The 5 Desires That Will Transform Entertainment Tech By 2025

Jay Tucker, Executive Director, UCLA Anderson School of Management

The amount of innovation in enterprise technology is staggering. No CIO can keep up with all of the new products and platforms that have been touted as ‘game changing’; much less adopt and incorporate new solutions as quickly as they are developed. Technology leaders in the entertainment space have the additional challenge of driving technology innovation in a corporate culture that prizes art and storytelling above all else. With that in mind, it’s critical for C-suite technology executives to monitor the business trends that make innovation a necessity in order to stay one step ahead of the next wave of solutions.

The entertainment industry is rapidly being transformed by technology – from content delivery to AI & machine learning, new technologies have allowed entertainment studios, sports venues, and home entertainment providers to better understand their audiences, improve the entertainment experience, and align themselves more closely with consumers. While new platforms continue to enter the space, there are larger trends that will define the landscape for innovation over the next several years. Here are five trends that CIOs must prepare for:

Access:

Apple’s recent announcement about its Apple TV+ streaming service and its Arcade is the latest example of how companies are investing even more heavily in platforms that provide entertainment direct-to-consumer. Netflix, Hulu, Amazon Prime, CBS All Access, HBO Now, Disney and others are capitalizing on consumers’ desire to pay for the entertainment experiences they actually consume – but users continue to experience friction when seeking out current entertainment. The video- and gaming on demand trends will put even more pressure on entertainment companies to address content delivery, latency, and user experience. Note that 5G, and innovators like Starry will also reset user expectations regarding the quality of their unwired experience and autonomous vehicles will provide additional hours for the enjoyment of video, music, and games.

Discovery:

Subscription services vastly increase the amount of content available to a consumer at any one time, while simultaneously fragmenting the available entertainment across an increasing number of platforms. In addition, many of these services disaggregate traditional advertising, which has historically been a primary means of helping consumers discover new video, music, and experiences. The entertainment industry will continue to seek (and reward) solutions that help consumers find the entertainment experiences they are most likely to love. Recommendation engines search and other tools have created a ‘playlist culture’ that is not ideal for consumers or brands. 

The next five years will see new ventures and initiatives aimed improving targeting brand messages, integrating brands into content (in video and in interactive), monetizing content, and reducing friction in online purchases

CIOs will have to drive innovation that yields superior recommendations and incentives/rewards for active search of online libraries. AI& machine learning can help platforms drive more relevant and impactful recommendations, but human factors matter too. To address this issue, technology leaders will also have to think about their human capital – incorporating professionals with backgrounds in sociology, psychology & anthropology. And engineers from diverse racial, regional and ethnic backgrounds will be essential to ensure that automated recommendations are socially and culturally appropriate.

Advertising & Monetization:

Many of the subscription services are training consumers to avoid advertising, a critical funding source in the entertainment ecosystem. We have already seen companies like Mavatar Technologies build solutions that allow consumers to discover and shop. The next five years will see new ventures and initiatives aimed improving targeting brand messages, integrating brands into content (in video and in interactive), monetizing content, and reducing friction in online purchases. This will put even more pressure on technology leaders to push interoperability between their solutions and those of their potential partners. It may also lead to rethinking how the entertainment platforms are designed and managed.

Socialization & Immersion:

Audiences have a strong desire to connect through entertainment experiences, and live events, multiplayer video games and other entertainment experiences deliver on that desire. In the home, AR/ VR can help drive up emotional intensity, but the workflows behind the scenes will be a persistent challenge for CIOs in interactive entertainment companies. The AR/ VR ‘revolution’ is still years away, but by 2025 the hardware will be more affordable and ubiquitous than ever before – which will lead to a much larger market for premium immersive experiences. We will also see increasing efforts to utilize social media platforms to increase the emotional impact of having families, friends & communities consuming the same entertainment at (roughly) the same time. We already see ‘multitasking’ during major entertainment events like the Oscars – where the second screen activity is actually social sharing related to the action on the first screen. The coming years will see a push to integrate the social platforms directly with those entertainment experiences - which may impact how entertainment is produced and delivered.

Privacy:

Seemingly overnight, every entertainment business has also become a data and insights business. But the highly publicized examples of unauthorized access, misuse, and fraud will continue to incent significant regulatory pushback to data collection and management. California and Europe’s recent efforts to regulate digital privacy is a reflection of the principle that people have the right to communicate with each other without having to fear that they’ve sacrificed their personally sensitive information. CIOs will be called upon to be even more faithful stewards of sensitive & personal data, and it’s imperative that they find ways to protect consumers without throwing away valuable initiatives that collect data. The temptation will be to do less with data; the successful CIOs will find ways to do more with data while ensuring that their companies are trustworthy stewards of sensitive information.

By thinking beyond technology specifications and focusing on major business trends and opportunities, CIOs can start their planning for 2025 today. In the entertainment industry, there are a number of clear challenges ahead – and tremendous value will be created by the companies that solve them.