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Part I: A New Era of AI in the Entertainment Industry

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By: Averi Allison, Tatiana Behar Russy, Erin Coughenour, Julia Timmons

Image Source: Faceware

As exemplified by the Hollywood strikes of 2023, we find ourselves in a new era of Artificial  Intelligence in film and television. While studios are looking to cut costs, performers seek job security, and consumers seek quality content. Through research conducted in collaboration with facial motion capture technology provider Faceware Technologies Inc., Master of Entertainment Industry Management students at Carnegie Mellon sought to gain insight on how AI-generated content will transform existing industries, including how this technology could affect employment in the entertainment industry, content development,  budgets, contracts, legislation, and privacy rights.

The use of facial recognition technology has proven to have a wide range of applications in our daily lives, such as unlocking phones and verifying expenses. In the entertainment industry, facial capture technology is used in film, television, video games, and more. Implementation of this technology is commonplace for creating Computer Generated Imagery (CGI) in visual media such as animated films or realistic avatars in video games. However, the technology may also be subject to AI, likeness, and privacy concerns which are currently affecting every sector of the industry. 

This research provides an in-depth analysis of the current market for AI in the entertainment industry, such as facial capture technology and digital replicas, and highlights the emerging legal and regulatory boundaries of this technology, including privacy and data regulations and the new TV/Theatrical Contracts.

Terms

  • Artificial  Intelligence (AI): The capacity of computers or other machines to exhibit or simulate intelligent behavior; Software used to perform tasks or produce output  previously thought to require human intelligence, esp. by using machine  learning to extrapolate from large collections of data (Oxford English  Dictionary, 2023).

  • Background Actor Digital Replicas: A digital replica of the voice or likeness of a background actor created with  the actor’s physical participation for the purpose of depicting the  background actor in a scene in which they did not actually appear (Screen  Actors Guild, 2023).

  • California Consumer Privacy  Act (CCPA): Gives consumers more control over the personal information that businesses  collect about them. This landmark law secures new privacy rights for  California consumers, including the right to know about the personal  information a business collects about them and how it is used and shared; The right to delete personal information collected from them (with some  exceptions); The right to opt out of the sale or sharing of their personal  information; and the right to non-discrimination for exercising their CCPA  rights (“California Consumer Privacy Act,” 2023).

  • Digital Replica: A replica of one’s voice and/or likeness that is created using digital  technology, such as artificial intelligence (Screen  Actors Guild, 2023).

  • Employment - Based Digital Replica: A digital replica that is created in connection with one’s employment on a  motion picture. Motion facial capture technology might be used to achieve  this type of replica (Screen  Actors Guild, 2023).

  • Generative Artificial  Intelligence: Generative Artificial Intelligence (Generative AI) is a type of AI that can  create new content and ideas, including conversations, stories, images,  videos, and music. (“What Is Generative AI,” 2024).

  • General Data Protection Regulation (GDPR): A legal framework that sets guidelines for the collection and processing of  personal information collected from individuals residing in the European  Union (EU). These regulations apply to non-EU-based companies that serve  EU consumers. The main topics addressed in the GDPR include but are not limited to data  protection principles, accountability, data security, data protection, data  processing, consent, and people's privacy rights (Wolford, 2023).

  • Independently - Created Digital Replica: A digital replica of an individual created without the individual’s  participation and used in a motion picture in which they did not work (Screen  Actors Guild, 2023).

  • Likeness: One's appearance that can be captured, replicated, and manipulated by facial  capture technology (Screen  Actors Guild, 2023).

  • Motion Facial Capture: The digital capture of human facial movement and expression; used to  humanize animation by facilitating accurate superimposition of natural  human facial movement onto animated characters (Wolford, 2023).

  • Synthetic Performer: A digitally-created asset that: (1) is intended to create, and does create, the  clear impression that the asset is a natural performer who is not recognizable  as any identifiable natural performer; (2) is not voiced by a natural person;  (3) is not a Digital Replica; and (4) no employment arrangement for the  motion picture exists with a natural performer in the role being portrayed by  the asset (Screen  Actors Guild, 2023).

Background

Artificial Intelligence has been around since the 1950s, but there has been an AI boom in  the early 2020s, with private companies and universities in the U.S. leading significant advances  (Frank, 2023). While 27% of Americans say they interact with AI at least several times a day,  and 28% think they interact with it several times a week, a shocking 44% of Americans do not  believe that they interact with AI (Kennedy, 2023). In the entertainment industry, AI can not  only generate content, but also identify opportunities and trends, analyze metadata from social  media, predict how well a movie will do at the box office, create visual special effects, lip-sync  for foreign films, de-age actors, and clone voices (The Economist, 2024a).  

AI technology is already having a substantial global economic impact. In a report conducted by McKinsey Digital, it was estimated “that Generative AI could add between $2.6  trillion and $4.4 trillion to the global economy annually in the coming decades” (Chui et al.,  2023, para. 7). Within media and entertainment, AI was estimated to increase overall revenues  anywhere from $80B to $130B annually (Chui et al., 2023). 

