Cinema Mucho Gusto's 2026 Cinema Industry Predictions

Each year, CMG forecasts the major events impacting the cinema industry over the next year. For 2026, the changes will be profound. 

•  The U.S. box office will exceed $10 billion in 2026, while global admissions, fueled by Hollywood releases, will exceed $35 billion. The cinema is back and will be stronger than ever.

Just a few of the 2026 releases

•  Micro-dramas will continue to grow exponentially in user popularity. With 40% of viewers being 18-45 males, the emphasis of these short-form soap operas (with minimal subscription fees) will be on action and sci-fi content. Check out ReelShort, DramaBox, and FlairFlow, to name several.

•  The face of Hollywood is changing. The industry will continue to consolidate with a slew of new CEOs, which will change how studios operate. David Ellison at Paramount (and possibly Warner Bros. if Netflix doesn't win the bid), Lachlan Murdoch at Fox, Mike Cavanagh at Comcast/Universal, and a new head at Disney (yet to be announced).

David Ellison - The young bloods take over Hollywood

•  2026 will debut the first AI-generated movie star to be featured in a first-run film. Whether it will be accepted by mainstream moviegoers (let alone mainstream Hollywood) is iffy. Exceptional AI-generated content will go viral and be viewed by millions.

Tilly Norwood, the first AI-generated movie star

• In early 2025, California passed a law expanding the film and TV tax credit program by $750 million. However, the changes in the tax program have come too late. There are simply too many film/TV production sites (both in the U.S. and overseas) that offer significantly lower labor and material costs than those in California. 

• YouTube will remain the King of all media. In 2026, not only will it retain its throne, but also become the largest pay-TV platform in the U.S. YouTube currently has 125 million subscribers to its Premium and Music channels. Primetime and Sunday Ticket platforms will be added in 2026. Without doubt, YouTube will be the biggest source of entertainment, creator programming, pay TV, and user/subscription dominance in the world.

Google has it all: YouTube, AI, Waymo, Search, Cloud

• Disney will purchase Taylor Swift's production and events company for a cool $4 billion. Disney+ will become the exclusive home to Swift's content, over which Taylor will continue to retain full creative control and veto power. Her music is not being sold, but Disney will have first dibs on all properties and will distribute the first animated movie musical featuring Swift songs.

By: Jim Lavorato

Major Studios Collab with Gaming Platforms

 Gaming platform Roblox has 151 million active users worldwide. That's more than the number of subscribers to Disney+, HBO Max, and roughly one-quarter of the number of Netflix users combined.

The movie studios are taking note of these high user numbers and are focusing on collaborations with online gaming companies, like Roblox and Fortnite (which has 40 million daily users). 

"It's a huge opportunity, says Rahul Gautam, media and entertainment consultant," as Roblox and Epic Games' Fortnite have set a foundation that is eye-opening for intellectual property holders as they see great potential for brand extension and use of previously successful movies or streamed original content."

Creating great content is one thing, but distribution is another, and gaming platforms fill a specific yet huge distribution need. The amount of revenue that gaming platforms generate (Roblox $4.5 billion, and Epic Games $5.7 billion) cannot be ignored, coupled with the young and massive fan base these platforms serve.

Last month, Roblox introduced facial age recognition checks for all users, a move that the major studios insist upon. Roblox has already signed cooperative deals with Lionsgate, Sony, Netflix, and toy-maker Mattel. Fortnite has inked collabs with Lego, Netflix, Warner Bros., and Disney.

By: James Lavorato

AI and The Human Factor in Filmmaking

 AI is a mega-trend, meaning it will have significant social, economic, and consumer impact over the next 10 - 20 years. It has already reshaped creative work, education, healthcare, and business decision-making.

But, while AI accelerates productivity and lowers business entry barriers, it does not remove the need for taste, responsibility, and judgment. 

Tool-based skills, like those of a camera operator, will be replaced by AI

What separates AI-generated images, films, and animations is human judgment and emotions. AI should be thought of as a human-machine collaborator. The artistic endeavor remains a form of emotional communication between people. Without this emotional connection, technological advances are meaningless. While AI blurs the boundary between producer and consumer, human judgment is essential and influenced by ethics, sensitivity, curiosity, and experience that cannot be replicated by data. 

Avatars may replace actors 

For the movie industry, there will inevitably be collaborations between filmmakers and AI models. Currently, there are no technical limits, and looking forward, AI will expand the physical limits of creation but not of judgment and responsibility as its use remains in human hands.

