Lionsgate Vice Chairman Michael Burns said AI could save the company “tens of millions of dollars a year” not only in film and TV production, but also in areas such as FAST channel curation.
In addition to the cost efficiencies that studios and creators alike have been touting recently, Burns also included AI companies as “wild card” candidates to someday acquire Lionsgate, which has long been considered a ripe acquisition target.
“This is like Moore’s Law of rifts,” Burns said Thursday at the Gabelli Sports & Media Symposium in New York, alluding to the tech industry adage that regularly increasing computer processing power fosters innovation. “It’s happening very quickly. If you own existing IP, you have different ways to monetize it. So I think it’s exciting.”
Burns recalled that at a recent conference, his colleagues showed him “all the things we do in the AI world: movies, specific shots, movie previews, how to budget, and so on.” AI “could save tens of millions of dollars a year,” he added. For context, Lionsgate’s film and television studio business generated more than $3 billion in revenue in its most recent fiscal year, according to SEC filings.
Although most media and streaming companies tout the efficiency of AI, the topic remains a sensitive one given the sensitivity of the creative community about the future of copyrighted works. The Writers Guild and SAG-AFTRA have been successful in recent months in renewing the contract with AMPTP, averting a repeat strike in 2023 that was fueled in part by concerns about AI. However, there are still major concerns about artist protection and guardrails.
Executives leading media and streaming companies whose AI strategies are questioned are typically at pains to emphasize the need to involve human creators and develop “responsible” protocols. They also generally refrain from venturing into financial numbers for potential savings, emphasizing the innovation aspect of adopting new technology.
Asked by the moderator about the legal risks associated with codifying AI, Burns said he expected a set of actionable protections to be established soon through a collaborative process among stakeholders. “I think actor likenesses, if they collaborate, they’ll be on board. … Everyone can monetize together.” (Hasbro this week announced the launch of an AI studio designed to allow third parties to use the company’s assets, like Transformers, for a fee.)
Lionsgate has an extensive library of movies and television episodes, and has been looking for ways to monetize those titles for years. According to Burns, AI speeds up the process of curating FAST channels, AVOD services, and other services.
The AI topic ties into a long-standing area of speculation surrounding Lionsgate: its suitability as an acquisition target. While the studio looks attractive, especially since its split from Starz last year, industry and Wall Street experts observe that since Burns and CEO John Feltheimer took the reins of the company in 2000, it has grown by being a smart buyer rather than a seller.
Burns said that while today’s M&A market is ripe for deals, there are some challenges for partners to make the math work.
“Everyone has the same problem: they want to show growth, but there are only two ways to show growth: organically, which is very difficult, and the other way is inorganically, by doing deals,” he said. “I think we are an interesting strategic partner.”
As for who that strategic partner could be, Burns didn’t rule out a private equity firm, but said fellow media outlets would also be candidates. He also categorized sovereign wealth funds and AI companies as “wild cards” in the mix.
“Some of these AI companies have incredible valuations and incredible growth rates,” he said. One such company is Runway, which first partnered with Lionsgate in 2024 and raised funding at a $5.3 billion valuation earlier this year. “I made a joke [CEO Cristóbal Valenzuela] The first time I did business with him, I said, “You know what? “Maybe someday I’ll buy you.” Now he’s probably smiling at me and saying, “Well, let’s see what our ratings are.” ”
