On today's podcast episode, we discuss the speed of AI adoption, what to make of ChatGPT's engagement lull, and how Nvidia is shaping AI's future. "In Other News," we talk about how Roblox's AI assistant could transform gaming and how Amazon is using its neural network to improve the NFL's game-watching experience. Tune in to the discussion with our analysts Jacob Bourne and Gadjo Sevilla.

Why it matters: The news publishing industry has shrunk dramatically over the last decade thanks to dwindling ad revenues ceded over to the Google and Meta duopoly. That decline has thrown it into conflict with tech companies, but the fact that no new widely applicable revenue model has emerged remains.

Disney and Charter’s carriage fee clash is a landmark moment: A new deal includes Disney+ and ESPN subscriptions for the linear TV service’s customers.

The entertainment industry has emerged from the pandemic-era doldrums and is back to being an enthusiastic digital advertiser. Before the onset of the pandemic in 2020—which closed movie theaters, amusement parks, sports arenas, and every other public venue—the entertainment industry had consistently grown its digital ad spending faster than the national average on a yearly basis.

For as long as they’ve existed, the media and entertainment industries have been about telling stories through a growing number of mediums. However, no matter the focus—news, sports, fashion, health, music, or film—the stories rely heavily on visuals to convey nuances. Today, visual experiences are driving the economy.

In both studies, media and entertainment outpaced categories such as automotive, retail, and finance, which account for a much larger share of total digital ad spending. In our own estimates, media and entertainment combined account for about one-tenth of all digital ad spending. Meanwhile, retail accounts for one-fourth of all digital ad spending.

This current wave of mobile innovation is empowering media publishers and the entertainment industry to provide a new and unprecedented level of intuitive functionality as well as customizable and frictionless experiences that look like TV but act like mobile. The surfaces economy is the future.

The context: According to Aaron LaBerge, CTO of Disney Media & Entertainment Distribution, Disney's ad server—“the heart of our platform,” in his words—already powers all of Hulu's and Disney+'s US-based addressable ad systems at 100%, and over the course of the next 12 months, it will power all of Disney's addressable platforms.

The deal values the combined company at $21 billion and is a major step toward greater consolidation in the entertainment industry. WWE and UFC viewership: Combat sports and professional wrestling are often siloed into their own, separate category when talking about sports viewership, but they’re powerful forces with huge, growing audiences.

National Cinema Day draws 8.5 million attendees: Younger demographics show renewed interest in in-theater experiences.

It’s no secret that the digital publishing industry has been in decline for nearly a decade and isn’t going to get better anytime soon, what with the end of third-party cookies on Chrome looming in the distance. Media executives believe that AI can help do both. BridgeTower also emphasized AI’s ability to improve search engine optimization and produce higher quality in quicker time.

Key quote: Google chief business officer Philipp Schindler said in the earnings call that “retail was again, by far, the largest contributor” to ad growth, followed by finance, media and entertainment, and travel. Why it matters: With the massive boom in online shopping over the pandemic, the retail industry’s importance in the digital ad market has rapidly increased.

Report: Media and Entertainment Ad Spending 2022. Article: ‘Disney Prime’ could be on the way as the entertainment giant pursues a membership offering. Article: Is the value of a Netflix subscription diminishing?

Amazon and Disney could team up on ESPN: Thursday Night Football could make Amazon a desirable partner for ESPN’s uncertain streaming future.

More than half of global agency respondents to a July 2022 World Federation of Advertisers and MediaSense survey believe the media industry is in its worst-ever talent crisis.

The news: The Media Rating Council, which upholds standards for measurement companies on behalf of the media industry, said on Monday that Nielsen has regained its approval after addressing a number of concerns.

Publishers swoop in: The redistributing of ad dollars across different formats is aiding the embattled publishing industry—or at least benefiting those at the top. Those with the most leverage are so-called “premium publishers” with guaranteed large audiences and reach.

The news: As Hispanics become an important driver of US population and spending growth, recent reports show the community remains underrepresented in significant aspects of American life such as media and entertainment.

“[Marketers] want to get to this nirvana of real-time personalization,” said Steve Sobel, global industry leader, media and entertainment at Databricks, during our recent webinar. “But, if you don’t have the support from data engineering and data science … getting to real-time personalization is going to be an impossibility.”.

Yet with the increasing number of exclusivity deals that are seeing major sports leagues, popular intellectual properties, and blockbuster films get locked behind closed doors, caving in and subscribing to yet another service can feel like an inevitability for consumers—especially as streaming services increasingly become the dominant players in the entertainment industry.

That the JIC exists at all shows the media industry attempting to provide a bridge to advertisers, but it will struggle to create standards that keep everyone satisfied. Want to know more about what's going on with TV currencies? Keep an eye out for our upcoming report from senior analyst Evelyn Mitchell, Ad Measurement H1 2023, due out in April.

Publishing feels the ad downturn: The already embattled publishing industry has been hit hard by the ad downturn, and the Post news is the latest in a long string of layoffs and closures. Earlier this summer, Recurrent Ventures shut down Mel Magazine and laid off its staff of around 15 employees just one year after acquiring it.

But others, like Andre Swanston, senior vice president of media and entertainment at TransUnion, say, “All signs point to the IP address sticking around for the time being.”. A word of warning: If IP addresses are the next to go, it will be a reckoning for the connected TV (CTV) ecosystem. “IP addresses are to CTV as third-party cookies were to web browsers,” said Verna. Watch the full webinar.

Report: Media and Entertainment Ad Spending 2022. Article: Portable consoles, streaming services are biggest opportunities in video games. Webinar: How to build a future-proof modern marketing stack. Read yesterday’s Chart of the Day here.

Article: Media and entertainment on opposing sides of search ad dollar spend growth. Read yesterday’s Chart of the Day here. Methodology: Data is from an August 2022 Perforce report titled "Game Development Trends & Forecast." 313 professionals from the video game development industry worldwide were surveyed during January-May 2022.