Key Highlights:

PwC projects the entertainment and media industry to hit $3.5 trillion by 2029, at a 3.7% CAGR.

Digital advertising will account for 80% of global ad spend in 2029, driven by AI and connected TV.

Connected TV advertising is expected to hit $51 billion as streaming media takes advantage of smart targeting.

Key Background:

The global entertainment and media business is transforming at a revolutionary pace, driven by the accelerating pace of artificial intelligence implementation in advertising and content distribution. According to its latest report, PwC reports that the future of the industry will also be significantly dependent on AI-based strategies that make marketing easier, personalize user experience, and create new revenues.

Now worth approximately $2.9 trillion, the E&M market will grow steadily to $3.5 trillion by 2029. But it will be fueled by wiser, data-driven ad technology that can deliver targeted experiences to increasingly fragmented audiences, rather than traditional content models.

One of the highest growth areas is digital advertising, already the market leader. 72% of global ad revenue in 2024 was coming from digital sources, which could jump to 80% in the next five years. What AI has brought to this boom is at the center—to enable brands to gather insights on how people behave, real-time optimization of ad positions, and creating automated content that's seen as personalized and engaging.

Streaming is also turning connected TV into a power to be reckoned with in this transition. As consumers increasingly cut the cable cord to embrace internet-delivered streaming services, their advertisers are hot on their heels. CTV offers the ideal blend of reach and targeting, and ad revenue in this segment is predicted by PwC to leap to $51 billion in 2029. Streaming services that embrace ad-supported models are particularly well positioned to take advantage of this transition.

Economic factors are also nudging toward AI-driven advertising. With inflation and geopolitical tensions affecting consumer spending, entertainment companies are finding it difficult to survive on subscription or ticketing alone. Advertisements, especially when technologically enabled, are proving to be a lifeline—enabling monetization of content without placing economic strain on viewers.

But PwC cautions that success will come not from access to technology but also from being innovative, nimble, and responsive. Media and entertainment companies must innovate, too. It takes more than automating business processes to integrate AI with business processes—there is a need for a culture shift involving experimentation, data literacy, and visionary investment in new formats and skillsets.

In summary, smart transformation is the future of media and entertainment. As AI redefines content monetization and consumption, the companies that transform to suit these innovations ahead of time will be at the forefront of propelling the industry forward.