When CMOs pay for agents not agencies: S4 Capital's AI gambit

"S4 Capital has dropped the pretense. The company's top brass are now openly framing AI agents not as enhancement to agency work, but as the replacement. In their view, the traditional agency model isn't evolving - it's being automated out. And that automation is already reshaping how ads get made. Clients like Google are now paying S4 for what its AI agents can deliver, not its people. Take a recent Pixel smartphone campaign. AI handled nearly every part of the production pipeline: scriptwriting, storyboarding, even directorial decisions."

"Pre-production, production, post - all generated by agents. What would've taken months with a traditional team was compressed into weeks. "We personally estimate about 65% of the tasks agencies get paid for currently could be done by AI agents with today's technology," said Wes ter Haar, an executive director of S4 Capital on the earnings call for the group's interim results. It's the quiet part said out loud."

""We're currently in the midst of reshaping our business to be AI-enabled," he told analysts on the call. "The current cost reduction exercise is a part of that approach, and it improves our full strength heading into H2, as well as setting us up well for 2026." How that restructure works at scale remains unclear. But the direction is taking shape: S4 plans to rewire the business around what it calls an "AI workforce", spanning three areas: data-driven strategy, automated content and optimized media."

S4 Capital is replacing traditional agency labor with autonomous AI agents, positioning those agents as the primary creators and sellers of advertising work. A Pixel campaign reportedly used agents for scriptwriting, storyboarding and directing, compressing timelines from months to weeks. An executive estimates roughly 65% of current agency tasks could be automated with existing technology, and leadership is preparing staff reductions and a business reshaping. The firm plans an AI workforce across data-driven strategy, automated content and optimized media, packaged into managed services and consulting to help CMOs transition to recurring, AI-enabled offerings.

Read at Digiday