DC Discusses at The Montgomery Summit: The future of AI in media

"Organizations should be asking themselves ‘How should we pursue AI?’ rather than ‘When should we pursue AI?’"

2022 marked a shift in the geopolitical landscape, which presented a challenging economic outlook, prompting media companies and potential investors to pause and reassess. Amidst this uncertainty, an emergence of new consumer behaviors has given rise to lucrative media prospects.

Organizations are adjusting to consumer shifts by identifying how and where their consumers are interacting with the established media outlets. Artificial intelligence, or AI, has rapidly become a major focus for technology investors this year. At the conference, much of the discussion focused on AI stepping in to help media companies maintain a competitive edge in the digital age, where digital strategies in business plans are significant and have emerged as key revenue sources.

We observed strong enthusiasm for its use within business operations, as organizations strive to unlock its potential value.

Market landscape…

• AI presents lucrative growth trajectories for media companies – Some organizations are utilizing AI in an effort to bring efficiencies to content creation, such as Buzzfeed. BuzzFeed's successful incorporation of AI-generated content for quiz generation contributed to an initial 300% bump in their stock price from 95 cents to $3.87 in January this year, settling in March to around $1.42[i]
• More streaming services may be launched – Numerous media companies are launching new streaming services, as paid over-the-top (OTT) platforms are on the rise, alongside established players like Netflix, Hulu, and Amazon Prime Video, utilizing machine learning techniques to analyze movie trailers and predict their future audiences[ii]
• Due diligence is key to unlock value - AI Implementation is leading to tech layoffs in some instances. CNET had been using AI tools to produce content since November 2022, but it was reported in January 2023, that over half of those articles had needed corrections to factual errors. On January 20 2023 [iii], it was announced that the AI-generated stories would be paused and that 10% of the workforce would be laid off to simplify operations.[iiii]

What’s next…

Companies that can utilize AI diligently and effectively may be sought after for acquisition by larger companies looking to expand their technological capabilities, it is too early, however, to know what the long-term effects will be and that is complicated by the underlying instabilities yet to be addressed. As an industry, it is essential that we focus on the quality of data that goes into and comes out of our products. Organizations can mitigate the risks of applying artificial intelligence by first asking “how should we pursue AI?" instead of “when should we pursue AI?”.

This year, we anticipate attention will likely be directed towards bridging the gaps and addressing existing challenges. Strategic advice and due diligence are key for market operators seeking to unlock the potential value that AI implementations can provide.

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[i] https://www.theguardian.com/media/2023/jan/26/buzzfeed-artifical-intelligence-content-quizzes-chatgpt 

[ii] https://www.businesswire.com/news/home/20230221005506/en/Europe-Over-The-Top-OTT-Market-Report-2023-Several-Regional-Players-Look-to-Cut-Into-Netflixs-Dominance---ResearchAndMarkets.com

[iii] https://mashable.com/article/cnet-pauses-ai-bot#:~:text=After%20major%20backlash%2C%20CNET%20told%20its%20bot%20to%20stand%20down.&text=CNET%20has%20hit%20the%20pause,Opens%20in%20a%20new%20tab)  

[iiii] https://www.theverge.com/2023/3/2/23622231/cnet-layoffs-ai-articles-seo-red-ventures