Sep 25, 2026 · 39 min
Hollywood’s production model fractures as AI raises the stakes
Hollywood Was Cooked Before AI, and Now It's Only Getting Worse
Los Angeles is losing not only filming activity but also the collaborative workplaces and local spending that once anchored its cultural economy.
- 1Streaming and tax incentives shifted production away from Los Angeles, shrinking employment and weakening the city’s creative ecosystem.
- 2Smaller writers’ rooms and powerful content libraries are changing how television creates, distributes, and monetizes entertainment.
- 3Horror remains comparatively resilient, while AI intensifies debates over which creative and production jobs can survive.
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Hayes Davenport explains why horror remains one of Hollywood’s healthiest genres while other creative categories struggle with shrinking budgets and AI pressure.
The brief
At a live show in Hollywood, Hayes Davenport joins Tracy Alloway and Joe Weisenthal to examine why the entertainment industry was weakening before generative AI arrived.
Streaming disrupted network and cable television, while tax incentives and lower labor costs pulled productions elsewhere; Los Angeles retained studio space but lost enough demand to fill it.
The contraction reaches beyond soundstages: smaller writers’ rooms, fewer local jobs, and less spending threaten restaurants, small businesses, tourism, and the city’s cultural identity.
Older libraries such as Family Guy remain formidable competitors through reruns and memes, even as the industry debates whether AI can replace creative or below-the-line work.
Horror offers a counterexample, using modest budgets and strong commercial upside while comedy faces abundant free content and uncertain economics.
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Hollywood
Family Guy
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