Some pay services are about to get a big bump in business for content already created if this shit ain't settled
Picket signs made by WGA East members
Hollywood has been a union town for close to 100 years. In that time, there have been a little over a dozen major labor strikes, the last being the 2007-08 Writers Guild of America work stoppage, which lasted 14 weeks and had a profound impact on the industry.
The current looming strike by the WGA could start as soon as midnight PT Tuesday, when the current WGA contract with the Association of Motion Picture and Television Producers expires.
Below is a primer covering the issues, the parties involved and what’s at stake for the entire industry during a work stoppage.
Deadline: 11:59 p.m., May 1
At Issue: Compensation for writers in a changing media landscape
Jobs At Stake: 822,000 direct employees; 2.4M total supported in 2021
Industry Wages: $81B direct; $186B total supported
The Market: $261B in sales
WGA Membership: ~20,000
AMPTP Membership: 350-plus TV and film production companies
On the other, is the Writer’s Guild of America, which represents writers in Hollywood who are members, which most working scribes are. Supporting the WGA are many of the other powerful guilds and unions, including the Screen Actor’s Guild (SAG-AFTRA), the Director’s Guild of America (DGA)
“Driven in large part by the shift to streaming, writers are finding their work devalued in every part of the business. While company profits have remained high and spending on content has grown, writers are falling behind,” the WGA said in a statement. “The companies have used the transition to streaming to cut writer pay and separate writing from production, worsening working conditions for series writers at all levels. “
There is also the potentially-transformative impact of AI, and how it could be used to generate scripts.
The AMPTP, for its part, is taking a conservative financial approach representing the interests of its members with an eye to their bottom lines and stock prices. AMPTP President Carol Lombardini is widely seen as a tough but fair negotiator. She wants the best for her side, and that’s a deal that sees production continue to flow and flourish and helps studios and streamers keep their costs under control.
“The entertainment segments of the industry’s major companies — Netflix, Paramount Global, Warner Bros. Discovery, Fox, Disney, and Comcast NBCUniversal — posted an average $29 billion in annual operating income between 2017 and 2021,” it said in a recent report. “Legacy media companies’ profits in 2022 were lower, but the companies expect improvement in the near term as they build towards increased profitability in streaming.”
The guild also wants to establish some sort of policy on AI and authorship, especially if a writer’s ideas are used as the basis for AI-generated work.
“The WGA’s proposal to regulate use of material produced using artificial intelligence or similar technologies ensures the Companies can’t use AI to undermine writers’ working standards, including compensation, residuals, separated rights and credits,” it noted.
For a detailed list of the WGA’s specific goals see its Pattern of Demands, listed here.
One line of argument from producers says that streaming is still an emerging business and studios and networks don’t exactly know what profit margins will look like (or even how they will be achieved). But Netflix co-CEO Ted Sarandos recently estimated his company’s expected content spend for 2024 at $17 billion and reported Q1 free cash flow that zoomed to $2.1 billion compared with $800 million in the year-ago quarter. That’s a pretty healthy “emerging” business.
Officially, the AMPTP has been more vague about its goals, beyond the desire to see production continue. One recent statement from the group read, “We are all partners in charting the future of our business together and fully committed to reaching a mutually beneficial deal with each of our bargaining partners. The goal is to keep production active so that all of us can continue working and continue to deliver to consumers the best entertainment product available in the world.”
Net to be impacted would be Daytime TV — especially soap operas, which generally have an ongoing production schedule.
Saturday Night Live also would be affected with respect to its last three shows of the season if a strike goes ahead. This would impact the Pete Davidson-hosted show on May 6 as well as the season finale, where traditionally castmembers who are leaving get to say their big goodbye.
