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The entertainment industry faced major difficulties last year as many media giants were forced to downsize operations. It seems 2023 may bring more of the same hardships.
Over the past weeks, numerous corporations spanning technology, finance, and media announced substantial workforce reductions. Companies such as Amazon, Alphabet, and Unity Software were among those that took steps to shrink their employee base. Universal Music Group, currently the largest music label, prepares to part ways with several members of staff in the coming months. Meanwhile, the animation studio Pixar will also have to bid farewell to some talent later this year. Since 2021, reports indicate that media companies have dismissed more than 70,000 workers in total.
The factors driving these decisions varied between firms. For example, Unity likely hired beyond its needs amid metaverse hype. Alphabet wants to concentrate on artificial intelligence development. Amazon’s livestreaming platform Twitch continues generating losses, as does its movie division following the acquisition of MGM. Amazon video head Mike Hopkins has prioritized ensuring this part of the business can stand on its own financially.
While Hollywood deals with ongoing transformation, many of these corporations still have solid foundations. It may be premature to speculate about troubles at giants like Alphabet or Amazon. For some, core areas like search or e-commerce are maturing after astronomical growth, pushing them to optimize side endeavors or explore new money-making avenues. This week explores forces behind recent downsizing in the music sector. But first, a look at several notable recent developments across the industry.
Microsoft has surpassed Apple as the most valuable company worldwide. Warner Bros saw enormous success with its Harry Potter role-playing game. The NFL grew viewership on all major platforms. ESPN dove into sports betting. And calls emerged for examining South Korean media after a star of Parasite apparently took her own life.
Overall, the period brought both difficulties and bright spots showing the industry’s complex dynamics in a time of great transition. Stakeholders will need to thoughtfully navigate challenges while cultivating new opportunities.
