Tokenization and AI: Hollywood and streaming consolidation

The worldwide tokenization market measurement reached roughly $1.24 trillion in 2025, a major improve from $865.54 billion in 2024, with projections for multi-trillion-dollar development by the top of the last decade. This development was primarily pushed by regulatory readability in key jurisdictions. That is Half Three, which evaluates key tokenization and AI know-how developments in Hollywood throughout 2025. Half One: 2025 was the yr of tokenization. Half Two focuses on vitality necessities to help the expansion in AI-driven tokenization, necessitating orbital cloud information facilities. Half 4 of a four-part collection the place I consider how tokenized edge cloud streaming and AI are reworking sports activities and prediction markets betting, which is a quickly growing immersive expertise.

Tokenized edge cloud streaming and AI are reworking Hollywood

The U.S. media and leisure trade is the world’s largest. Main Hollywood studios have traditionally held a first-mover benefit in industrializing and distributing movies and TV applications with broad worldwide enchantment. Within the U.S. and international markets, the key movie studios, typically referred to as the Huge 5 studios — Common Photos (Comcast Guardian), Paramount Photos, Warner Bros., Walt Disney Studios, and Sony Photos — have been generally considered the 5 diversified media conglomerates whose numerous movie and TV manufacturing and distribution subsidiaries collectively command roughly 80 to 85% of the U.S. field workplace income. 

In 2025, Hollywood skilled a major energy shift pushed by main consolidation within the leisure and media trade, highlighted by a bidding struggle for the Huge 5 Studio Warner Bros. Discovery by one of many largest streaming firms. Netflix has reached a definitive settlement to accumulate Warner Bros. Discovery in a deal introduced on December 5, 2025, for roughly $82.7 billion, which is at present pending regulatory and shareholder approval, a hostile counterbid of $108 billion from one other Huge 5 Studio, Paramount, together with Jared Kushner’s personal fairness agency, Affinity Companions. And a category motion lawsuit^.

Actor Matt Damon has stated that streaming negatively impacts cinema, primarily by eliminating the backend income (residuals) that used to return from house video gross sales (DVDs, and so on.). Streaming makes it more durable for mid-budget, non-franchise grownup dramas to be financially viable as a result of streaming viewership doesn’t supply the identical type of revenue participation or bonus buildings as conventional field workplace and residential video gross sales, so artists get much less compensation for profitable tasks. For example, Matt points out his film Air, which was streamed worldwide by Amazon Prime, which barely lined its  $90 million price range on the field workplace.

In latest interval, streaming giants like Netflix, Amazon Prime, Hulu, Apple TV, Warner Bros spent considerably extra on worldwide productions than home ones with France, Italy, Mexico, Columbia, Canada, Japan, UK, Australia, New Zealand, Eire, Hungary, Germany, Spain, Portugal and Czech Republic benefiting from Hollywood’s filming transferring abroad, by means of a mixture of beneficiant monetary incentives, various places, and a strong native movie trade infrastructure. Actor Matt Damon’s lifelong buddy and enterprise accomplice Ben Affleck, who directed and acted within the movie Air, which was filmed extensively within the Los Angeles space, pointed out that California’s lack of tax credit makes it cheaper to fly crews to locations like Eire or Hungary than to movie domestically in CA.

US President Donald Trump, who campaigned utilizing strains from the movie Air, has been involved about Hollywood’s TV and movie manufacturing and distribution, being ‘stolen’ away by different nations.

This prompted him to suggest a 100% tariff on foreign-made movies first throughout Could and once more in September, framing it as a nationwide safety situation to convey movie and TV manufacturing again to the U.S., citing abroad tax incentives luring away U.S. jobs and studios. Trump additionally just lately acknowledged he can be concerned within the regulatory evaluate of potential offers for Warner Bros. Discovery and signaled that the deal might face antitrust scrutiny. 

The shift to streaming know-how developed by US firms like Netflix, Hulu (Walt Disney Guardian), Warner Bros. Discovery (Max), together with main tech firms resembling  Amazon (Prime Video), Apple (Apple TV+), and Google (YouTube), has basically reworked movie and TV distribution by disrupting conventional fashions, altering how content material is consumed. The consolidation of energy amongst a couple of main U.S. media and tech firms has created vital issues relating to management over info, lowered variety of voices, potential for biased content material, and anti-competitive practices. These firms management an unlimited portion of the streaming platforms, AI produced content material, and the underlying edge cloud streaming know-how infrastructure which can be revolutionizing Hollywood by altering content material creation (AI for scripts, visuals), streamlining manufacturing (AI automation, edge cloud), enhancing distribution (sooner supply through edge cloud), personalizing viewers expertise (AI algorithms), and reshaping enterprise fashions (blockchain for royalties, possession, earn-to-watch mannequin), resulting in democratized instruments, new income streams, but in addition profound trade shifts that offers rise to age previous debates over creativity vs. automation and lawsuits of whether AI is infringing on copyrighted TV and movie content.

President Donald Trump signed an govt order that blocks states from imposing their very own rules round synthetic intelligence, aiming to create a “single nationwide framework” for AI.

Edge cloud streaming

The digital revolution, accelerated by the COVID-19 pandemic, has led to a elementary reshaping of Hollywood, characterised by the dominance of streaming-first distribution, data-driven manufacturing, huge funding in unique content material,  supply of on-demand, mobile-centric viewing experiences, and a notable decline in conventional cinema attendance.

Amazon Net Providers, Google Cloud, and Microsoft Azure are extending their sturdy cloud infrastructure to the sting, providing companies like AWS Native Zones, Google Cloud’s Anthos, and Azure IoT Edge. These platforms allow prospects to deploy and handle functions nearer to end-users, leveraging the scalability and options of the central cloud whereas benefiting from lowered latency and localized processing. Edge cloud streaming will be blockchain-based, as these applied sciences complement one another for safe, environment friendly, and peer-to-peer content material supply, creating decentralized content material supply networks or marketplaces.

