Tokenization, AI, and Hollywood: A New Era for Streaming in 2025

The expansion of the global tokenization market in 2025 illustrates significant advancements in streaming technology, driven largely by regulatory clarity and the integration of AI. This third part of a four-part series explores the impact of tokenization and AI on Hollywood, highlighting key industry shifts and new monetization strategies.

Key Takeaways

The tokenization market reached about $1.24 trillion in 2025, with impressive growth driven by clearer regulations.
Major consolidation in Hollywood, exemplified by Netflix's potential acquisition of Warner Bros. Discovery.
Streaming has transformed how films and TV shows are produced and consumed, presenting challenges for traditional revenue models.
The rise of watch-to-earn models, leveraging blockchain technology, rewards viewers for engagement.
The integration of AI is reshaping content creation and audience engagement within the entertainment industry.

Tokenized streaming with edge technology and AI fundamentally transformed Hollywood and global film and TV distribution

The Transformation of Hollywood through Tokenized Edge Cloud Streaming and AI

Hollywood, representing the apex of the global media and entertainment sector, has seen major shifts due to the rise of streaming technologies. Traditionally, major studios such as Universal Pictures, Paramount, Warner Bros., Walt Disney Studios, and Sony Pictures have controlled approximately 80 to 85% of U.S. box office revenue through their extensive networks of film and television programming.

In 2025, a notable power shift occurred as a significant merger took place. Netflix announced in December 2025 its agreement to acquire Warner Bros. Discovery for roughly $82.7 billion, pending approvals. This news prompted a counteroffer from Paramount, another major player, which raised concerns about the future structure of the Hollywood landscape.

Actor Matt Damon has expressed concerns that streaming diminishes cinema's financial viability by cutting backend revenues, such as royalties from home video sales. He cited his film Air, which, while streamed worldwide via Amazon Prime, struggled to recoup its $90 million budget. This phenomenon underlines a broader trend where streaming platforms are investing heavily in international productions, shifting filming locations to countries with favorable tax incentives.

Political discussions have also emerged, with U.S. President Donald Trump voicing concerns about production jobs moving overseas. He proposed a 100% tariff on foreign films, framing it as a national security issue to incentivize studio production in the U.S. Amidst these economic and political shifts, streaming technology by major players like Netflix and Amazon continues to reshape production and distribution norms.

Image of streaming service comparisons and rankings

The Rise of Edge Cloud Streaming

The COVID-19 pandemic accelerated the digital transformation of Hollywood, fostering a shift toward streaming-first models and a decline in traditional cinema attendance. Companies like Amazon Web Services and Google Cloud are enhancing their services to include edge computing, which allows media businesses to manage applications closer to users for improved streaming experiences.

Edge cloud technology complements blockchain, enabling secure content delivery and decentralized distribution models. This architecture supports various monetization strategies—such as subscription services and ad-supported models—while maintaining the high-quality streaming experience viewers expect.

Watch-to-Earn: Revolutionizing Engagement

Emerging concepts like "watch-to-earn" are changing the way users interact with streaming services. By leveraging blockchain, viewers can earn cryptocurrency or digital assets through their engagement. The Basic Attention Token (BAT) and Theta Network are prominent examples, with the former facilitating direct payments to creators via the Brave browser, while the latter rewards users for sharing bandwidth and computing power to improve streaming quality.

Beyond BAT and Theta, numerous platforms such as Rewarded.tv and Verasity demonstrate the growing popularity of this model in the streaming economy.

The Role of AI in Connecting Creators and Audiences

AI is increasingly becoming integral to content development and distribution within the entertainment sector. Companies like Netflix and Amazon Prime employ machine learning to refine their content recommendations, influencing up to 80% of what viewers choose to watch on platforms.

Additionally, AI tools are being utilized by entities like Cineverse to help creators connect with opportunities across streaming platforms. Through partnerships with networks such as Theta, content that is enjoyed can also reward viewers with tokens, enhancing the interactive viewing experience.

Navigating Taxation in the New Streaming Economy

As tokenized streaming services evolve, understanding their tax implications is crucial. The U.S. IRS has specific guidelines pertaining to digital assets, requiring reporting of all income, regardless of payment method. This includes maintaining accurate records of token transactions and compliance with tax regulations.

For instance, tokens received as compensation for watch-to-earn activities are considered ordinary income based on their fair market value at the time of receipt. Furthermore, selling or trading tokens may lead to capital gains or losses, impacting tax obligations based on the duration of ownership.

This complex regulatory landscape illustrates the significant challenges and opportunities arising in the new era of tokenized streaming, emphasizing the importance of both stakeholders and creators in adapting to these changes.