Why Is Hollywood in Panic Mode?
Midjourney: Curt Doty
Hollywood, the dream factory, is having a nightmare. From picket lines to pitch meetings, the film industry is gripped by existential dread. But this time, it’s not a new streaming service or box office slump—it’s AI. Artificial Intelligence. Specifically, generative AI tools now capable of creating scenes, scripts, characters, and even performances that were once the exclusive domain of flesh-and-blood artists.
The latest panic centers on AI actress "Tilly"—a photorealistic, emotionally responsive, deep-learning-driven performer some fear could threaten the careers of real actors. But is she really a threat? Or is Hollywood just spinning its wheels in another hype cycle? Let’s look at the facts.
The Math Ain’t Mathin’ Up
First, some perspective. The global AI market is expected to hit $250–300 billion in 2025. Within that, generative AI—which includes text, image, code, and video generation—sits at $30–50 billion. But how much of that belongs to film and Hollywood? A mere 2–4%. That’s it. Source: Grandview Research, Deloitte
Now consider that the major studios—Universal, Disney, Warner Bros., Paramount, Sony, Lionsgate—collectively release around 125 films per year. Across three years (2023, 2024, 2025), that’s 375 theatrical releases, not even including the Streamers slates. CNBC
In the same period, how many AI-generated feature films have hit theaters?
Four.
Yes, four. Out of 375.
That’s 1.07% of the total theatrical market.
If AI filmmakers tout the incredible efficiency, where is the output, beside the sloppy experiments in your LinkedIn feed? So why the existential dread? Because unlike past tech shifts—CGI, digital cameras, or streaming—this one threatens the very structure of power in Hollywood.
Meet the New Studios
Let’s take a look at the players turning the traditional studio system on its head:
Asteria – Moonvalley’s proprietary AI studio is focused on generating original feature film content using in-house generative models. Think of it as a full-stack IP generator, prioritizing *new* stories over sequels.
Wonder Studios – Based in the UK and positioning itself as “the Y Combinator for IP,” Wonder recently launched *Beyond the Loop*, a fully AI-generated anthology series using ElevenLabs and Kling AI. The studio is also adapting children’s books and building new sci-fi/fantasy universes—without legacy gatekeepers.
Staircase Studios AI – Using its ForwardMotion generative system, Staircase is committed to producing over 30 AI-native feature films in four years, each with budgets under $500,000. It’s a volume play, yes—but also focused on overlooked and diverse stories often ignored by the mainstream.
Gennie Studio – Specializes in AI-driven historical recreations and non-fiction storytelling. Think documentaries, but built using synthetic voice, image, and narrative tools.
Vertigo Films & OpenAI (Critterz Project) – This partnership aims to show the world that OpenAI tools can be used for large-scale, franchise-level animated features. *Critterz* is
These aren't side hustles. They're future studios and most are trying to do AI right.
The Films That Made It
So far, only a handful of fully AI-generated features have reached theaters:
Post Truth – The first AI-generated feature to receive a commercial theatrical release (Summer 2025), screened in over 20 cities.
Critterz – Vertigo and OpenAI’s AI-made animated feature, headed for a Cannes premiere.
Run to the West – A 61-minute Korean film blending real actors and AI-driven CGI.
Window Seat – Released in July 2023, it's often credited as the first fully AI-generated feature to play in cinemas.
Four titles. That’s the entire theatrical footprint of AI cinema thus far. If AI were a genre, it would barely register.
And yet, some fear Tilly.
Tilly is not real. Not in the flesh. She’s a digital creation—a model trained on thousands of performances, capable of delivering lines with emotional depth and subtlety. She can cry on cue, modulate her tone, and hit her mark every time. She doesn’t get tired, doesn’t need trailers, and doesn’t join unions.
But she also doesn’t live.
No matter how advanced the simulation, Tilly isn’t a person. She can’t improvise with another actor on set. She doesn’t know heartbreak. She has no inner life. And while she may be perfect for product demos or AI-themed films, she can’t carry the burden of authentic storytelling—at least, not yet. If Sydney Sweeneys last three movies have bombed, Tilly’s will also bomb.
As Renard T. Jenkins put it:
“Every technology change has promised efficiency, but quality storytelling remains a human endeavor.”
Or, as I noted in a recent lecture, “AI in the hands of great storytellers will prove that we still need human auteurs.”
