Future Insight | Behind the Screen: The Infrastructure Powering Entertainment

Chips and networks driving every pixel

Every streaming session or multiplayer game starts with computing power. The global AI chip market is valued at approximately $53 billion in 2024 and is expected to reach $296 billion by 2030 [1]. The entertainment industry's demand for computing power, from training recommendation algorithms to rendering visual effects in real-time, is a key driver.

Companies like NVIDIA have redefined graphics processing units (GPUs), making them central to cloud gaming platforms and AI production tools. Broadcom and Qualcomm provide 5G semiconductors that support mobile streaming and gaming. The 5G infrastructure market is expected to grow from $17 billion in 2024 to $96 billion by 2030 [2].

Content delivery networks (CDN) can reduce latency for live streaming and high-definition streaming. The CDN market, valued at $27 billion in 2025, is expected to reach $145 billion by 2032, driven by growing demand for ultra-high-definition content [3]. This layer of infrastructure, including chips, 5G networks, and content delivery, enables smooth, buffer-free entertainment experiences.

Gaming represents the most demanding application scenario in entertainment. Cloud gaming is projected to grow from $10 billion in 2025 to $122 billion by 2032 [4], requiring large GPU arrays in data centers and ultra-high-speed networks. Multiple companies in the Nasdaq 100 index provide chips, networks, and server infrastructure that support these experiences.

AI Transforms Production Economics

AI is reshaping content creation. Adobe’s creative suite includes generative AI tools that help studios accelerate editing and localization. Industry analysis indicates that AI-driven rotoscoping (separating subjects from the background in videos) can save 20% to 60% of time, depending on scene complexity [5]. One studio used AI voice synthesis to cut localization cycles from 45 days to 12 days [6].

Director James Cameron has stated that AI has the potential to halve visual effects costs by accelerating workflows [7]. In large-scale productions, visual effects often cost tens of millions of dollars, so efficiency improvements will significantly impact economic benefits. Microsoft's Azure cloud provides real-time dubbing and personalized AI services for in-game use.

For entertainment companies, AI not only reduces production costs but also unlocks new creative possibilities. The AI market in the film industry was valued at approximately $3 billion in 2024 and is expected to reach $14 billion by 2033 [8].

Large-Scale Personalization Engines

Behind platforms like Netflix and YouTube (owned by Alphabet’s Google) are personalization systems processing massive amounts of data. These recommendation engines, powered by AI, cloud computing, and custom processors, determine when and how content is presented. The technology supporting this personalization is as important as the content libraries themselves.

Investment implications

Entertainment is both a story of consumption and an infrastructure story. Through the Nasdaq 100 Index, investors can access companies across multiple layers:

1. Semiconductors: Companies such as NVIDIA, Broadcom, and Qualcomm provide chips needed for data centers, networks, and devices.

2. Cloud and AI Infrastructure: For example, Microsoft and Amazon provide production and distribution platforms that studios rely on

3. Creative Tools: For example, the Adobe suite, used by over 30 million creative professionals worldwide

4. Delivery Platforms: Integrating content with technological infrastructure to achieve personalization and distribution

Instead of choosing individual entertainment companies, investors might consider purchasing a basket of stocks through index investing to gain broader exposure to the ecosystems supporting these companies. Growth in infrastructure areas such as AI chips, cloud gaming, and Content Delivery Networks (CDN) is expected to outpace traditional content spending [9].

Risks and Real Challenges

Innovation comes with uncertainty. The semiconductor industry faces cyclical demand and supply chain risks. Streaming platforms need to manage content costs and profitability pressures. Regulatory and intellectual property issues introduced by AI tools are still evolving. The adoption rate of emerging platform technologies may differ from projections.

However, the trend towards more immersive, interactive, and personalized forms of entertainment is becoming increasingly clear. Meeting this demand requires technological investment across the entire production and distribution chain. As entertainment technology becomes more complex, companies providing infrastructure are playing an increasingly important role.

The entertainment of the future will be defined not only by content but also by the invisible technologies behind the scenes that drive its creation and delivery.

Source:

1. NextMSC, data as of February 2025.

2. Grand View Research, data as of 2024.

3. Grand View Research, 'Content Delivery Network Market Size and Report, 2030,' data as of 2024.

4. Fortune Business Insights, data as of September 2025.

5. Roland Berger, 'AI Innovation in Visual Effects and Animation,' 2024.

6. Mordor Intelligence, data as of June 2025.

7. The Hollywood Reporter, 'James Cameron Believes AI Could Halve Blockbuster Costs,' April 9, 2025.

8. Market.us, data as of May 2025.

9. PwC, 'Global Entertainment and Media Outlook 2025–2029,' July 24, 2025.

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