Six Forces Reshaping Hollywood: What 2026-2030 Looks Like

It's 2026, and the production landscape is shifting faster than most predicted. AI is embedded across workflows, capital has moved decisively toward streaming, tax incentives continue to pull work across borders, and creators are building what increasingly look like studios. Meanwhile, every player in the ecosystem is competing for the same finite resource: audience attention.

It's tempting to treat the current moment as a temporary hangover, a few weird years of strikes, resets, and overcorrection. But the bigger story is structural: the economics of making and monetizing video content are shifting under our feet, and the production ecosystem is being forced to adapt faster than any prior cycle.

At Sohonet, we've spent the past year tracking these shifts through our Screen Production Index and conversations with studio leaders, post and VFX houses, and platform executives across the industry. What emerged is a framework we're calling the Six Market Forces, interconnected trends that will define how content gets made, where it gets made, and who makes it through the end of the decade.

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The Six Forces

1. Generative-AI Cost Compression AI is compressing the unit cost per shot. Roto, layout, assembly edits, and iteration cycles are getting faster with smaller teams. Unlike previous tech cycles where efficiency gains were absorbed by scope creep, this shift is allowing creators to stretch budgets further—particularly in the small and mid-budget tiers where margins matter most. The knock-on effect: more titles, more iterations, and more operational complexity.

2. Linear-TV Cashflow Decline Linear TV isn't disappearing overnight, but its economics are weakening fast. US pay-TV lost 6 million subscribers in 2024. Ad CPMs on linear dropped 8% year-over-year while CTV rose 4%. The capital isn't vanishing, it's being redeployed into streaming originals and DTC platforms, which keeps overall production volume growing even as traditional broadcast contracts.

3. Keeping Up with Netflix (and YouTube) Netflix's $18 billion content budget for 2025 sets the pace. Rivals must maintain volume to defend against churn. But the competitive frame has expanded: streamers now compete not just with each other but with YouTube, which dominates living-room viewing for the 18-40 demographic. This pushes everyone toward more output, more formats, and faster delivery.

4. Hybrid-Cloud Economics The HPA's 2024 survey found 78% of productions now run hybrid workflows, on-prem infrastructure with cloud burst for scale, AI processing, and remote collaboration. Pure cloud remains too expensive (GPU spot prices up 17% YoY); pure on-prem can't scale. The result is more data-gravity points per project and growing demand for workflow integration across physical and cloud infrastructure.

5. Tax-Incentive Migration Global incentives continue to expand the production map. Ireland's effective rate hits 32-40% through 2028. The UK's AVEC locks in 34-39% through 2031. Germany consolidated at 30% with doubled funding. In 2024, 68% of Netflix EMEA originals shot outside traditional hubs. Productions are more geographically distributed than ever, which means more intercontinental data movement and more coordination complexity.

6. Creator-Economy Aggregation YouTube has become the broadcast layer for younger demographics. Agency-backed creator networks and AI content studios are aggregating talent and distribution to compete with traditional studios for attention. The trend is professionalisation: micro-studios bundling into creator hubs, moving from bedrooms into professional production infrastructure.

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What It Means

These forces don't operate in isolation. They compound.

AI cost compression plus streamer volume pressure plus linear decline equals more titles in the small and medium budget tiers, potentially 880 additional pro-grade titles by 2030, concentrated in the $1-35M range.

Tax incentives plus hybrid-cloud economics equals more bits travelling farther, between sets, regional post hubs, cloud buckets, and finishing houses. The median project now touches 7-8 data nodes, up from 3 just a few years ago.

Creator aggregation plus AI tooling equals new studio-like ecosystems emerging outside Hollywood's traditional structure, driving growth in tier-2 and tier-3 production hubs.

The macro overlay: all three chains compress timelines and shift production from centralised to distributed. Winners are those who build operational flexibility into their workflows -not those who rely on scale or fixed infrastructure alone.

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The Road to 2030

The result we see building toward 2030 is clear:

• Higher output, especially in Small and Medium budget tiers
• Workflows distributed across more locations and vendors
• More shots and more review cycles per title
• More deliverable versions, more metadata, and more operational complexity

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Every part of the ecosystem -studios, production companies, post houses, VFX vendors, localisation vendors, infrastructure providers - will need to evolve with these demands to ensure their contribution remains relevant and commercially viable as this new era takes shape.

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Download the Deck

If you want the full visual breakdown, data points, logic chain, and implications, you can download "6 Forces Reshaping Hollywood 2026-2030."

And if you disagree with any of the assumptions, good. The point of thought leadership is to sharpen the industry's thinking. Send your counter-data, and we'll incorporate it into the next revision.

Download: 6 Forces Reshaping Hollywood 2026-2030