Change is the new constant in the media and entertainment industry, as the fundamental nature of competition in the industry has shifted. No longer do television shows merely compete with television shows, theatrical releases with theatrical releases, video games with video games, etc. With more content now available than any of us can consume in a lifetime, all content and content offers are competing with each other in real time for a precious slice of each consumer’s time.

In this era of hyper competition and digital connectedness, a new business model is emerging, one powered by data, with the consumer firmly at its center. Data has become M&E’s secret weapon for sustaining and improving consumer engagement and satisfaction. It’s data that can reconcile a world of ubiquitous distribution with a consumer’s finite amount of time to consume content. And it’s just getting started: By 2020, data scientists estimate that for every human on the planet, there will be 1.7 MB of data being produced. Every second.

Leveraging that data is essential as M&E companies compete for consumers’ time, advocacy and money across multiple platforms. Those that know consumers best will win.

Enter cognitive computing, which has the ability to examine the choices consumers are making, and under what circumstances, in order to understand and predict what consumers will want next. Although some pundits have framed artificial intelligence and machine learning as a person-versus-machine comparison, at IBM we view the most productive implementation of AI as a symbiosis of person and machine.

Computers are good at rapidly processing enormous amounts of data and looking for hidden patterns and valuable attributes. The human brain is highly adept at other skills, such as generalization and abstraction. Together these make up Augmented Intelligence and the possibility of better decision making in all functions of business, from production and distribution to sales and marketing.

Two core domains are driving the application of machine learning. One is “audience” (customer or consumer) insight -- reaching a new level of personalization by understanding their affinities, traits, likes, dislikes, and how they respond to media. The other is “content” insight -- the enrichment of metadata and understanding what’s in the content to exploit it in new ways, in new formats and across new channels of distribution. Combine these, and M&E companies can apply cognitive insights to improve KPIs, including ad sales, content ultimates, productivity and efficiency, and margin growth.

Consider the ongoing Major League Baseball season. Using cognitive technology, media companies can now take baseball-related video content and better understand it in terms of sentiment -- including a closer look at actions that may indicate crowd excitement, or tuning in to crowd noise and the tone of the sportscaster’s commentary to gauge key moments -- and surface it to fans for a more personalized viewing experience.

Cognitive computing is a natural enhancement to existing business practices that will make day-to-day operations more effective while helping media companies create a better consumer/user experience. AI is a positive disruption, one that demonstrates the art of the possible. Most importantly, it’s an opportunity to thrive in an age of constant change -- the firms that are better equipped to extract insights from data are the likely winners.

Steve Canepa is general manager, global telecommunications, media & entertainment industry, at IBM. Image by John Lund/Getty Images.

Merger and acquisition activity in the entertainment, media and telecommunications industry rose in the second quarter from a year ago, although the value of those deals dropped slightly, according to PwC.

The quarter saw 232 deals, up from 216 deals a year ago but down from the first quarter's 255 deals.

Related: Viacom Pulls Out of Bidding for Scripps Networks

The deals announced in the second quarter were worth $18.8 billion, down from total deal value of $21.3 billion in Q2 2016. In the first quarter, mergers and acquisitions were worth $10.4 billion.

Big deals in Q2 included Sinclair Broadcasting Group’s $3.8 billion bid to acquire Tribune Media, RCN’s $2.4B merger with WaveDivision Holdings and Verizon’s acquisition of Straight Path Communications, worth $2.3 billion.

“Deal activity in 2017 continues to outpace 2016 as market participants look to secure their footing in the digital value chain and position themselves in anticipation of regulatory change,” said Bart Spiegel, partner, media and telecommunications deals.

Read more at broadcastingcable.com.

Total deal value in the U.S. Entertainment, Media & Communications (EMC) sector was up 13% to $149 billion in 2015, a 13% increase led mostly by cable transactions, and the pace is expected to continue in the current year, according to a report by research gamt PricewaterhouseCoopers.

While total deal volume was down about 7% in 2015 – to 818 announced deals from 886 in 2014 – the size of each deal was bigger, according to PwC’s U.S. Entertainment, Media & Communications (EMC) Deal Insights. Cable deals provided the bulk of 2015 deal value, while advertising and marketing goosed it. And though Q4 was one of the slowest merger-and-acquisition  quarters in recent history, PwC said it believes momentum is strong for the future.

Two megadeals – Charter’s pending purchases of Time Warner Cable ($56 billion, minus debt) and Bright House Networks ($11 billion) – accounted for 45% ($67 billion) of the total deal value for the year. And though there was a slowdown in the second half of the year, PwC said it could be attributed to an overall wait-and-see approach, as previously announced deals await regulatory approval; tightened access to debt markets; overall uncertainty around the broader macroeconomic environment; and resolution on industry-specific activities, such as spectrum auctions.

Here’s what PwC believes is in store for the markets in 2016:

Advertising & Marketing: Year-over-year deal volume within advertising and marketing increased more than any other EMC sub-sector, as underlying fundamentals in this space remained strong. However, despite a 13% increase in 2015 deal volume, there was a steep decline in deal values, down $9.7 billion from $12.3 billion in 2014 to $2.7 billion in 2015. Given the continued shift to digital and the insatiable appetite to consume content across multiple devices, those with engaging mobile and social advertising solutions are proving to be attractive acquisition targets.

Broadcasting: Deal volumes in the broadcasting sector declined for another year, down 42% in 2015 compared to 2014, following mass consolidation in the local television broadcasting space in 2013 and part of 2014. In 2015, there were only two large TV broadcasting groups making multiple acquisitions during the period, compared to six players in the prior year. Despite a decline in deal activity, deal values were up from $4 billion in 2014 to $5.4 billion, driven primarily by Nexstar’s bid for Media General for $4.6B.

While some baseline activity level is expected to continue (like Sinclair’s purchase of the Tennis Channel for $350 million in January 2016), PwC doesn’t expect significant deal volumes in this sector in the coming year due to the recent consolidation in this sub-sector over the last several years and  FCC ownership limits. Any activity will likely be driven by individual or small groups of owned-and-operated television stations The one unknown is what broadcasters  will do with capital raised from the sale of spectrum in the upcoming FCC auctions.

Cable: After a headline-making first half, deal activity within the cable sector slowed significantly in the second half of 2015. Absent the megadeals, the sector had a quiet year, which may be attributed to cable companies waiting to see if certain 2015 transactions meet regulatory approval. If approved, this could send a signal to the market that further consolidation would be necessary to maintain a competitive marketplace. PwC expects additional M&A as mid-tier cable players look to expand their footprint in adjacent geographies, taking advantage of potential synergies.

Communications: Despite a 10% decline in communications deal volume, deal value increased by 38% to $22.2 billion in 2015. The path forward centers around two very pressing topics: distribution and content. The level of 2016 deal activity may be somewhat dependent on the outcome of industry-wide events, such as the next round of spectrum auctions scheduled to commence in March 2016. PwC believes those companies whose service offerings improve the operating efficiency and capabilities of the underlying network will remain attractive M&A targets.