EY Reports AI Set to Boost Media and Entertainment Revenues by 10% While Cutting Costs by 15%
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The global media and entertainment (M&E) industry is on the cusp of a technological revolution, with Artificial Intelligence (AI) poised to deliver a substantial financial impact. According to a new report by Ernst & Young (EY), titled A Studio Called India: Content and Media Services for the World, AI set to boost Media and Entertainment revenues by 10% and reduce costs by 15% for companies in the sector, fundamentally reshaping how content is created, distributed, and monetized.
AI: The New Engine of Growth for Media and Entertainment
The EY report, unveiled at the inaugural WAVES Summit in Mumbai, highlights a dramatic transformation underway in the M&E landscape. AI is becoming integral across the value chain- from content generation and curation to monetization and distribution. “Our analysis indicates that in the medium term, AI can increase revenues by 10 per cent and reduce costs by 15 per cent for media and entertainment companies,” the report notes.
This transformation is not limited to back-end operations. AI is actively reshaping creative processes, campaign optimization, and audience engagement. Over-the-top (OTT) platforms are leveraging AI to deliver hyper-personalized recommendations, tailoring content based on language, location, income levels, and individual viewing behaviors. In advertising, AI is enabling dynamic ad insertions and smarter pricing strategies, driven by real-time viewer analytics.
AI’s Impact on Media & Entertainment (EY Report)
Aspect |
Impact |
Details |
|---|---|---|
Revenue Growth |
+10% Increase | AI-driven content personalization, better audience targeting, and automation of creative processes boost revenue. |
Cost Reduction |
–15% Decrease | AI automates workflows, reduces manual labor in editing, marketing, and customer service, lowering operational costs. |
Key AI Applications |
Content creation, distribution, audience analytics | AI enhances scriptwriting, dubbing, video editing, and optimizes ad placements. |
Industry Beneficiaries |
Streaming platforms, film studios, news agencies, gaming | AI helps in content recommendations, automated news writing, and game design. |
Challenges & Risks |
Job displacement, deepfake risks, regulatory concerns | While AI streamlines operations, concerns over ethical AI usage and job losses remain. |
India’s Strategic Position in the Global AI-M&E Value Chain
The report places a spotlight on India’s unique strengths in this AI-driven transformation. Known for its robust content production capabilities and deep IT talent pool, India is positioned as a strategic node in the global AI-M&E value chain. “The convergence of its deep talent pool, rapidly maturing AI ecosystem, and proven capabilities in media production positions India as a strategic node in the global AI-M&E value chain” EY stated.
India’s cost advantage in animation and VFX services-estimated at 40% to 60%-is supported by a large, skilled workforce. This, combined with the increasing international appeal of Indian storytelling, is turning the country into not just a content-consuming nation but a “studio to the world.” Notably, up to 25% of views on Indian OTT content now originate from overseas audiences.
How Does AI Boost Media and Entertainment Revenues by 10%?
AI’s impact is already visible across several fronts:
- Content Creation and Localization: Generative AI tools are being used for scriptwriting, automated dubbing, subtitling, and voice cloning, enabling faster and more accurate localization for global markets.
- Audience Engagement: AI-driven analytics help companies understand viewer preferences, enabling them to tailor content and marketing strategies for maximum engagement.
- Advertising and Monetization: AI enables real-time, dynamic ad insertions and optimizes pricing strategies, making advertising more effective and personalized.
- Predictive Analytics: Platforms are using AI to model trailer effectiveness, anticipate viewer drop-off rates, and optimize campaign performance.
Industry Voices and Government Support
Union Minister of State for Information & Broadcasting, Dr. L Murugan, who presented the report at the WAVES Summit, emphasized that AI is expected to add significant value to the sector’s growth story. “The global media and entertainment industry is undergoing a dramatic transformation, driven by the proliferation of AI. From content creation and curation to monetisation and distribution, AI is becoming an integral part of how stories are told and consumed,” the report states.
The Road Ahead
With AI adoption accelerating, media and entertainment companies are expected to see not only financial gains but also enhanced creative output and operational efficiency. The EY report underscores that the industry’s future will be defined by those who can effectively integrate AI into their business models-unlocking new revenue streams, reducing costs, and delivering compelling content to increasingly global audiences.
As the sector continues to evolve, India’s blend of technological prowess, creative talent, and cost efficiency positions it at the forefront of this AI-powered transformation, setting the stage for the country to emerge as a global creative powerhouse.
Key Takeaways:
- AI could increase M&E sector revenues by 10% and cut costs by 15% in the medium term.
- India is uniquely positioned to lead the global AI-driven media revolution, thanks to its talent pool and established media production capabilities.
- AI is transforming content creation, audience engagement, advertising, and localization, driving both efficiency and innovation across the industry.
As AI continues to reshape the industry, companies that embrace these technologies are likely to emerge as leaders in the new era of media and entertainment.
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