Media Stack, Ownership, and the New Rules of Media
System Alerts: AI Infrastructure, Incentives & the Shape of What’s Next
While most coverage still gravitates toward shiny features and product launches, this week’s signals reveal deeper shifts in AI economics, streaming strategy, and platform governance. Together they underscore a paradox: money and ambition are pouring in, but impact and stability remain elusive.
This edition covers four critical moves: the productivity paradox of AI investment, a bold sports rights play, an acquisition in emotional audio intelligence, and new governance rules from one of the world’s most scrutinized platforms.
Companies Pour Billions Into AI With Little Payoff So Far
Steve Lohr at the New York Times has revived an old phrase with new relevance: the productivity paradox. Just as in the 1980s, when companies invested heavily in personal computers without immediate gains in efficiency, today’s corporations are pouring billions into generative AI without much to show on the balance sheet.
International Data Corporation (IDC) projects nearly $62 billion in enterprise spend this year on generative AI systems, nearly doubling 2024 levels. Yet McKinsey finds that eight in ten companies report “no significant bottom-line impact,” and S&P Global says abandoned AI pilot projects jumped from 17% in 2023 to 42% in 2024.
The explanation is familiar: the technology curve runs ahead of organizational capacity. The tools are powerful, but companies lack trained staff, cultural buy-in, and the operational maturity to weave AI into their workflows. Even when projects succeed, they’re often narrow wins—like Johnson Controls’ AI tool that saves 10 minutes on a repair call, or JPMorgan’s internal chatbot that shaves hours off analyst reporting. Useful, but not transformational.
Why this matters: The current winners are predictable. Nvidia in chips, Microsoft, Google, and Amazon in cloud services. But for enterprises outside tech, the real payoff will come only after years of testing, failing, retraining, and institutional learning. Gartner is blunt: AI is sliding into the “trough of disillusionment.” That’s not failure. It’s the phase before consolidation and scaling. The lesson for executives is to keep investing, but with patience: the real competitive advantage won’t come from early experiments, but from building the infrastructure and culture that can absorb AI when it stabilizes.
NYT: Companies Are Pouring Billions Into A.I. It Has Yet to Pay Off
Paramount Skydance Bets $7.7B on UFC
David Ellison didn’t waste time making his mark on the newly merged Paramount Skydance. Within days of closing, he cut a seven-year, $7.7 billion deal for exclusive UFC rights ending ESPN’s long run and eliminating UFC’s reliance on pay-per-view.
For Paramount, the move solves a few problems at once. It fills gaps in the sports calendar. UFC is year-round, unlike the NFL or March Madness. It gives Paramount+ a marquee property to attract a loyal fan base. And it signals, loudly, that the new Paramount will not sit quietly on the sidelines of sports rights.
But it also exposes the scale gap. Paramount+ has 77 million subscribers. Disney has 156 million. Netflix has 301 million. No single rights deal can bridge that distance. Which is why many analysts suggest the UFC deal is less about direct ROI and more about posturing for future bundles (a Peacock–Paramount+ tie-up is rumored) or even for larger plays like TikTok.
Why this matters: Sports rights are often presented as defensive assets ways to keep subscribers from churning. But in the streaming wars, they’ve become signaling devices. By overpaying for UFC, Ellison shows regulators, partners, and Wall Street that Paramount is prepared to act boldly. That stance matters if, as some speculate, Paramount is angling for adjacency moves into short video or other media sectors. The UFC may not deliver Netflix-scale subs, but it buys time, attention, and leverage.
The Information: The UFC Alone Isn’t Enough Streaming Punch for David Ellison’s Paramount
Meta Acquires AI Audio Startup WaveForms
Meta’s latest AI acquisition isn’t about scale, it’s about senses. After buying PlayAI last month, Meta has now acquired WaveForms, a young startup focused on emotion-detection through voice. Founded just eight months ago, WaveForms had already raised $40M at a $160M valuation, with founders hailing from OpenAI and Google.
On the surface, this is a tuck-in deal. But strategically, it’s revealing. Voice and emotional intelligence are the missing ingredients in Meta’s long-term vision of immersive, embodied computing. Smart glasses, VR prototypes, and AI assistants all suffer from the same limitation: they’re technically capable but emotionally flat. A system that can not only transcribe what you say but also interpret how you feel is a step closer to assistants that feel present, not mechanical.
Why this matters: While OpenAI and Anthropic chase scale, Meta is chasing affect. It’s a reminder that the AI race won’t just be measured in FLOPs or benchmark scores it will be measured in the ability to build systems that users trust and relate to. WaveForms might be a small acquisition, but if it helps Meta’s AI sound less like a machine and more like a companion, it could shift adoption curves. And it shows Meta plugging holes via M&A while its internal superlab remains turbulent.
TechCrunch: Meta acquires AI audio startup WaveForms
TikTok Tightens Rules for Live Creators
TikTok has quietly updated its Community Guidelines, requiring Live creators to disclose commercial content more explicitly. On its face, this is just a policy tweak. But in context, it’s a defensive move as the company faces ongoing scrutiny in Washington and mounting pressure around a possible U.S. sale.
Live is one of TikTok’s fastest-growing surfaces, both for engagement and monetization. But it’s also where regulatory risk concentrates: influencer marketing, opaque sponsorships, and youth-targeted commerce all converge there. By tightening disclosure, TikTok is trying to show regulators that it can police itself.
Why this matters: Governance is no longer a back-office compliance function. It’s a frontline competitive tool. Platforms that get ahead of regulation can keep growing; those that resist often end up constrained later. TikTok’s move is a signal to other platforms: disclosure and transparency are now table stakes, especially as live and commerce converge. For creators, it’s another reminder that platforms are not neutral, they’re political actors managing their own risk.
TechCrunch: TikTok updates Live guidelines
Closing Note
From AI’s stalled payoffs to Paramount’s sports swing, Meta’s bets on emotional intelligence, and TikTok’s defensive rule-making, the theme this week is ambition meeting limits. The limits vary(economic, structural, regulatory) but the pattern is consistent.
We’ve seen it before: PCs in the 80s, the internet in the 90s, mobile in the 2000s. Early exuberance. A trough of disappointment. Then, years later, the real inflection point. This is how technology embeds itself not in straight lines, but in arcs.
For executives and strategists, the task isn’t to chase every spike of hype. It’s to read the signals beneath them: where investment is sticking, where incentives are shifting, where governance is tightening. That’s where the next durable layer of the media stack is being built.