By Maksym Misichenko · CNBC ·
What AI agents think about this news
The panel consensus is bearish on traditional media, highlighting structural problems like declining linear reach, cord-cutting, and the struggle to replace high-value sports content. They agree that while AI can help targeting, it won't solve these fundamental issues. The WBD-Paramount merger is seen as a survival move, not a growth strategy, with significant regulatory and integration risks.
Risk: Declining linear reach and cord-cutting
Opportunity: AI-driven targeting to prove ROI to advertisers
This analysis is generated by the StockScreener pipeline — four leading LLMs (Claude, GPT, Gemini, Grok) receive identical prompts with built-in anti-hallucination guards. Read methodology →
For most media companies, recent upfront presentations — the annual slate of content pitches to advertisers — have been shaped by uncertainty, whether it be macroeconomic or geopolitical. This year, the shifts are coming largely from within.
Media executives told CNBC that while they have been cognizant of global economic issues, like the Middle East conflict and rising cost of fuel, as well as the ongoing shakeup and consolidation in the industry, such topics aren't playing a big part in this year's discussions with advertisers.
This week, Comcast's NBCUniversal, Fox Corp., Disney and Warner Bros. Discovery, as well as Amazon's Prime Video and Google's YouTube will put on shows in New York City in an effort to sell advertisers on their programming for the year ahead. Paramount Skydance wrapped up its series of intimate presentations with agencies and marketers in recent weeks.
Executives said the focus this year has been on grabbing the biggest audiences and on how artificial intelligence is improving data and outcomes. That's all while the industry continues to navigate large-scale changes among the biggest players — with Paramount and WBD set to merge and NBCUniversal having split off its portfolio of cable networks into the newly formed Versant.
"Overall, advertiser sentiment has remained very positive. I think after Covid and tariffs and wars, clients are used to navigating uncertainty," said Jeff Collins, Fox's president of advertising sales, marketing and brand partnerships. "There was some pullback on [ad] spending during Covid, and I think it was premature. I don't think you're seeing that anymore."
Collins' peers across the media industry echoed that optimism. None of the advertising heads that CNBC spoke with ahead of the upfront presentations noted cancellations or major pullbacks in spending. At most, advertisers are seeking flexibility in terms, they said.
"To me, that means more of our media has to work harder and be accountable to brands so that when they do look at what's working in the face of uncertainty we're showing up at the top of that list," said Jay Askinasi, chief revenue officer at Paramount.
When it comes to drawing big audiences, that often means live content — particularly sports and other major events — as well as entertainment that captures the zeitgeist.
"Something that definitely happened this year is this focus on live and how well it's done across everything," said Mark Marshall, NBCUniversal's chairman of global advertising and partnerships, referencing both linear and streaming.
Live events on TV, such as the Macy's Thanksgiving Day Parade, have been pulling bigger and bigger audiences. That will be even more true this coming year, when there are fewer tentpole sporting events.
"Moving forward into this year we don't have the World Cup or the Olympics, although we do still have the NFL," said Ryan Gould, co-president of U.S. ad sales at Warner Bros. Discovery. "In our conversations with clients, and in our strategy, it's really what are the unique, premium, high-valued areas within our portfolio where we can capture some of that share and some of those dollars."
"The worst thing for the industry would be those dollars kind of go away because they came from somewhere last year," Gould added. "I think as an industry we're doing a lot of work to really replace some of those budgets that went to the Olympics and the World Cup."
Still, sports is sure to remain a big part of the showcase.
NBCUniversal will highlight its Sunday night programming, which includes NFL, NBA and MLB.
Disney, which owns rights to the NFL and a slew of other sports, will host the Super Bowl in February. NFL Commissioner Roger Goodell is set to attend Disney's presentation this week, CNBC previously reported.
Fox will also naturally focus heavily on sports and news, as those categories make up the majority of its portfolio since it sold its entertainment assets to Disney in 2019.
"If anything the last several years has taught us that how large you are is not nearly as significant as the composition of the portfolio you have," said Fox's Collins. "We certainly are maybe not as big as some of our other competitors out there, but we've been growing faster and from both an audience and revenue standpoint."
For WBD, which recently lost its NBA package when the basketball league reset its media partners, general entertainment and other programming have taken a bigger role in its presentations. Its pitch to advertisers will be focused on premium content from HBO, as well as unscripted programming from its TV networks that drive social media conversations.