At some point, even hit episodic shows could be impacted. Per a recent WGA report, “a work stoppage in May could delay the network television season, which continues to account for one third of all episodes produced, including 45% of the episodes produced by legacy media companies Disney, Paramount Global, and Comcast NBCUniversal. Writers on fall network series typically begin work in May and June in preparation for series premieres inSeptember and October. Writing for numerous streaming series is also ongoing or is anticipated to begin in the coming months. Any delay in the start of work has the potential to postpone fall season premieres and could ultimately reduce the amount of new programming produced for
the 2023-2024 network season.”
When that blow fell in the 2007-2008 strike, networks leaned into a then relatively-nascent genre of programming: unscripted. What resulted was an explosion of reality TV and new formats, many of which are still with us today.
In a worst-case scenario, the theatrical release calendar would see several date changes for pics, some as soon as Q4 this year. While the 2024 theatrical release calendar remains roughly intact in its first six months with completed movies coming down the pipeline, beyond that gets squishy; It’s in this scenario that studios might need to pull from Q4 2023 into 2024.
A delay in production could potentially cause another post-production logjam, which was one of the knock-on effects of postponements during the pandemic. That left the late August-October 2022 box office and winter this year a dry bed for product. In fact, we’re still waiting on movies delayed by the pandemic to hit theaters. Warner Bros/DC’s The Flash, which got its first screening at CinemaCon on Tuesday night, and Aquaman and the Lost Kingdom, set for December 20, were two such titles.
Studio and distribution marketing chiefs remain in wait-and-see mode regarding blockbusters, but smaller movies that are publicity-dependent are prime to pivot should SAG-AFTRA strike.
One upcoming feature production that is safeguarding itself from a lengthy WGA strike is James Gunn’s Superman: Legacy, which is planning an early 2024 start for a July 11, 2025 theatrical release. Gunn showed off a cover of the screenplay on social media and announced the start of pre-production earlier this week, with “costumes, production design, and more now up and running.”
How Long Could It Last?
The longest WGA strike on record was 1988, lasting 153 days, followed by the 1960 strike at 146 days, and then the 2007-08 strike at 100 days. There seems to be more support for a strike this time around.
Back in 2017 – the last time a strike authorization was taken – it was approved by 96.3% of the 6,310 writers who cast ballots, with a record 67.5% turnout of eligible WGA members. In 2007, the authorization vote was approved by 90% of voters. The strike authorization this time around was approved by nearly 98% of the eligible voting members.
It’s Not Just The WGA
A number of unions have contracts with the AMPTP expiring in the next few weeks. Generally, the guild that negotiates first sets the tone for the subsequent negotiations. The DGA has gone first at the bargaining table in each of the past three bargaining cycles. The last time the WGA went first — back in 2007 — resulted in a 100-day writers strike.
The powerful DGA begins negotiations for its 19,000 members on May 10. Its contract expires June 30.
SAG-AFTRA begins negotiations with the AMPTP on June 7. Its contract with the AMPTP expires on June 30. Should SAG-AFTRA strike, it would prevent actors from doing publicity on their feature or TV projects, which would have very powerful knock-on effects.
In addition, unions and guilds have come out publicly in support of the WGA, including SAG-AFTRA, the Directors Guild, IATSE, Hollywood’s Teamsters Local 399 and the American Federation of Musicians and the UK Writer’s Guild.
“These multibillion-dollar corporations – including Amazon, Netflix, Disney, and Apple – invest in highly paid executives and lavish productions,” Teamsters Local 399 brass said in a statement. “They can afford to share the wealth with the writers who create the content we all watch. We are monitoring negotiations closely. This is a shared fight and Teamsters do not cross picket lines.”
Concern about looming labor unrest and uncertainty surrounding pending corporate restructuring have contributed to a 35.8% plunge in on-location TV production in Los Angeles in the first quarter of 2023 compared with the same period last year.
According to the Motion Picture Association — whose members include Netflix, Paramount, Sony Pictures Entertainment, Universal, Disney and Warner Bros. — 2.4 million people work in jobs supported by the industry, which pays over $186 billion in wages annually. And it’s not just in L.A.
