey for roster spots. They're not alone. Over their virtual shoulders look millions of fans that have more than team loyalty at stake. Yes, I'm talking fantasy football.
The Internet has pushed the phenomenon into the mainstream. Once the domain of barflies and frat boys, now everyone with an Internet connection can participate. When AOL Time Warner's (NYSE:AOL) America Online teamed up with STATS Inc. to offer Grandstand Fantasy Football, it created a monster; however, that premium service quickly gave way to free alternatives from the likes of Yahoo! (NASDAQ:YHOO) and SportsLine.com (NASDAQ:SPLN).
As the dot-com business model evolved from attracting eyeballs toward attracting profits, the sites realized that football fanatics might willingly go back to paying for online commissioner services if the free alternatives dried up. So far, they're right.
Last month, SportsLine posted a narrower loss and reported positive trends in fantasy subscription business as it heads into its seasonal strong period. Last year, SportsLine generated $9 million in revenue from 850,000 fantasy football signups. That's a big chunk of the $62 million in total revenue SportsLine made in 2002.
The much larger Yahoo! has less riding on pigskin prognostication, but it too charges for many of its fantasy services, offering just a bare-bones package for free.
What does the National Football League think of all this? The NFL is tickled. The league teamed up with SportsLine this year to offer premium fantasy football leagues in a deal that finds the parties sharing subscriber fees and merchandising revenues. But where's the line between condoning gambling and offering a fantasy league in which users pay to win prizes? Isn't the NFL offsides?
The game's just getting started. Let's hope the NFL manages to keep fan excitement high without fumbling away the ethics of the game.
Did you stay up late over the weekend watching the Bucs and Jets play a game that didn't matter? If so, maybe you're a football addict. Who is going to win the Super Bowl this year? What's the deal with the Philadelphia Eagles forgetting to put water fountains in the team's new stadium? Was Tommy Maddox a fluke last season? All this and more -- in the 77's Foolish House of Pigskin discussion board. Only on Fool.com.