By: James Lavorato

Is the Cinema Back?

 Arguably, COVID-19 impacted the cinema industry more than any other. From March 2020 to April 2021, virtually all cinemas were shuttered - and it has taken four years to recover. The fact that there were massive Hollywood film strikes, which started in September 2023 with the Writers Guild and ended in July 2025 with a deal inked between the studios and the Screen Actors Guild, exacerbated the situation as content dried up.

As cinemas opened after COVID, there were still restrictions

Even after the lockdowns were lifted, many were unwilling to go to the cinema

Now, finally, it appears that the cinema is coming back. The 2025 U.S. box office is forecast to exceed $9 billion, and it's going out with a bang. Five Nights at Freddy's. Avatar, The Housemaid, Sponge Bob, David, Marty Supreme, Anaconda, and Song, Sung Blue head up a stellar holiday marquee. It will be a December to remember.

Now, it's all about content and a steady stream of it

Is the cinema back? It appears that moviegoers are. Now Hollywood needs to continue to supply a steady stream of entertaining content that is best viewed on the 'big' screen.       

By: Jim Lavorato

Superman Endures After 86 Years

There have been 10 Superman movies, the first of which premiered in 1978, starring Steve Reeves. Another, the 11th, is scheduled for release in 2027, entitled 'Man of Tomorrow'. The franchise has generated over $3.8 billion in worldwide revenue.

Superman first appeared in a comic book published in 1939 by Action Comics, and a copy of that comic, 'Superman No 1', just sold for $9.12 million. This comic, discovered in an attic, broke the record for the highest single-comic book sale. 

As you can see from the above photo, the comic was graded a 9.0 out of 10 for an excellent rating by the Certified Guaranty Company, the leading third-party comic grading company.

Although 86 years old, Superman endures.

By: Jim Lavorato

Movie Exhibitors Adamantly Opposed to Netflix/Warners Buyout

 Viewed as their worst enemy, movie exhibitors are strongly opposed to Netflix's purchase of Warner Bros.

Many theatre operators are petitioning the Trump Administration to deny Netflix's bid to usurp Warner Bros., as they depend on the 12-14 films Warner Bros. releases annually, and they see this evaporating.

 Movie operators have valid issues regarding their opposition as the chart below illustrates.

"Hopefully the deal gets killed so Warners can be sold to a better entity," says Chris Randleman, CEO at Flix Brewhouse, a Texas upscale theatre chain. In their defense, Netflix execs stress they plan on releasing films theatrically, and there will be no change to the release window between exhibition and streaming. 

Before COVID, most films had an exclusive theatrical window of 90 days. Now, some films are available to buy or rent within a few weeks of distribution. Exhibitors fear Netflix will shorten the theatrical release window even further.

"Shorter windows would result in lower revenues for cinemas," states Eduardo Acuna, CEO of Regal Entertainment. "These lower revenues will result in cinema closings, which limit the consumer's ability to view movies the way filmmakers intended - on a big screen with great surround sound." 

By: Jim Lavorato

Entertainment Industry Gets Cheesy

 

Parmigiano Reggiano, the king of cheeses, seeks product placement

In a deal between the Italian Parmigiano Reggiano Consortium and the United Talent Agency, a firm specializing in cultural marketing, UTA will endeavor to get the king of cheeses prominently displayed in movies, TV shows, and streaming media globally. 

According to a UTA spokesperson, "We will leverage our expertise and global connections across entertainment and culture to introduce Parmigiano to a wide pool of partners, to further its message that the king of cheeses offers gastronomical excellence and high-quality ingredients, production, and distribution."

Parmigiano, as it is familiarly called, has been produced in Italy for over a thousand years. It has a Protected Designation of Origin rating, meaning it can only be produced in one of five Italian provinces, and only under strict rules regarding ingredients and manufacture. 

Product placement can be important for the right product, and Parmigiano is positioned to find placement in a wide range of potential projects.

"This cheese is not just a symbol of excellence but a global brand", says Carmine Forbuso, head of marketing for the Consortium. "This partnership with UTA will allow us to connect with new audiences in an authentic and relevant way."

By: Jim Lavorato

Saudis Invest $900 million in Hollywood AI Developer

 The Crown Prince and Prime Minister of Saudi Arabia announced that the Saudi government will invest $900 million in Luma AI, a San Francisco-based firm that builds AI models for the entertainment industry.