The shift to edge cloud structure in streaming is enabling sturdy implementation of various monetization methods, together with subscription (SVOD), ad-supported (AVOD), and transactional (TVOD) fashions. By using edge computing, media firms can ship high-quality, low-latency streaming experiences whereas leveraging information processing nearer to the person, which reinforces advert focusing on effectiveness and manages content material supply extra effectively for all income fashions.

You’ll be able to watch a documentary about Melania Trump on Amazon Prime Video, delivered through AWS Cloud’s edge cloud know-how known as Melania, a behind-the-scenes take a look at her life as First Girl-elect.

Do you know that you might earn tokens to look at TV, movie, and promoting content material as an alternative of paying for it? 

Tokenized watch-to-earn streaming

The “watch-to-earn” streaming mannequin in edge cloud streaming leverages blockchain know-how to reward person engagement. Whereas nonetheless an rising and area of interest space, it presents a compelling potential various to conventional subscription or ad-supported monetization fashions by turning viewing time right into a type of cryptocurrency or digital asset that customers can acquire and probably redeem or commerce.

The highest two watch-to-earn platforms include Fundamental Consideration Token (BAT) and the Theta Community, that are two distinct blockchain tasks, every aiming to disrupt internet marketing and video streaming, respectively. The BAT is used throughout the Courageous browser to facilitate digital promoting and content material monetization. Courageous Rewards permits customers to tip creators immediately with BAT on numerous platforms, together with YouTube, Twitch, and Reddit. Theta Community, which streams NASA TV Programming, permits customers to earn TFUEL (Theta Gasoline) by watching movies and sharing sources by contributing bandwidth and computing energy, resembling relaying video streams and operating Edge Nodes, to boost streaming high quality and cut back prices for streaming platforms.

Different watch-to-earn platforms embody Rewarded.television, Verasity (VRA), Edge Video, Script Community, DLive, Vuele, MovieBloc, Flixxo, Odysee (LBC), Permission.io (ASK), PlayNano (XNO), BitTube (TUBE), Cointiply, XCAD Community (XCAD), BitRealms Leisure, Demand Movie, Gaia Movie, Movie.io, Eluvio, Rad, Vabble, Myco.io.

AI connects creators and viewers with streaming

In accordance with a Deloitte report, using AI and machine studying is turning into extra prevalent within the media and leisure trade, notably in content material creation and distribution. The highest two streaming firms, Netflix and Amazon Prime, have already efficiently built-in AI into their streaming companies, with Netflix’s advice engine answerable for about 80% of the content material watched on the platform. The highest third streaming firm, Disney, will make investments $1 billion in OpenAI and let the ChatGPT maker use its characters and properties in a restricted capability as a part of a three-year licensing settlement.

Platforms like Filmhub, Cineverse (previously Cinedigm), use AI to attach creators with streaming platforms and model alternatives, with specialised content material monetization instruments. Cineverse makes use of AI instruments like cineSearch for content material discovery and Matchpoint for automated content material administration, and companions with the Theta Community to leverage its decentralized infrastructure for cost-effective video supply and a token-based incentive system for content material creators and viewers. For instance, it’s potential to earn TFUEL by watching content material on Cinedigm’s CONtv channel, as it’s built-in with the Theta Community.

Taxation within the new tokenized streaming financial system

Tokenized streaming with edge know-how and AI basically reworked international movie and TV distribution by enabling a direct-to-consumer, watch-to-earn mannequin that bypasses conventional intermediaries, fostering new tokenized income streams for viewers, and decreasing entry boundaries for worldwide and impartial creators. This shift is navigating a fancy worldwide tax panorama marked by the rise of Digital Providers Taxes, creating vital uncertainty and compliance challenges for taxpayers.

The U.S. taxation of people concerned in tokenized streaming companies aligns with present IRS guidance on digital belongings and self-employment revenue, requiring all revenue to be reported, whatever the fee technique or whether or not a Type 1099 or 1099-DA is obtained. 

Taxpayers should preserve detailed information of all digital asset transactions, together with dates and truthful market values, and reply the digital asset query on Type 1040 and report all revenue, features, and losses on their tax returns.

Tokens as property: The foundational precept, established in IRS Notice 2014-21, is that digital foreign money is property for federal tax functions. Basic tax ideas for property transactions apply. 

Incomes tokens (Bizarre revenue): Receiving tokens as fee for companies by means of actions like viewing movies, commercials, mining, staking, or airdrops is taken into account unusual revenue. The quantity of revenue is the truthful market worth of the tokens in U.S. {dollars} on the time of receipt. Bizarre revenue from companies is reported on Type 1040, Schedule 1, or Schedule C. 

Promoting/buying and selling tokens (Capital features/losses): When a taxpayer sells or exchanges tokens, utilizing tokens to purchase something for fiat foreign money, different crypto, or items/companies, it’s one other taxable occasion that triggers a capital acquire or loss primarily based on the distinction between the FMV obtained and the taxpayer’s price foundation (unique worth when acquired). 

Quick-term (held one yr or much less) features are taxed at unusual revenue charges (as much as 37%).  Lengthy-term (held a couple of yr) features profit from preferential capital features charges (0%, 15%, or 20%). Moreover, NFTs that signify artwork or different objects sometimes categorized as “collectibles” could be topic to the next collectibles capital features tax fee, as much as 28%. The IRS makes use of a “look-through evaluation” to find out the underlying asset’s nature. Capital transactions are primarily reported on Form 8949 and Schedule D.