Lionsgate Moves Beyond AI Tools and Bets on AI-Generated Franchises

By taking an equity stake in Runway and launching a joint development program, Lionsgate is signaling that generative AI is no longer just a production tool—it is becoming part of the studio's long-term business strategy.

ajay_suresh, CC BY 2.0 <https://creativecommons.org/licenses/by/2.0>, via Wikimedia Commons

For nearly two years, Lionsgate has positioned itself as Hollywood's most aggressive adopter of artificial intelligence. The studio became the first major entertainment company to partner with Runway in 2024, initially focusing on using generative AI to support pre-production tasks such as storyboarding, previsualization and post-production workflows. This month, however, the relationship entered a new phase.

On June 11, Lionsgate and Runway announced a significant expansion of their partnership. Under the new agreement, Lionsgate has taken an undisclosed equity stake in the AI company, while the two firms will launch a joint development program to create new intellectual property together. Their first project will be a short-form episodic series that combines Lionsgate's existing library with Runway's generative AI models.

The announcement represents one of the clearest signals yet that a major Hollywood studio no longer views AI simply as a way to streamline production. Instead, Lionsgate is treating the technology as a long-term investment capable of generating entirely new entertainment businesses.

The expansion builds on a relationship that has already distinguished Lionsgate from many of its competitors. While other studios have experimented cautiously with AI behind the scenes, Lionsgate has publicly embraced the technology. The company was the first major studio to appoint a Chief AI Officer, Kathleen Grace, and established an internal AI Steering Committee to oversee how generative tools are introduced across its operations. According to the company, Runway's software is already being used by filmmakers throughout pre-production, storyboarding and final-frame visual work.

The new agreement goes considerably further.

Rather than licensing software from a technology vendor, Lionsgate is becoming an investor in one. Financial terms of the equity investment were not disclosed, but the strategic implications are clear. By owning part of Runway, Lionsgate gains a closer role in shaping the evolution of tools that could eventually become standard throughout film and television production. At the same time, Runway secures one of Hollywood's largest content partners as it competes with companies including OpenAI, Google DeepMind and Adobe to become the industry's preferred AI platform.

The move also reflects how quickly Hollywood's AI conversation has evolved. Much of the industry's public debate since 2023 has centered on protecting creative workers from automation and ensuring that copyrighted material is not used without permission. Lionsgate's announcement suggests that some studios are now looking beyond those initial questions and focusing instead on how AI can generate entirely new revenue streams.

Notably, the companies are not limiting the partnership to internal production efficiencies. Their joint development program is intended to create original entertainment properties alongside AI-assisted projects built from Lionsgate's existing intellectual property. Although neither company has disclosed which franchises will be involved, Lionsgate controls a library of more than 20,000 film and television titles, including globally recognized brands such as John Wick, The Hunger Games and Saw.

That scale matters. AI has often been discussed as a tool for reducing costs, but valuable intellectual property remains the foundation of Hollywood's economics. If studios can use generative AI to extend established franchises into new formats without sacrificing quality or brand integrity, the commercial opportunity could extend well beyond production savings.

Executives from both companies have been careful to frame the partnership in creative rather than purely financial terms. Lionsgate Vice Chairman Michael Burns described Runway as "a great creative partner," while Runway co-founder and CEO Cristóbal Valenzuela argued that studios embracing AI should think of it as "a creative resource, not a cost-cutting tool."

Whether audiences ultimately embrace AI-assisted entertainment remains an open question. But from a business perspective, Lionsgate has already made its position clear.

The studio is no longer experimenting with artificial intelligence.

It is investing in it.