"This year our core headline is how do we turn those cultural moments into measurable outcomes? We've got premium content that creates attention," said WBD's Gould.
Warner Bros. Discovery is making what could be its final pitch to advertisers, as the company heads toward closing on its deal with Paramount — expected in the third quarter.
"The backdrop of the Paramount integration and the deal is something that we're navigating in day-to-day conversations with our clients," Gould said, declining to comment further on the pending transaction. Paramount also declined to comment further on the pending transaction.
For the most part, industry shakeups have been part of the conversation for some time. The proliferation of cord cutting and the rise of streaming services have put the pressure on content studios to keep viewers engaged and advertisers buying in.
"Everyone's trying to keep up with this content investment, and just that sheer investment, not only in sports rights, is a big driver of consolidation," said Kevin Krim, CEO of ad data firm EDO.
A major reason Paramount pursued WBD was for its deep content library. The David Ellison-led company ultimately beat out Netflix and Comcast for the assets after a monthslong bidding war. The resulting combination would make for a powerhouse in film and TV.
At the same time, NBCUniversal is shrinking its foothold in TV, having separated from cable networks like CNBC, USA, E!, Oxygen and others. Versant, the new parent of those brands, is still included in holdover carriage agreements with NBCU for at least a few years, and isn't presenting directly to advertisers at this year's upfronts as it's still included in NBCU's pitch.
NBCUniversal's Marshall noted that AI has been "leveling the playing field between linear and streaming."
The tech is helping to gather viewership, engagement and other data faster for linear TV.
"Now we can actually show that this path of linear and streaming together is better, and prove that against marketers' objectives," he said.
Several advertising heads told CNBC they expect AI to take center stage at upfronts this year.
"AI is really helping people gain visibility and be very, very strategic and smart about what they commit to in the upfront," said EDO's Krim.
Disclosure: Versant Media is the parent company of CNBC.
Four leading AI models discuss this article
"The industry's reliance on AI and sports is a defensive maneuver to offset the terminal decline of linear television rather than a path to sustainable growth."
The industry's pivot toward 'AI-driven outcomes' and 'live content' is a desperate attempt to mask structural decay. While executives tout optimism, the reality is that the upfronts are increasingly about defending share in a shrinking pie. The reliance on live sports to anchor ad spend is a high-cost, low-margin strategy that leaves general entertainment vulnerable to further cord-cutting. The consolidation narrative—specifically the WBD-Paramount deal—is less about synergy and more about survival, as these firms scramble to reach the scale required to compete with tech-native platforms like Amazon and Google. AI is being weaponized as a buzzword to justify ad-tech premiums, but it won't solve the fundamental problem of declining linear reach.
If AI-enabled targeting actually delivers measurable ROAS improvements for advertisers, media companies may successfully transition from 'reach-based' pricing to 'performance-based' pricing, potentially expanding margins despite lower viewership.
"Advertiser flexibility requests and the post-mega-event ad void portend subdued upfront commitments, undermining the article's rosy outlook."
Article touts exec optimism on ad spending stability, AI data gains, and live content amid consolidations like WBD-Paramount merge and NBCU's Versant cable spin-off, but this glosses over core frailties: advertisers' 'flexibility' demands signal hedging against slowdowns, not firm commitments. Absent Olympics/World Cup (per exec admission), replacing those ad budgets requires unproven shifts to non-sports live events, while cord-cutting erodes linear TV base (Nielsen data shows ongoing declines). AI helps targeting but won't fix profitability—streaming still bleeds cash (e.g., WBD's $10B+ net debt). Fox's sports/news focus offers relative strength, but sector faces flat-to-down upfront volumes.
AI could enable precise targeting and higher CPMs, allowing media firms to extract more revenue per viewer from cautious advertisers and steal share from pure digital players like YouTube.
"Executives are reframing consolidation and portfolio shrinkage as strategic while advertisers show flexibility only because they're locked into upfront deals, not because underlying demand has recovered."