The entertainment industry pays out $21 billion per year to more than 260,000 businesses in cities and small towns across the country, per the MPA. It accounts for $14.4 billion in exports and $7 billion in trade surplus for the U.S.
The big win for the Writers Guild was some jurisdiction over new media, which was precedent-setting. Streamers would have to hire WGA writers on shows over certain budgets. Other than that, writers received a new percentage payment on the distributor’s gross for digital distribution. But it came at a cost.
The AMPTP estimated that WGA writers and IATSE union members lost $342.8 million in wages in the 2007-2008 work stoppage. The New York Times reported that the overall hit to the Los Angeles economy was $2.1 billion, including an $830 million bite out of statewide retail sales as entertainment workers trimmed spending.
The “Big Four” networks — CBS, ABC, NBC, and FOX — suffered, too. NBC had the most severe ad shortfall with its prime time ratings declining sharply. None of its new shows achieved breakout success. Moreover, during 2007, NBC saw its prime time 18-to-49-year-old viewership drop by 11%. CBS dropped the same demographic by 10%, and ABC lost 5%, according to Crain’s New York Business.
A white paper released by Nielsen Media Research indicated that TV viewers spent more time with alternative forms of entertainment outside of broadcast television, a trend that may accelerate this time around given the massively-increased prevalence of social media, chat and short-video consumption since then.
One SNL source told Deadline that during the 2007-08 strike there was a real question whether the venerable NBC show would ever come back. “It was especially heartbreaking because the show was in really great place then. But at the same time, it was absolutely right. There’s no way to do SNL during a writers strike.”
deadline.com
Hollywood has been a union town for close to 100 years. In that time, there have been a little over a dozen major labor strikes, the last being the 2007-08 Writers Guild of America work stoppage, which lasted 14 weeks and had a profound impact on the industry.
The current looming strike by the WGA could start as soon as midnight PT Tuesday, when the current WGA contract with the Association of Motion Picture and Television Producers expires.
Below is a primer covering the issues, the parties involved and what’s at stake for the entire industry during a work stoppage.
Deadline: 11:59 p.m., May 1
At Issue: Compensation for writers in a changing media landscape
Jobs At Stake: 822,000 direct employees; 2.4M total supported in 2021
Industry Wages: $81B direct; $186B total supported
The Market: $261B in sales
WGA Membership: ~20,000
AMPTP Membership: 350-plus TV and film production companies
The Two Sides
On one side are the Hollywood studios, networks, streamers and hundreds of other motion picture and TV producers which make and/or distribute most content. They are represented in the talks by the Association of Motion Picture and Television Producers.On the other, is the Writer’s Guild of America, which represents writers in Hollywood who are members, which most working scribes are. Supporting the WGA are many of the other powerful guilds and unions, including the Screen Actor’s Guild (SAG-AFTRA), the Director’s Guild of America (DGA)
What’s at Issue?
“The survival of writing as a profession is at stake in this negotiation,” the WGA said at the outset, noting that many members who previously made a good living are finding it much harder to do so these days.“Driven in large part by the shift to streaming, writers are finding their work devalued in every part of the business. While company profits have remained high and spending on content has grown, writers are falling behind,” the WGA said in a statement. “The companies have used the transition to streaming to cut writer pay and separate writing from production, worsening working conditions for series writers at all levels. “
There is also the potentially-transformative impact of AI, and how it could be used to generate scripts.
The AMPTP, for its part, is taking a conservative financial approach representing the interests of its members with an eye to their bottom lines and stock prices. AMPTP President Carol Lombardini is widely seen as a tough but fair negotiator. She wants the best for her side, and that’s a deal that sees production continue to flow and flourish and helps studios and streamers keep their costs under control.
What’s at Stake?