Movies have been using AI in their production, especially for visual effects. In terms of  use cases of AI in visual media, Tom Graham, Co-Founder & CEO of Metaphysic, notes that “we can actually do things with AI that are impossible with traditional methods. To get that really hyper realistic look, that doesn’t look uncanny, doesn’t look weird, and doesn’t look CGI” Kell, 2023, para. 7). The other big advantage is that it is much cheaper to do AI than traditional 3D or VFX/CGI. 

According to a recent study, of the people who support the use of AI in TV and Film industries,  42% support the use of artificial intelligence to create special effects or alter actors’ appearances, 38% to generate voices for animated characters, and 29% to generate movie scripts, reiterating  that this technology is already a useful tool for entertainment (“Support of AI use,” 2023). Figure  1 also shows support for the use of AI-generated “digital twins,” which we would now refer to as  “digital replicas.” The figure references what we would now refer to as “Background Actor  Digital Replicas” and “Employment-Based Digital Replicas.” 

Figure 1: Support of AI use cases in TV and film industries in the U.S. 2023  

Note: The data in Figure 1 was collected before the SAG-AFTRA strike was settled. “Digital twins,” are now referred to as “digital replicas” as established in the 2023 TV/Theatrical  Contract. (Source: Statista)

AI is currently used across all stages of filmmaking, including development, pre-production, production, and post-production - as shown in Figure 2 below. Chatbots and Text-to-Image generators such as ChatGPT, Perplexity, Midjourney, and DALL-E are used for ideation,  story co-development, and storyboarding in the development and pre-production. Text-to-Video generators, such as RunwayML Gen-2 and Pika Labs, are used for b-roll, trailers, and title  sequences in production and post-production, as well as for AI-assisted editing and VFX.  Generative AI is already helping filmmakers and creative professionals save time and money,  even though it is still in its early stages. However, actors and writers are concerned about this  type of technology because they believe it could replace them in the labor market. In the future,  AI tools will be able to generate content with cinematic quality and more creator control.  

Figure 2: Current and future AI tools and their uses in moviemaking 

Note: Figure 2 Illustrates the ways in which the TV and Film industry is currently using AI tools.  It also predicts how AI tools will be used in TV and Film in the future. (Source: Medium)

We also found that there are filmmakers and independent producers who  are experimenting with AI-generated short films. These films, which include The Frost, Surprising, and Given Again, are even participating in film festivals like the Sci-Fi London Film  Festival or the Runway AI Film Festival (Raj, 2024). According to Cristobal Valenzuela, co-founder, and CEO of Runway AI Film Festival, “We’re still at the very early stages of this  technology. It’s only a matter of time until you get to a point where you won’t be able to  distinguish live-action from generated video using AI,” (The Economist, 2024b, 4:27). 

Current State of the Industry 

In the summer of 2023, the Writers Guild of America (WGA) and the Screen Actors Guild - American Federation of Television and Radio Actors (SAG-AFTRA) went on strike after  negotiations with the Alliance of Motion Picture and Television Producers (AMPTP) failed to  reach an agreement that the unions felt was equitable to their members. While there were many  issues that both unions were striking for, one of the most significant for both parties was  Artificial Intelligence. 

For SAG-AFTRA, AI was arguably the greatest point of contention. The union’s  proposal regarding AI started as four pages of their agreement and only increased over the course  of negotiations with the AMPTP (Kilkenny, 2023). While the studios felt that negotiations  surrounding AI protections for actors would be one of the more straightforward points of  negotiation, it became one of the more complex issues as legal teams on both sides of the table  broke down the proposed AI protections (Fuster & Lincoln, 2023). In the last week of  negotiations, SAG-AFTRA insiders referred to Artificial Intelligence protections as the “final  hurdle in finalizing a strike-ending deal” (Fuster & Lincoln). 

In the new TV/Theatrical Agreement, both parties laid out the agreed-upon language that  will govern the use of AI in entertainment. The agreement “establishes definitions and coverage  for creation, use, and alterations of ‘digital replicas’ of performers,” specifically identifying  ‘Employment-Based Digital Replicas,’ ‘Independently-Created Digital Replicas,’ and  ‘Background Actor Digital Replicas’ (Screen Actors Guild, 2023, pp. 1, 3, 4). The TV/Theatrical 

Contract further establishes guidelines for performer participation, clear consent and contracts,  usage rights for studios, and the compensation model for the creation and use of digital replicas.  Generative Artificial Intelligence is also defined in the agreement, which includes the terms of  use for ‘Synthetic Performers’ created by Generative AI. (Screen Actors Guild, 2023, p. 3) The  terms agreed upon by SAG-AFTRA and the AMPTP set a revolutionary guideline for AI in  entertainment moving forward, providing a new basis for every industry sector - from editors to  technology providers to business affairs teams and more. 

We introduced the current state of AI in various fields, and new regulations  set forth by the TV/Theatrical agreement, which lays out the agreed-upon language that will  govern the use of AI in entertainment. These new terms will be revolutionary guidelines for AI  in entertainment and provide a new basis for every industry sector. By viewing the world of AI  from a broad scope and then focusing specifically on the entertainment industry, we can illustrate  what is happening today with Artificial Intelligence and how this technology will change the way we create and consume entertainment.

Stay tuned for Part II sharing key findings from survey and interview data provided by entertainment lawyers, educators, and other industry professionals.