Prince Mohammed bin Salman & Trump at a recent visit to the White House

Humain, a Saudi investment vehicle, will be the lead contributor to the Luma AI investment. As part of the deal, Luma will open an office in Riyadh and have full access to Saudi-based data centers, which generate 2 gigawatts of computing power, equivalent to the Hoover Dam's maximum output. 

Amit Jain, Luma AI's CEO, stated that "Luma will build AI world models that have many use cases for Hollywood, including the creation of new work, and make our systems available to Hollywood studios." Luma recently opened a training center in Los Angeles that offers AI education to film directors and executives. Saudi Prince Salman indicated that Saudi Arabia wants to become an AI powerhouse, using its access to cheap energy, and become an exporter of computing power. 

On his recent visit to the White House, the Prince met not only with the President but also major tech company executives from Nvidia, Oracle, Amazon, Microsoft, and Elon Musk's Grok AI.

According to Amit Jain, "Luma AI is an exceptional U.S.-based global startup pushing the boundaries of AI systems, which will provide foundational breakthroughs into real products."

By: Jim Lavorato

Netflix to Acquire Warner Bros. Discovery, Maybe

 It is now apparent that Netflix, assuming it obtains regulatory approval, will purchase Warner Bros. for $82.7 billion. 

President Trump and Ted Sarandos of Netflix

This would indicate that the world's largest entertainment streamer (YouTube is the largest media streamer) would now own one of Hollywood's oldest studios.

Ted Sarandos, Netflix Co-CEO, recently met with President Trump for a two-hour lunch, presumably regarding the Warner's purchase. "We're highly confident in the regulatory process", says Sarandos. "This deal is pro-consumer, pro-innovation, pro-worker, pro-creator, and pro-growth. Our plans are to work closely with all the appropriate governments and regulators, but we are really confident that we're going to get all the necessary approvals." 

On the flip side, Hollywood's most powerful media producers are strongly against the Netflix purchase. Unions and guilds representing directors, writers, producers, casting directors, and actors expressed deep concern. A spokesperson for the Writers Guild stated, "This merger must be blocked. It's the world's largest entertainment streamer purchasing a major competitor - isn't this what antitrust laws were designed to prevent?" 

I think the odds favor a purchase, but Netflix may not be the acquirer. The Trump Administration may not want to appear to be anti-Hollywood, or worse, anti-worker, so Netflix's road to success will be rocky 

To make matters more interesting, Paramount launched a hostile bid of $108.4 billion for Warner. Owned by Skydance, which recently acquired Paramount, they have put forth a much higher bid vs. Netflix. Their bid includes funding from Saudi Arabia and Qatar, with loans secured by Bank of America and Citibank. 

Hollywood would much prefer the Paramount purchase, but there is strong support for the Netflix deal by Congressional Democrats, who issued a statement saying, "the Paramount transaction has national security issues because of the reliance on funding from foreign-based financiers." That's a dumb argument. 

I believe the Paramount deal is more favorable to Hollywood, as there would be little conflict with theatrical movie releases and early content streaming.  

According to Polymarket (the world's largest prediction market), Netflix only has a 17% chance of closing the Warner's acquisition. I agree. 

By: Jim Lavorato

This Year's Hot Hollywood Gifts

 What are the glitterati finding under the Christmas tree in 2025? Here's the rundown.

- Channel's "IT" cat-eye sunglasses - $800

- Tiffany 'HardWare' diamond earrings. As worn by Sarah Paulson in "All's Fair" - $19,900

- 'Alice in Wonderland' clutch - $1,841

- Kayne's Sun Valley candle (also Vail and Aspen versions) - $65

- Channel's Palm Beach Pink tortoise top-handle bag - $5,300

- Custom Pet Portraits with turquoise, pink opals, and diamonds. As purchased by

Jennifer Aniston and Taylor Swift - starting at $10,000

- Louboutin's crystal pump, for 'Wicked' lovers - $1,495/pair

- Gucci, made-to-order walnut ping-pong table - $85,000

- Channel's 'Sydney Sweeny' hand-crafted leather boxing gloves - $129

- Fender x Loog's miniature electric Telecaster guitar - $229

- New York City brownstone, fully furnished dollhouse - $1,630

Merry Christmas!  

What Is a Movie Producer?

 Why do movies and TV shows list so many producers, and what is their role? Essentially, it's having some sort of fiduciary role, and nothing to do with the production of the movie.

