Business opportunities provided by generative AI and deals are among the focus areas for media and entertainment executives, accounting and consulting firm EY found in a new survey.
It questioned 150 U.S. media and entertainment sector board members, C-suite executives and their direct reports to gather insights into their state of mind and likely trends.
More from The Hollywood Reporter
“Media and entertainment (M&E) companies are used to drama — they make their living from it — but the pace and scale of disruption in 2023 had M&E executives reflecting on how best to navigate the next evolution of their industry,” EY said in its report on takeaways.
Among the findings, 83 percent of respondents said “they must execute on M&A opportunities to achieve their strategic goals,” and 97 percent believe that there are “lasting benefits from M&A activity,” the firm noted. “However, they cited lack of capital and content rights as the biggest hurdles to overcome in further consolidation of the M&E industry.”
Amid the recent return to deal chatter across Hollywood and beyond, EY also highlighted that “over a third of respondents believe that none of the traditional legacy M&E conglomerates today will exist as standalone companies in three years’ time.”
With or without deals, reducing headcount is “a critical priority” for 33 percent of sector companies, EY noted based on its conversations.
Late in 2023, EY’s Americas media & entertainment leader John Harrison predicted that generative AI will remain a core focus for Hollywood in 2024. Now, EY’s survey had more than two-thirds of respondents say that generative AI will “speed up the process of content creation.”
It also found that 60 percent expect AI to have “a positive disruptive impact on business performance in three years.” And a majority identified streaming, advertising, video games and sports betting as the areas that will see the biggest impact.
It comes as no surprise then that “deploying AI solutions is a critical priority” for nearly 50 percent of media and entertainment companies, according to the EY survey.
With continued disruption and “massive shifts” on the horizon, executives have an opportunity to “seize the moment to strengthen their businesses,” EY concluded.
“Our findings suggest that M&E companies are zeroing in on optimizing content and media business portfolios and harnessing artificial intelligence (AI) and generative AI (GenAI) to help rekindle their growth ambitions and create sustained resiliency,” the consulting firm summarized the takeaways from its survey. “They are also taking a serious look at how to future-proof profitability by continuing to consolidate, create new partnerships and streamline operations to permanently reduce expenses.”
Best of The Hollywood Reporter