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Date:
December 21, 2022

Spherex M&E Predictions for 2023

Legendary novelist and screenwriter William Goldman famously said , "In Hollywood, nobody knows anything." He was right in referencing Media and Entertainment's ability to predict what will happen. With that, we offer our predictions of the events that may impact M&E in 2023.

1. The Shift from Linear to Streaming Is Terminal

Just as " Video Killed the Radio Star ," consumer preference and their adoption of any number of the alphabet soup of VODs signals that linear television's demise is upon us. Industry leaders agree. Disney's Bob Iger said linear "is heading for the great precipice," and industry analyst MoffettNathanson, LLC has stated linear TV is " hanging by a thread ."

This past year, cord-cutting continued to devastate linear TV. The percentage of households watching pay TV declined from a high of 85% in 2007 to 55% today . In Q3 of 2022 alone, pay TV slipped 6.2%, and satellite services fell 12.9% YoY, with a combined total loss of 1.68M subscribers. At the same time, virtual TV providers (vMVPDs), such as Sling TV, Hulu+Live, and YouTube, added 898K subscribers (14.6%). For the first time, streaming overtook linear in August, reaching a 34.8% share compared to 21.6% for broadcast and 34.4% for cable.

Hidden within those numbers are the changes in age preferences and indicators of the long-term viability of linear TV. For example, in the UK, people aged 16-24 years watch seven times less broadcast TV than their over-65 counterparts. In the US, four-in-ten teens reveal that their household doesn't have a pay TV subscription.

Advertisers are noticing these changes, too, and those changes are impacting their spending decisions. Local TV advertising is forecast to decline by 15% in 2023, and a third of its advertisers " will not resume linear TV spending anytime soon ." These changes present real challenges for networks looking to keep audience numbers while maintaining revenue and deciding what content in which to invest.

A recent story in the New York Times describes AMC's challenges as it tries to generate enough profit from streaming to make up for its traditional linear business, and this problem is not unique to the industry. Industry-wide, layoffs, restructuring, and changes in content priorities away from linear TV in favor of streaming are commonplace across the industry.

Paraphrasing, "2023 may not be the end of the (linear TV) Earth, but you can see it from here."

2. Generative AI Makes Itself Known

If you don't know what Generative Artificial Intelligence (AI) is, you will find out in 2023.

Generative AI tools generate new content, e.g., images, audio, text, or computer code, through an unsupervised and autonomous process of data collection gained from direct user interaction. It learns about the user and the task and improves on the fly.

Compare this to Discriminative AI, which requires teaching the task using static data. While Imagen , ChatGPT , and Latitude are all Generative AI tools with direct M&E applications, Spherexgreenlight™ is an example of Discriminative AI.

For example, using Imagen , a photographer can edit individual or batches of photographs to match a specific style. Suppose they're editing photos for a sci-fi movie, and all the images are required to look like they were shot on Mars. After defining the appropriate lighting in Adobe Lightroom Classic, Imagen automatically changes an entire catalog of shots " at less than ¬Ω second per photo ."

ChatGPT is a "research preview app" intended to "converse" with people and generate automated responses. The app can answer questions, have a conversation, make decisions, or write the following sentence for this post. To demonstrate its capabilities, we asked it to "describe its expected benefits to the film and TV industry."

"ChatGPT's expected benefits to film and TV content creators, directors, and distributors include increased efficiency and productivity through the use of AI-powered tools for scriptwriting, casting, and scheduling."

Latitude is a platform for creating new user experiences in online gaming. It removes the constraints programmed into traditional games by allowing users to create their own stories within the game universe and let them play those stories out. Its first released product, AI Dungeon , is a game influenced by the classic Dungeons & Dragons game and answers the question of whether AI can be a Dungeon Master . Players can add to the story by describing what they want in simple terms, and the platform generates it in real-time and inserts the objects or actions into the game.

These are just a few companies creating Generative AI products for M&E. We believe 2023 will be the year people begin to fully recognize the value they add to content creation, production, and distribution.

3. Foreign Language Content Becomes an Industry Staple

As consumers make streaming their entertainment delivery platform of choice, content quality and diversity will be recognized as critical factors when selecting their platform. Increasingly, the content created by women and people of color includes characters in non-traditional roles or relationships and originates outside Hollywood.

Foreign language content is breaking geographic and language barriers everywhere. Many of the top series across the major streaming platforms in 2022 were foreign titles. Extraordinary Attorney Woo (South Korea), Little Women (South Korea), Suzhal: The Vortex (India), and Slow Horses (UK) are a few examples. The Academy of Motion Picture Arts and Sciences announced 75 films from 92 countries were eligible to receive the Best International Film Oscar at the 95 th Awards ceremony in March, an increase of 13 films from 2022. These films are also acceptable for the coveted "Best Picture" Oscar.

