Something that was believed to be a nonsensical argument a few years ago is now mainstream.

Hollywood is dying.

To anyone paying attention, this is not news. Many metrics are supporting this fact.

Shooting days in Los Angeles are down, along with jobs. Volume, ie tickets sold, at movie theaters is half what it was. Employment in the industry is falling.

Across the board, the numbers are bad.

So what is the lesson here? I will dive into this.

The Lesson of Hollywood's Demise

To dig into this, we have to look at the cause of the demise. Here is where things get a bit tricky.

Scroll through YouTube and you will find many videos explaining what was the cause. To me, this focuses upon the fringe while missing the entire elephant in the room.

While the poor scripts, union strikes, tax incentives, escalating prices, and COVID had a hand in it, they were auxiliary causes. To focus upon them misses the entire basis of what took place.

Hollywood's destruction is due to technology. I stated this in the past. There were two waves of technological advancement. Unfortunately, for the industry, we are only seeing the impact from the first. Over the next couple years, as the second wave takes hold, the end will be achieved.

To explain, we will start with the latter wave.

Here we are looking at AI. This is just getting started. It is something that is of great concern by many in the industry. As a side note, employees in many industries will face the same dilemma.

The catalyst to what we are seeing in Hollywood started with the Internet. That was the disruptor.

When that became commonplace, the monopoly on distribution by the Hollywood gatekeepers instantly broke down. The transition took decades to complete but the billions of hours people spend on YouTube and TikTok is time spent away from Hollywood productions.

Here is the latest version of The Gauge:

YouTube is the dominant streamer. We have to keep in mind, this is only what is viewed on television. It does not include all those hours spent watching videos on a laptop or mobile device.

The early days of YouTube videos were little more than cat pics. Things have changed greatly. The improvement in capabilities along with the acceptance of social videos (i.e. good enough) has turned this into a boom.

The Lesson For All

If you ask most CEOs what business their companies are in, you will get a specific answer. Reponses such as automotive, communications, entertainment, or retail will get mentioned.

Ask that same question to a tech CEO and the answer is "anyone we want".

Think about that for a second.

The barriers for technology companies are much less than the average business. Home Depot is not about to start selling automobiles. However, Elon Musk, part of the original PayPal mafia, is taking Tesla into the AI world.

For years, people argued what Tesla was. The bears said it was simply a car company. Fans, on the other hand, mentioned energy, technology, AI, and, recently, robotics.

It was the same problem people had with Google over the decades. What do they do exactly?

In fact, when we look at autonomous vehicles, the two leading players (in the US) are Google and Tesla. Traditional automotive is nowhere to be found.

AI and robotics are only going to accelerate this. Hollywood lessons should be learned. While the industry focused upon the status quo, launching the same arguments that were occurring for decades, a tsunami was taking hold.

AI will finish Hollywood off.

This is only the start. We will see a number of other industries completely upended.

The automotive industry is going to feel it in a major way. We will shift from automotive to transportation. This is where the robotaxi industry is going to affect things. Naturally, the conversion will not be 100%. That said, many are going to start altering their behavior as the technology becomes commonplace.

Another industry just primed for disruption is finance. Actually, this saw a major transition over the last 25 years. FinTech is part of the vocabulary today as traditional institutions have battled successful startups. This decade-long fight is not going to stop.

Anything on a screen, especially if it is based on numbers is primed for AI. This is where computers excel. We already see that.

Here is an industry where incumbents are unsure where the next "killer" will come from. It could emerge tomorrow.

Hollywood was caught off guard. Other industries should not make the same mistake.

The lessons are there for all to see.