Executive Briefing: Tuesday 6 October

Executive Summary The media landscape is undergoing a significant shake-up with the formation of a new entertainment giant. Marketers face evolving challenges in content creation, with in-house production teams needing to address critical skill gaps as their scope expands. Furthermore, artificial intelligence is reshaping search discoverability and brand mentions, demanding new optimisation strategies, while digital twins present an underutilised tool for corporate crisis readiness. New Entertainment Giant Formed by Media Consolidation The merger of Paramount and Warner Bros. Discovery under Skydance is set to create a media conglomerate rivalling Disney and Netflix in scale. David Ellison will lead as Chairman and CEO, with Ynon Kreiz as Co-CEO, overseeing a vast empire that includes Paramount+, Pluto, and HBO Max under Casey Bloys, and film studios run by Josh Greenstein and Dana Goldberg. This consolidation significantly alters the competitive landscape for content creation, distribution, and advertising, presenting new dynamics for brands seeking partnerships or navigating audience reach across major platforms. Skydance has announced the senior executives who will run the combined entity. In-House Production Confronts Specialised Skill Gaps While in-housing is now a permanent fixture in Australian advertising, with 86% of brands valuing it equally or better than agency rates, internal teams often lack the specialised production skills needed for ambitious campaigns. Marketers and project managers are increasingly taking on complex responsibilities like talent contracts, insurance, and post-production, which traditionally fall to experienced producers. This capability gap creates significant risk when high-volume social or quick-turnaround work evolves into multi-market rollouts or paid campaigns, highlighting a need for investment in professional production expertise within in-house models. AI Reshaping Search Discoverability and Brand Mentions Google is intensifying spam updates, leveraging AI to combat the "growing flood of AI slop" and low-effort content, which now poses a greater problem than link spam. Simultaneously, a new discipline of Generative Engine Optimisation (GEO) is emerging to track brand visibility within AI answers, as buyers increasingly compare vendors directly within these responses. Platforms like Omnia are designed to record brand mentions, cited sources, and competitor framing within AI answers, revealing a critical gap where traditional SEO focuses on clicks, but not on recommendations that bypass website visits. Google AI Mode, for instance, cites an average of 13.8 domains per answer, while AI Overviews cites 9.2 domains. Digital Twins Underutilised for Proactive Crisis Readiness Despite 70% of C-suite technology executives at large enterprises exploring and investing in digital twins for operations and supply chain optimisation, few are applying this technology to rehearse crisis scenarios. Recent incidents, such as a software update crash affecting 8.5 million Windows devices and a ransomware attack exposing personal health data of up to 1 in 3 Americans, have incurred documented losses exceeding $7 billion in the first half of 2024 alone. This highlights a significant strategic gap in leveraging digital twins for proactive crisis management, a capability that could mitigate billions in potential damages.