Fast-changing AI landscape has Hollywood scrambling to keep up

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Why it matters: In just the last two weeks, the first public partnership between a studio (Lionsgate) and a generative AI video company (Runway) was announced, and Gov. Gavin Newsom signed and vetoed a slew of AI bills. The speed of these developments — and that of the technology itself — has made how to handle AI an urgent dilemma for Hollywood’s dealmakers.

The “natural” hierarchy: The AI companies are at the top of the food chain, armed with the technology and billions in capital. Next come the studios, which possess the content that the AI companies want to make their AI models better. They’re seeking to use AI for cost-cutting, which many fear will lead to job losses as AI usurps roles presently done by people. Talent, alas, has the least amount of leverage against big tech and the studios when it comes to AI. Studios, for example, are requiring actors to sign an agreement allowing them to make a digital replica of the performer. If they don’t sign, actors will lose the part.

Newsom’s big bills: Technology is a bigger economy than Hollywood, which explains in part Newsom’s decision to veto the bill that would have required more AI guardrails to protect against such “critical harms” as cyber attacks and mass casualties, among other things. Although many celebrities as well as SAG-AFTRA endorsed the sweeping AI bill, the major tech companies pursuing AI opposed it.

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