Leaders from Nintendo, EY, WPP, Comscore, TikTok, Spotify, Sega and more set to speak at daylong gathering in Los Angeles Is the stock market in the grip of an AI bubble? Will consumer spending collapse under the weight of inflation fueled by rising energy prices? Can Disney, Netflix and other entertainment giants build out their streaming platforms beyond video to boost profits and margins?
There’s no shortage of business trends coalescing around media and entertainment as its industry leaders converge Sept. 17 in Los Angeles for Variety’s annual Entertainment and Technology Summit, presented by EY. Hollywood is grappling yet again with a fresh cycle of technology-driven upheaval in its operations and business models. The dawning potential of generative AI promises to radically change how movies and TV shows are made.
And the distribution systems of tomorrow are not as lucrative as the pay-TV ecosystems of the previous half-century. Javi Borges, global Americas media and entertainment sector leader for accounting and consulting giant EY, asserts that entertainment companies need to also understand the sea change that is afoot in consumer tastes for leisure-time pursuits. You want to shift from having consumers to having fans and loyal supporters that interact with your product, with your experience on an ongoing basis,” says Borges, a 27-year veteran of EY.
It’s because of the stickiness of the fan.” The AI effect on the stock market has cast a big shadow over media and tech shares. Borges sees a bumpy period of adjustment in the short term as the industry sorts out processes to ensure that human creatives still oversee the work of AI’s crafty agents. With technology, the time frame between major breakthroughs gets shorter and the change gets faster,” Borges says.
But I think it democratizes the cost of filmmaking.” One concerning macroeconomic trend on the horizon that could impact the entertainment sector even more than AI in the near term is the pressure on consumer prices. The war in Iran and the ripple effects of on-again, off-again tariffs and related supply chain disruptions are seen at the supermarket and the gas pump and everywhere else consumers feel the sting of rising prices. Layoffs in key sectors such as tech, banking and entertainment have also put pressure on pocketbooks.
The wobbliness of consumer spending coupled with a steady decline in the rate of personal savings held by the average American has raised red flags for entertainment sector economists. Both companies have articulated a vision for Disney+ and Peacock, respectively, to grow beyond video subscriptions to serve as a funnel for attracting consumers with theme parks and opportunities for experiences. The idea is to thread other Disney and NBCUniversal products and services into the streaming platforms, making them a hub of companywide activity.
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