AI in media & entertainment market to reach USD $51.37 billion

The artificial intelligence (AI) in the media and entertainment market is expected to grow substantially, with a projected compound annual growth rate (CAGR) of 17.5%, reaching USD $51.37 billion by 2034. AI applications are becoming integral in enhancing user experiences through predictive analytics, recommendation engines, customer journey mapping, and audience segmentation. The industry is estimated to be worth USD $10.24 billion in 2024.

AI technology is being leveraged to upgrade content, personalise customer experiences, and boost profitability within the media and entertainment sectors. As organisations undergo digital transformation, embracing change and adaptability has become key to meeting and exceeding customer expectations. Companies are implementing modular suites of services that foster teamwork and elevate productivity, enhancing real-time decision-making and operational agility.

Machine learning and natural language processing are enhancing analytics by enabling the analysis of unstructured data. Sentiment analysis and dialogue capabilities provide a competitive edge, significantly improving decision-making processes and customer interactions.

One of the most striking trends is the widespread demand for AI-generated music. Platforms like Shazam and Spotify use AI to tailor music recommendations based on user preferences for artist, tempo, genre, and mood. AI-assisted music mastering services, such as LANDR, are revolutionising the audio production landscape by providing cost-effective and efficient solutions despite ongoing debates about their superiority over traditional techniques.

The gaming sector is also experiencing significant improvements due to AI. Automation in animation, character modelling, music composition, and content creation is not only reducing costs but also boosting productivity. AI enhances game design through improved non-player characters (NPCs), mechanics, and realistic behaviours. Personalised player experiences and adaptive difficulty settings are becoming more common and driven by real-time player behaviour analysis.

Over-the-top (OTT) platforms are also benefiting from AI integration. AI is employed to create personalised music and video content, which enhances user engagement and aids in audience growth. AI-powered advertising services like Google AdSense and AdWords are improving campaign effectiveness and conversion rates. Moreover, AI helps in media regulation by detecting and eliminating objectionable content and automating moderation tasks.

Regional insights reveal varying levels of AI adoption and innovation. In the United States, the market is predicted to see a CAGR of 11.6% over the next decade, driven by investments in AI-based virtual production software, particularly for voice and speech recognition. Germany is expected to emerge as a significant player with a 9% CAGR in AI software demand, focusing on AI applications in storytelling and content generation. Collaborations between local media companies and tech firms are propelling this growth.

China is expected to see an 18% CAGR in its AI in the media and entertainment market as companies integrate AI into their OTT strategies to enhance user experiences. Online streaming platforms such as iQIYI, Tencent Video, Youku, and Bilibili are utilising AI to offer personalised experiences, predict content preferences, and improve service quality.

In Australia, the market is experiencing a remarkable 21% CAGR in generative AI adoption within the entertainment sector. However, concerns about the spread of misinformation and disinformation have sparked calls for more stringent AI regulations. Japanese media, on the other hand, is set for an 8.3% CAGR, with a surge in AI-driven content creation across various forms of media, including virtual YouTube personalities, tea commercials, and manga.

Recent developments in AI in the media and entertainment sector highlight the growing importance of innovative AI solutions. For example, Shopsense AI is launching a retail media platform in partnership with Paramount Global, SymphonyAI is introducing a predictive and generative AI-based Media Copilot, and Samsung Electronics has showcased its new Bespoke AI home appliances. Collaboration between Deluxe and AppTek aims to enhance content localisation and workflow efficiency via AI-driven solutions.

Saudi Arabia's launch of the AI Center for Media and Future Camp of Generative AI for Media aims to bolster the nation's media capabilities and contribute to its GDP. The trends and initiatives in the AI media and entertainment landscape reveal a rapidly evolving sector poised for significant growth and transformation.