The last two weeks of September were a great time to be in Los Angeles - the Writers strike was settled[ii] and negotiations between AMPTP and SAG-AFTRA were announced[iii], and we were able to attend both Variety’s Entertainment & Technology Summit and CODE 2023. Thankfully, the only picket line we had to cross was at the hotel on the final morning.

Intellectual Property and protection is more important than ever

The recent and anticipated strike settlements in the entertainment industry will have a significant impact on content production and distribution. We believe the cost of content for linear, streaming, and theatrical release will increase, while the quantity of content produced will likely decrease. Costs will increase in part due to adjustment in payments for ‘hits’ - success based bonuses – and minimums on the size of the writers’ room.[iv], resulting from the settlements and anticipated similar adjustments for SAG-AFTRA members'.

The strike negotiations have also raised awareness of the risks posed by AI, including the ‘fair use’ argument in defending Large Language Models (LLM) training practices. LLMs are trained using available text and code, which frequently includes copyrighted material. This has raised concerns about copyright infringement and the potential for LLMs to be used to generate unauthorized content. During Microsoft CTO Kevin Scott’s session at CODE, DC Advisory US’ Gretchen Tibbits asked about their training practices for their AI tool. He stated that they believe that the data they have used falls under fair use, insisting that they certainly do not want creators to be disenfranchised and/or not reap benefit of their work[v]. There are a number of active lawsuits contesting that assumption[vi]. At CODE, the CEO of Getty, Craig Peters, outlined their radically different approach[vii] in how they were incorporating AI to ensure ‘fair use’. He explained the IP that the tool is trained upon is expressly permissioned and financial returns are shared with the creators of the content.[viii]

Creators, influencers, and brands are recognizing the importance of delivering high-quality content that connects with their audiences while retaining ‘authentic’ messaging. At the Variety Entertainment & Technology Summit, Mattel’s CEO, Ynon Kreiz, spoke on the recent success of the Barbie movie and how it is one component of a long-range deliberate strategy to manage intellectual property as entertainment franchises, creating multiple touch points for fans[ix]. He described how customization across the variety of platforms/mediums, experiences, and products is paramount to creating a direct connection between the artist / influencer and the audience.

Importance of data & analytics

To date, streaming platforms have been relatively opaque about their viewership data. However, there is an expectation that, coming out of the strikes, studios and streamers will be sharing more viewership information. [x] Neutral data providers will be necessary to provide quality data across platforms and providers, showing the market in totality. to summarize how one studio research executive put it at CODE, it is imperative that data is built into an emotional argument, emphasizing the concept that numbers do not change minds, hearts change minds. It is through this approach that the data can be used to create what feels like a direct relationship for fans – identifying them on social platforms, customizing experience by platform, and incorporating more precise targeting campaigns. The overall effect is the approximation of one-to-one versus one-to-many interactions.

Speaking on this topic on stage at the Variety Summit, Universal Music Group’s President of Global e-Commerce and Business Development, Richelle Parham, explained that the artist must be at the center of the conversation in order to facilitate meaningful interactions with fans - leveraging data and analytics makes this possible as they can make one-to-many interactions feel like one-to-one.[xi]

The importance of data & analytics extends to digital media as well. The regulatory sunsetting of third-party cookies has magnified the value of and need for first-party data and created significant monetization challenges for those that have not been able to capture that information from their visitors.

Need for sustainable business models

The ‘scale at all costs’ model, prevalent in the streaming industry in recent years, is coming to an end. Some of us find the cycle reminiscent of the early days of the internet – late 1990’s - which lead to the bursting of the dot-com bubble in the early 2000’s. Casey Bloys, Chairman and CEO of HBO and Max, spoke on the topic at CODE and in summary, stated that the content boom is over, and all companies are under pressure to maintain linear and streaming and ultimately make a profit[xi]. Additionally, JB Perrette, CEO and President of Global Streaming and Games spoke on this recently at the Variety Summit and in further interviews, referring to the last decade as one of ’great oversupply and great under-pricing' bringing us now to a period of ’embracing rationalization and aggregation [process]’.[xii]

We believe one of the main reasons identified for this shift is that the industry has been creating too much content and ‘giving it away’ in the pursuit of attracting and retaining subscribers. We expect the cost of premium content will likely continue to rise after the strike settlements. Industry focus will likely shift to creating content that can be monetized through both subscriptions and advertising. This will also likely lead to greater emphasis on finding multiple touch points with audiences and generating revenue directly from the consumer. 

What does this mean for the M&A markets?

Irrespective of external conditions, the media & entertainment industry is primed for a better year in 2024. The strike settlements will bring new content into the eco-system, resulting in increased consumption, stabilized/increasing subscriber bases (despite some anticipated consolidation), and increased advertising opportunities (both on the new content and in the growth of adoption of advertisement supported tiers). Additionally, the US national and local elections as well as the Summer Olympics should drive increased advertising expenditures.

While many economists are conservative regarding overall economic conditions for the remainder of 2023 and 2024 [xiii] we are optimistic, believing whether or not interest rates fall, that there will be a return in M&A activity volume in 2024. We believe that these trends will drive deal flow in the industry as we look towards 2024 –

  • Consolidation of content companies, primarily amongst independent Advertising Video on Demand (AVOD) and Free Ad Supported Streaming Television (FAST) services and subscale and generalist digital media companies.
  • Growth of “niche” content companies and expansion of their offerings across platforms and products, as discussed at CODE by Allen Media Group’s Founder, Chairman and CEO, Bryon Allen. He spoke on the group’s mission to build a global platform by going local, based on the belief that everyone should be able to access local news and weather for survival. He stated that this need is the reason he made the bid for ABC network. 
  • Increased valuations of companies providing key technology products
    • Those that increase monetization
    • Measurement platforms
    • Data & analytics tools
  • Increased availability of capital to enable the growth of -
    • Smaller and mid-size companies especially those with a niche/targeted focus
    • Drive consolidation of mid-size, private entities
    • Provide go-private opportunities for small-cap businesses

To discuss any of the themes in this piece further - or to get the take from someone who was in the room for CODE 2023 - get in touch with Gretchen Tibbits here >


This article has been prepared solely for information purposes and is not intended to function as a “research report.” In particular, this means that it is not intended, nor does it contain sufficient information, to make a recommendation as to the advisability of investment in, or the value of, any security.   

Additionally, this article does not constitute or form part of, and should not be construed as, an offer to sell, or a solicitation of any offer to buy, or any recommendation with respect to, any securities. You should not base any investment decision on this article; any investment involves risks, including the risk of loss, and you should not invest without speaking to a financial advisor. 

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[iv] WGA New Contract After Strike: AI, Writers Room Staffs, Residuals (

[v] - recording from 33:38 - 38:05






[xi] Variety's Entertainment & Technology Summit 2023 Biggest Takeaways

[xii] The Code Conference 2023: news, interviews, and more - Page 3 - The Verge


[xiv] ;