Open to AI: Hollywood Is Embracing Artificial Intelligence Tools Despite Doomsday Fears

Manhattan Beach Studios in Southern California is a pinnacle of revolutionary technology, home to both the “volume” screens where Jon Favreau filmed the “Mandalorian” franchise and Lightstorm Entertainment, where James Cameron has spent years bringing the Na’vi to life.

Tucked away at Stage 21 lies Innovative Dreams, an AI offshoot of director Jon Erwin’s Entertainment company Wonder Project. Here, chief operating officer Bryan Yee sips from a Diet Coke can as he showcases the soundstage housing Innovative Dreams’ crown jewel: a collection of LED screens where a team of AI artists weaves generative AI into productions. It’s not the first time the space has been shown to a journalist. But that it’s happened multiple times this year shows that three-quarters of the way into 2026, AI is no longer Hollywood’s ultimate bad word.

The term “AI” has emerged as an addendum to the Hays Code, the 20th-century guidelines dictating what studios should and shouldn’t include in their films. It’s spooked the worlds of corporate and art alike, especially after months of headlines over the potentially world-ending nature of AI models and warnings that progress needs to be paced. Americans are also increasingly believing the tech is doing more harm than good, according to a recent Gallup poll.