One year ago, we began our first annual AlixPartners Media & Entertainment Industry Predictions Report by stating that “the media and entertainment industry has always been a poster child of creative destruction.”
Fast-forward to year two, and that sentence still rings true—in fact, the destruction and competition may have only grown fiercer.
AI advances have made major inroads in the past year and will continue to serve as the major technological force disrupting business and operations across the media industry. From a creative perspective, AI has further penetrated the TV and film sectors, where practical, easy-to-implement use cases with measurable outcomes will lead the way in 2025. But we don’t expect the technology to replace human talent; it should only enhance creative output. AI is also disrupting the video gaming, casino gaming, sports betting, and search markets, shifting traditional business models to meet consumer preferences.
Legacy media and advertising businesses are seeing a similar need to transform business models as subscription revenue moves from Pay TV to streaming, while advertising revenue moves from linear to digital. The continued rise of retail media will evolve where companies place their ad dollars to match consumption habits.
There will only be room for three to five dominant players within the online sports betting and iGaming industries to successfully invest at scale and grow. As others fight for market share, we predict at least one company will be forced out of the competitive arena.
Both gaming console and PC hardware sales will decline, as consumers choose to spend instead on displays and streaming devices.
AI will transform the production cycle—not by eliminating creative jobs, but by redefining roles and sparking new synergies between creative teams and technology. In fact, we predict that in 2025 there will be a lack of creatives with the expertise and skills required to use the new AI tools available.
As advertisers continue shifting budget towards digital, the convergence of the streaming services and retail media trends, coupled with the global expansion of retail media networks, will accelerate disruption within the media industry.
OpenAI, Perplexity, Amazon, and TikTok will gain further traction, signaling a new era of competition in the search industry. Google's share of the search advertising market will continue to shrink, decreasing by low single digits.
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