With the increased awareness of quality storytelling worldwide and consumers' willingness to " overcome the 1-inch tall barrier of subtitles ," audiences are being "introduced to many more amazing films." Success breeds success. Foreign language titles attract significant audiences, and revenue means studios and producers will invest the necessary resources to localize their titles and distribute them internationally properly. As a result, not only will consumers have access to many more amazing stories, but localization will become an integral and necessary component of post-production in 2023 and beyond.

That's a Wrap!

This coming year will continue to be one of innovation and change. Come back in December 2023, and let's see how well we did!

Related Insights

NAB 2025 – Recognizing a Changed Industry

Another National Association of Broadcasters (NAB) conference is in the books, and if anything has changed in the media and entertainment industry, the conference and attendees were there to discuss it. From content evolution to changes in audience preferences to AI being everywhere, to trade uncertainty, it was a topic of conversation at NAB 2025. Official categories included: Artificial Intelligence, Cloud Virtualization, Creator Economy, Sports, and Streaming. If a general conclusion could be drawn, it’s that the legacy media business no longer cuts in today’s market, and to survive these new realities, businesses must rethink how they fit in.

Everything Is Changing

One of the biggest takeaways from NAB is the impact the creator economy is having on the industry. Dozens of panels focused on how individuals and small-team productions have upended traditional business models and economics, attracting large audiences from traditional producers while also siphoning away ad revenues and production contracts. Recognizing this trend, hundreds of exhibitors demonstrated how their products or services support all types of creators while also providing benefits to traditional media companies. The NAB also introduced two new initiatives to support this growing sector: the Creator Council and the Creator Lab.

In a keynote session, media cartographer Evan Shapiro highlighted the extent of the shift, pointing out that by 2027, the creator economy is expected to grow to half a trillion dollars, nearly doubling its value from last year ($250 million). Shapiro, recognizing the difference between the creator economy and influencers, cites their effectiveness in attracting and engaging large audiences without having to deal with “gatekeeper-led content.” His final point was that this new reality presents the M&E industry with two options: embrace it or get left behind.

Market and Regulatory Uncertainty

The current uncertainty in global trade markets and the impact of tariffs on product purchases has cast a significant chill on many exhibitors at NAB. This was especially true for those companies whose products were manufactured or included parts from impacted countries or markets (services are not yet subject to tariffs). Many companies encouraged customers to expedite purchases to take advantage of existing inventories and avoid significant cost increases as tariffs are implemented. Attendees and speakers also expressed concerns about how regulatory changes from the FCC and regulators in other countries might impact  children's television programming, the news distortion policy, technical rules (e.g., ATSC 3.0), and TV carriage rules (e.g., non-duplication, and syndicated exclusivity).

Monetization Evolves as Markets Evolve

The continued growth of OTT/FAST and the rapidly expanding creator economy means competition for eyeballs and ads will only become more intense. Evidence of this was on clear display during NAB 2025:

  • Traditional Broadcast Disruption: The rise of streaming services and changing viewer habits are challenging traditional broadcast models, necessitating a reimagining of revenue strategies.
  • Fragmented Audiences: The audience is increasingly fragmented across linear streaming, on-demand platforms, and traditional broadcast, making it more difficult for advertisers to reach consumers effectively.
  • Hybrid Models: Streaming services are increasingly adopting hybrid monetization models, such as AVOD or FAST, to supplement their subscription revenues.

A key component of all of these strategies is high-fidelity metadata. Without it, content marketing, search, and discovery, as well as contextual advertising, are much more difficult to achieve. With it, compliance, brand safety, and audience acceptance increase significantly.

AI Everywhere

Artificial Intelligence (AI) and its increasing impact on content creation, marketing, and virtual production were everywhere at NAB 2025. Nearly 300 exhibiting companies from around the world demonstrated products that included or were enhanced by AI across every phase of content production, marketing, advertising, and distribution. Among them, Spherex highlighted its flagship product, SpherexAI, and demonstrated how it is transforming global video compliance and contextual advertising through scene-level intelligence and cultural insight. It also facilitates ad placement where they will resonate and yield better audience results.

The takeaways from NAB 2025 paint a clear picture: the media and entertainment landscape is in constant flux, demanding adaptability and innovation for survival. The undeniable surge of the creator economy, coupled with market and regulatory uncertainties and the evolving monetization models driven by streaming, presents both challenges and opportunities for traditional and new players. Overlaying all of this is the pervasive influence of artificial intelligence, poised to reshape every facet of the industry.

Ultimately, NAB 2025 underscored a fundamental truth: standing still is no longer an option. The future of media and entertainment belongs to those who embrace change, leverage new technologies, and understand the shifting dynamics of both content creation and audience engagement.