"Real producers are the middlemen between all of the film's departments, makeup, costume, hair, editing, etc., and the director and writer(s) and their vision, " says Laura Lewis, spokesperson for Producers United - an advocacy group of producers devoted to the sustainability and promotion of 'career producers'. And stop the degradation of career producers and seek fair treatment, wages, and accreditation.

Laura Lewis and Jonathan Wang of Producers United

Producer credits are given to a movie's financiers, actors, talent managers, etc., without any production function. "Career producers are pretty easy to spot. They're paid to produce. Currently, there are so many producers credited, but 'real' producers oversee every part of production, pre-production, post-production, and distribution," says Jonathan Wang of Producers United.

I, and anyone who has endured the pre-credits of a movie, know that Producers United has a valid beef, and they should be given special credit.

By: Jim Lavorato

White House Cinema To Be Rebuilt

 

Current WH Cinema - screen will be enlarged with renovation

The White House cinema, which is used to hold screenings for Presidents, their families, and invited guests, is among the spaces being removed as part of the on-going demolition of the East Wing to make room for the $300 million, 90,000 sq. ft. ballroom project.

But, not to worry, a completely upgraded cinema is being constructed. A WH spokesperson stated, "the  theater will be modernized and renovated with the rest of the East Wing."   

The current cinema has 42 seats. The President or his family members can screen any movie they desire - from current first-runs to classic films. A WH staff member simply calls the Motion Picture Association, which notifies the applicable Hollywood studio to obtain the movie.  

Obamas viewing a 3D film

The $300 million upgrade of the ballroom includes an upgrade to the East Wing, which is being financed by private donors and not by taxpayer dollars. 

The first movie ever screened at the WH was "Birth of a Nation" for Woodrow Wilson.

By: Jim Lavorato

             

Update on Lucas Museum

 As a follow-up to a prior CMG post on the Lucas Museum of Narrative Art, its opening is now set for September 2026.

The Lucas Museum of Narrative Art

Located in LA's Exposition Park, the massive building will have 35 galleries and hold over 40,000 works representing one of the most significant collections in narrative art. 

"Stories are mythology, and when illustrated, they help humans understand the mysteries of life," states George Lucas. The museum will also house the Lucas Archives, containing models, props, concept art, and costumes from Lucas's films. 

With a reported cost of $1 billion, the museum has been more than a decade in the making. Several works are depicted below:

Mars illustration

Rockwell's 'Age of Romance' 

By: Jim Lavorato

Labubu Movie in the Works

 If you don't know what Labubu are, you know now. Labubu are plush, cute/ugly bag charms that are  headed to the silver screen.

Labubu

Sony Pictures bought the film rights to the Chinese Labubu charms, with the aim of making a movie and hopefully developing a franchise. It's too early to tell if the film will be live-action or animated.

Labubu (the plural of Labubu is Labubu) exploded in sales when PopMart, a Hong Kong retailer, started selling 'blind boxes' of the charms - meaning buyers never knew which Labubu they were purchasing until they opened the package. With limited editions, the charms now have a huge secondary market. 

Various Labubu

Labubu is the name of the lead charm. Zimomo, Mlkoko, and Tycoco are Labubu's best friends, and there are lots more.

Toys have been inspiring films, The Lego Movie, and Barbie generated huge box office and also earned several Oscar nominations.

By: Jim Lavorato 

Animal Actors Can't Get Work

 

Several animal actors from the Harry Potter films

Rocco, a Saint Bernard/Boxer who is a celebrated canine movie actor, can't get a gig.

Karin McElhatton, owner of Studio Animal Services, which has provided animals to projects like Ghostbusters, LA Confidential, and CSI-Miami, says, "We fear that real animals will be replaced by generated AI ones in films, TV shows, and commercial ads."

A group of canine actors at Universal

Gone are the days of Lassie and Rin Tin Tin. Even horses, which were and are used in many films and TV Shows, are under threat of AI replacement.     

Coaching on a movie set 

Perhaps real animals do add authenticity, but I feel that  AI-generated animals will be used in all forms of entertainment and promotion.

Antarctica: The New A-Lister Destination

 Traveling to the South Pole is attracting the glitterati. Leaving from the southernmost tip of South America, a group of four A-listers over a 10-day vacation can do it lavishly for about $3.5 million.

The ships they sail on feature veranda suites, heated floors, satellite internet, and gourmet meals.

Ship with helipad for those who want to fly in/out..