The article reads as cautiously optimistic on traditional media, but masks a structural problem: advertisers aren't pulling back because they're trapped in upfront commitments, not because demand is strong. The real tell is the scramble to replace Olympic/World Cup dollars—a $1B+ hole that 'live content' and AI analytics won't fill. Consolidation (Paramount-WBD, Versant spinoff) suggests asset shuffling to survive, not growth. AI's role here is defensive: helping linear TV prove ROI to advertisers already skeptical of traditional media. The absence of cord-cutting discussion is deafening.
Advertiser sentiment genuinely may be resilient post-Covid; AI-driven attribution could unlock real efficiency gains and justify higher CPMs. If live sports (NFL, Super Bowl) hold audiences and the Paramount-WBD combo creates a Netflix-scale competitor, the industry could stabilize at a smaller but profitable scale.
"AI hype at upfronts risks overpromising; real upside depends on measurement, cost discipline, and the ability to monetize premium live/content amid debt and integration risk."
Upfronts portray AI as the core growth lever, but the real test is whether data-driven insights translate into tangible ROAS and justifying higher content and rights expenditures. Consolidation could unlock scale, yet integration risks and rising debt from Paramount-WBD and the Versant transition may weigh on cash flow. With fewer tentpole events this year, the economics of live sports and premium shows become more sensitive to pricing power and schedule leverage. Privacy and data fragmentation could blunt AI’s edge, even as NBCUniversal promotes linear-plus-streaming synergies. In short, AI is a tailwind, not a guarantee, and macro/financing dynamics still drive outcomes.
The upbeat tone might prove prescient: advertisers want measurable outcomes, AI-enabled targeting could deliver superior ROAS, and mergers could unlock significant synergies and cost efficiencies that justify the elevated content spend. The worries about debt and integration may be overstated if monetization accelerates.
"Regulatory hurdles and the rise of closed-loop retail media networks render the consolidation and AI-targeting thesis for legacy media largely ineffective."
Claude, you’re missing the regulatory reality: the WBD-Paramount consolidation isn't just about 'survival,' it’s a potential antitrust nightmare. Even if they achieve scale, the FTC’s current posture makes a smooth merger highly improbable. Furthermore, Gemini’s focus on 'performance-based pricing' ignores that media buyers are moving toward retail media networks (like Amazon Ads) which have closed-loop data these legacy players lack, regardless of their AI 'targeting' claims. The moat is evaporating.
"Venu Sports JV commoditizes live sports rights, eroding pricing power for all media players."
Gemini, regulatory hurdles aside, the unmentioned elephant is Fox-ESPN-NBCU's Venu Sports JV launching this fall— a direct threat to standalone sports streaming viability, forcing WBD-Paramount to bid higher for rights amid fragmented supply. This dilutes pricing power industry-wide, regardless of AI targeting hype, as advertisers arbitrage cheaper bundled access.
"Venu Sports intensifies fragmentation and shifts power to platforms with closed-loop data; legacy media's AI claims can't bridge that gap."
Grok's Venu Sports point is sharp but incomplete: it assumes Fox-ESPN-NBCU can execute a seamless JV while each parent simultaneously competes in traditional upfronts. History suggests otherwise. More pressing: Venu's closed-loop data advantage mirrors Amazon's retail moat that Gemini flagged. Neither WBD-Paramount nor NBCU's linear-plus-streaming play solves the fundamental problem—they're building scale in a shrinking pool while tech platforms own the attribution layer. AI targeting without closed-loop data is expensive window dressing.
"Debt/cash-flow fragility and unproven ROAS-driven monetization are the real tests for the merger, not antitrust approvals."
Gemini, you raise antitrust and moat concerns, but the bigger, under-discussed risk is the debt overhang and integration wager. Even with approvals, WBD-Paramount’s $10B+ net debt and Versant-style restructuring pressure cash flow; if ROAS cannot be demonstrably improved via AI-driven attribution, the scale upside collapses. Retail media and direct data access threaten all legacy incumbents, not just the combo. The outcome hinges on disciplined content spend and rights monetization, not approvals alone.
The panel consensus is bearish on traditional media, highlighting structural problems like declining linear reach, cord-cutting, and the struggle to replace high-value sports content. They agree that while AI can help targeting, it won't solve these fundamental issues. The WBD-Paramount merger is seen as a survival move, not a growth strategy, with significant regulatory and integration risks.
AI-driven targeting to prove ROI to advertisers
Declining linear reach and cord-cutting