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Experience SpherexAI at NAB 2025

Spherex is headed to Las Vegas for NAB 2025, and we’re bringing a bold new expansion of our flagship product, SpherexAI. Join us at Booth W1456 in the West Hall of the Las Vegas Convention Center from April 6-9 to see how we’re transforming contextual advertising with cultural and emotional intelligence.

As the media and advertising industries look to AI for smarter targeting and better brand alignment, SpherexAI offers a groundbreaking solution. By analyzing the cultural and emotional context of streaming video at the scene level, SpherexAI helps advertisers engage audiences more meaningfully while reducing the risk of misaligned or unsafe ad placements.

The Power of Scene-Level Intelligence

At the heart of our advertising innovation is SpherexAI’s multimodal platform, which processes thousands of signals from every frame—visuals, audio, dialogue, and on-screen text—to create rich metadata that understands the tone, mood, and narrative context of video content.

This deep, scene-level intelligence powers a range of capabilities that can dramatically improve campaign effectiveness:

  • Smarter Ad Targeting – Ads are delivered when viewers are most emotionally receptive, based on the precise tone and content of each scene.
  • Seamless Integration – Ads align with the story arc instead of disrupting it, increasing both engagement and recall.
  • Cultural Sensitivity at Scale – Our patented Cultural Knowledge Graph ensures ad messaging aligns with local customs, values, and regulations in over 200 countries and territories.
  • Enhanced Brand Safety – SpherexAI actively prevents ad placements in scenes that could be offensive, inappropriate, or reputationally risky.

Whether you're building a global campaign or fine-tuning messaging for a specific region, SpherexAI ensures your ads resonate with cultural nuance and emotional precision. Best of all, this isn’t vaporware; SpherexAI can be added to your workflows today!

See It In Action

At NAB 2025, we’ll be demoing how SpherexAI empowers advertisers to connect with audiences in powerful new ways—by aligning their campaigns with the content people are already emotionally invested in.

Book a Demo

Ready to experience the future of contextual advertising? Book a meeting with the Spherex team or drop by Booth W1456 during NAB 2025. We’re excited to show you how scene-level cultural intelligence can elevate your strategy and unlock deeper audience engagement.

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Teresa Phillips Joins OTT.X Buzz Panel to Celebrate Women’s History Month

On March 19, 2025, Spherex CEO Teresa Phillips joined a distinguished panel of female executives for the OTT.X BUZZ session—Women’s History Month Edition. This engaging discussion covered the latest trends in OTT and digital video while shedding light on women's unique experiences navigating the media and technology industries.

Moderated by Charlene Polite Corley, VP of Diverse Insights & Partnerships at Nielsen, the panel featured:

  • Teresa Phillips, Chief Executive Officer, Spherex
  • Jenn Chen, Chief Revenue Officer, JWP Connatix
  • Maria Hellström, Chief Executive Officer, Codemill
  • Laura Martin, Managing Director, Senior Internet & Media Analyst, Needham & Company
  • Paige Sherman, Director, Digital Video Programming, Shout! Studios

Teresa shared valuable insights on leadership, career development, and the evolving role of women in media. Reflecting on her journey in a male-dominated industry and the U.S. Army, she emphasized the impact of mentorship and sponsorship in shaping successful careers. Offering practical advice for early and mid-career professionals, Phillips highlighted the importance of adaptability, recognizing career pivot points, and leading through times of transition.

Key Takeaways from the Discussion Throughout the session, the panelists tackled some of the most pertinent topics facing women and the industry today, including:

  • Work-Life Balance and Corporate Support: The panel explored how companies can better support caregivers, highlighting policies that enable a more inclusive and sustainable work environment.
  • The Rapid Evolution of AI in Media: With AI and automation playing an increasingly central role in content distribution, Phillips emphasized Spherex’s role in leveraging AI-powered tools to help studios navigate cultural and regulatory landscapes worldwide.
  • Leadership in a Shifting Industry: The panelists reflected on how they’ve adapted to significant industry changes, from the rise of FAST channels to the increasing role of data-driven decision-making in content strategy.
  • Challenges and Opportunities for Women in Media: The discussion tackled informal workplace dynamics that impact women’s success, from navigating corporate culture to advocating for fair representation at leadership levels.
  • Balancing Authenticity and Career Growth: Panelists shared insights on maintaining personal authenticity while adapting to workplace expectations in male-dominated spaces.

Looking Ahead: Women Driving Industry Innovation -The panelists reinforced that women’s leadership in M&E is not just necessary—it’s a competitive advantage. As AI, automation, and viewer behaviors evolve, diverse leadership will play a pivotal role in shaping the future of streaming.

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