 

If this isn't your taste, visitors can fly in private jets from Cape Town, South Africa, to White Descent, a luxury glamping facility not far from the South Pole - the charge is $110,00 per person for a three-day stay.

It's not just the Hollywood elite who make the journey south, but other well-heeled folks. The continent had 107,000 visitors last year. "The traveler base has definitely broadened to include younger professionals and well-off families: says Alex Ros, owner of Antarctica-based Open Sky Expeditions.

Luxury accommodations at the South Pole

Telling your friends and family about a trip to the South Pole makes for far more excitement than a visit to a Mediterranean beach. For the Hollywood set and wealthy travelers, the appeal of going to the bottom of the earth is a rare and unusual experience. 

By: Jim Lavorato

Trending With the Hollywood Glitterati is Animal Plastic Surgery

 One of the hottest trends for the Hollywood crowd is cosmetic procedures for pets. Veterinarians have reported a spike in requests for eye lifts to tummy tucks for man's best friend.

In Los Angeles, where image is everything and a bulldog can have an Instagram page that generates more income than its owner earns, pets must look purr-fect.

Pet surgeries fall into two categories: corrective (eyelid lifts for vision problems) and aesthetic (tightening of wrinkles and tummy tucks). Animal dental specialists do canine braces and veneers.

According to Django Mantel, an oral surgeon at NYC's Animal Medical Center, "only a tiny number of dogs get braces for cosmetic reasons, but it is getting more prevalent. The majority of braces are animals who have genetic issues or are from accidents."

And so it goes.

By: Jim Lavorato

Visiting Hollywood Has Vanished

 

Warner Bros. Tower - A Symbol of Old Hollywood 

Once filled with tourists on tour buses to view the homes of the glitterati or stroll down the Walk of Fame, Hollywood now attracts a trickle of visitors.

The glamor has left Hollywood. Most movie stars, back in the day, lived in the Hollywood Hills; now they are dispersed, and many live outside of California altogether. Younger visitors struggle to identify the names on the Walk of Fame, and there are no notable anchor sites of real interest. 

According to Hollywood Partnership, a non-profit dedicated to the economic viability of greater Hollywood, "foot traffic is down 50% since last year due to a neglected neighborhood, which is dirty and uncomfortable for tourists. Additionally, there is really nothing to see or do. The neighborhood is no longer the center of film and TV production, and LA is no longer where many people in the film industry live."  

Some argue that Hollywood needs redevelopment, while others contend that as production jobs leave and people's interests shift, reviving the past will not be effective - there's really nothing to develop.

Once the epicenter of global media production, the Hollywood of the past has disappeared. However, it is also the creator of the sequel, and we might see this materialize with the revitalization of  LA's hosting of the Olympics.

By: Jim Lavorato

Gambling: A Cinema Competitor

 One of the competitors to the movies is gambling. You may think this is laughable - it's not.

Per the American Gaming Association, legal U.S. sports betting posted a record $13.8 billion last year - overall betting topped $150 billion.

Disney's ESPN, the world's largest sports broadcaster, recently inked a deal with DraftKings, a live betting and sports book company which represents all major sports franchises, making DraftKings the "exclusive official sports book and odds provider to ESPN." ESPN BET will be the brand and will be aired via a new televised  show entitled "ESPN Bet Live."

Under the agreement, ESPN users will have access to betting features and offerings from DraftKings, including:  sportsbook, fantasy games, and other betting platforms. DraftKings operates online with over 10 million customers. It also runs restaurant-betting sites where customers can bet, watch games and events, eat and drink, and linger for hours.

Gambling is big and getting bigger, and although not directly related to the movies it does provide an alternative destination in and outside the home.

By: Jim Lavorato

What Are People Watching: The New Trend in Entertainment

 

While the movie box office remains stagnant, traditional TV and streaming viewing are decreasing among younger viewers. 42% of Gen Z respondents stated that YouTube and other social media outlets, such as TikTok, are preferred over traditional TV or streaming platforms.

According to Activate Consulting's new study, Technology & Media Outlook 2026, 42% of Gen Z are opting to receive their entertainment and news reporting from YouTube and TikTok.

Microdramas are one of the fastest-growing trends in viewing. These are typically 1-2 minute scripted ongoing stories of 50 or more episodes. Each episode ends with a cliffhanger to keep viewers engaged. There are currently 28 million adults (aged 18-34) viewing microdramas daily in the U.S.

By: Jim Lavorato