Art vs. Algorithm
The fear isn't really about Tilly. It's about what Tilly represents—a potential future where studios no longer need agents, unions, or even actors. Where writers are replaced by algorithms and audience data dictates narrative structure. Where studios become server farms.
But this future is not inevitable. And if you look closely, you’ll see that the most impactful uses of AI in film today are collaborative—not competitive.
AI helps with voice dubbing (Respeecher), animatics (Runway), visual effects (Wonder Studio), and script ideation (Sudowrite). It can clean up audio, extend backgrounds, and even generate marketing assets. It augments. It doesn’t replace.
Yet.
The Hybrid Era
We are entering a “hybrid era”—where every creative team will include a human and a machine. Not as rivals, but as co-creators. That means today’s students and filmmakers need to learn new tools: how to prompt effectively, how to evaluate outputs, and how to guide the AI toward vision—not cliché.
Hollywood has seen disruption before. From the advent of sound to digital cameras to streaming wars. What’s different now is the speed—and the accessibility. Anyone with a laptop can now storyboard, cast, and produce a short using tools like Pika, Sora, MidJourney, and ElevenLabs.
“We’re at the edge of a change where our devices aren’t just tools—they’re partners.” – Alex Serdiuk, Respeecher
And if Scott Ross is right…
“I would go so far as to say 75% of people employed in VFX today will be replaced by AI.”
Then yes, panic might be warranted—but only if we stick to old paradigms.
Don’t Fear the Tools. Fear the Executives.
The biggest risk isn’t that AI will write the next Citizen Kane. It’s that a studio exec will greenlight a shallow, AI-produced film based on audience data and call it art. The real danger is creative laziness, not technological efficiency.
The solution? Taste. Human, hard-earned, idiosyncratic taste.
We don’t need fewer creatives—we need better ones. Ones who can collaborate with AI. Ones who understand how to push these tools into new narrative territories, not just regurgitate tropes.
Final Cut
Hollywood isn’t dying. It’s decentralizing.
Studios will remain—but so will garage filmmakers, indie auteurs, and TikTok visionaries who harness these tools with more soul than budget. Don’t get me going on Vertical Micro-Dramas. The AI boom may reduce costs, but it won't reduce meaning—unless we let it.
As Josh Otten added in my recent podcast, “The real disruption is not AI replacing artists. It’s AI replacing studios.”
So no, Tilly is not the end of acting. And AI is not the end of Hollywood. But it is the beginning of a new era.
And if you’re still afraid?
Remember: Pixar once said no to Toy Story because “nobody wants to see a movie about talking toys.”
So go ahead. Be scared. But get to work. Remember also, there is a slate of 375 traditionally made films over the next three years. Who is working on them?
You.
About the Author
Curt Doty is a former studio executive and award-winning creative director with deep leadership experience across the entertainment and branding industries.
As the founder of CurtDoty.co, a creative consultancy, Curt has led integrated marketing, multi-channel storytelling, branding, identity, and user experience initiatives for a diverse roster of clients, including NCI, Wizard World, Topps, The Grammys, Maserati, AARP, Spalding, Z-Living, Starz, and The Santa Fe International Film Festival. He is a pioneer in mobile-first vertical storytelling and branded content.
Curt's career in television branding began at Pittard Sullivan, where he developed broadcast design and image campaigns for TV Guide, Discovery, ABC, FX, StarTV Asia, and SAT.1. In movie marketing, he’s worked with Universal Pictures, 20th Century Fox, Fox Searchlight, DreamWorks, Focus Features, Miramax, and Warner Bros., with some famous directors like Spielberg, Del Toro, George Lucas, Justin Lin and many more. He now advises indie filmmakers on packaging and festival strategy.
His Fortune 500 clientele includes GM, Carl’s Jr., Bausch + Lomb, Pond’s, Covered California, Degree, GoGo, Genentech, the Michael & Susan Dell Foundation, TracFone, USPS, Ubisoft, Abbott, the US Army, HUD, and Motorola.
Over the past 15 years, Curt has leaned into innovation—leading R&D projects at Apple, Toshiba, and Microsoft, and pioneering interactive content for mobile, Blu-ray, and multi-touch eBooks at Trailer Park and Bemis Balkind.
Today, Curt’s work explores the intersection of AI and entertainment. A sought-after fractional leader (CCO, CMO), speaker, and AI educator, he focuses on demystifying AI for creatives and executives alike.
He also hosts RealmIQ: Sessions, a podcast spotlighting thought leaders in tech, content, and design—continuing his role as a visionary voice in the future of creativity.