Hollywood is just emerging from the impacts of Covid and the related production slowdowns. More recently, studios, networks, streamers and producers have laid off thousands of workers. For an industry that a year ago was collectively questioning its own future, a strike-related work stoppage after layoffs and Covid-related shutdowns could prove a staggering three-punch combination.What Do Writers Want?
Specifically, with the current strike, the WGA seeks gains in compensation and residuals, and curbs on mini-rooms, where groups of writers work in advance of the production of a television series to break stories and write scripts. The guild has argued that the producers are well able to compensate writers more fairly.“The entertainment segments of the industry’s major companies — Netflix, Paramount Global, Warner Bros. Discovery, Fox, Disney, and Comcast NBCUniversal — posted an average $29 billion in annual operating income between 2017 and 2021,” it said in a recent report. “Legacy media companies’ profits in 2022 were lower, but the companies expect improvement in the near term as they build towards increased profitability in streaming.”
The guild also wants to establish some sort of policy on AI and authorship, especially if a writer’s ideas are used as the basis for AI-generated work.
“The WGA’s proposal to regulate use of material produced using artificial intelligence or similar technologies ensures the Companies can’t use AI to undermine writers’ working standards, including compensation, residuals, separated rights and credits,” it noted.
For a detailed list of the WGA’s specific goals see its Pattern of Demands, listed here.
What Do Studios, Networks & Streamers Want?
Quite simply, they want to make sure that they can keep making a profit.One line of argument from producers says that streaming is still an emerging business and studios and networks don’t exactly know what profit margins will look like (or even how they will be achieved). But Netflix co-CEO Ted Sarandos recently estimated his company’s expected content spend for 2024 at $17 billion and reported Q1 free cash flow that zoomed to $2.1 billion compared with $800 million in the year-ago quarter. That’s a pretty healthy “emerging” business.
Officially, the AMPTP has been more vague about its goals, beyond the desire to see production continue. One recent statement from the group read, “We are all partners in charting the future of our business together and fully committed to reaching a mutually beneficial deal with each of our bargaining partners. The goal is to keep production active so that all of us can continue working and continue to deliver to consumers the best entertainment product available in the world.”
What TV Shows Would Be Affected?
Late-night shows likely would be first hit, given their nightly schedules and topical nature. During the 2007-08 strike, all the late-night talkers began airing reruns on Day 1.Net to be impacted would be Daytime TV — especially soap operas, which generally have an ongoing production schedule.
Saturday Night Live also would be affected with respect to its last three shows of the season if a strike goes ahead. This would impact the Pete Davidson-hosted show on May 6 as well as the season finale, where traditionally castmembers who are leaving get to say their big goodbye.
At some point, even hit episodic shows could be impacted. Per a recent WGA report, “a work stoppage in May could delay the network television season, which continues to account for one third of all episodes produced, including 45% of the episodes produced by legacy media companies Disney, Paramount Global, and Comcast NBCUniversal. Writers on fall network series typically begin work in May and June in preparation for series premieres inSeptember and October. Writing for numerous streaming series is also ongoing or is anticipated to begin in the coming months. Any delay in the start of work has the potential to postpone fall season premieres and could ultimately reduce the amount of new programming produced for
the 2023-2024 network season.”
When that blow fell in the 2007-2008 strike, networks leaned into a then relatively-nascent genre of programming: unscripted. What resulted was an explosion of reality TV and new formats, many of which are still with us today.
In a worst-case scenario, the theatrical release calendar would see several date changes for pics, some as soon as Q4 this year. While the 2024 theatrical release calendar remains roughly intact in its first six months with completed movies coming down the pipeline, beyond that gets squishy; It’s in this scenario that studios might need to pull from Q4 2023 into 2024.
A delay in production could potentially cause another post-production logjam, which was one of the knock-on effects of postponements during the pandemic. That left the late August-October 2022 box office and winter this year a dry bed for product. In fact, we’re still waiting on movies delayed by the pandemic to hit theaters. Warner Bros/DC’s The Flash, which got its first screening at CinemaCon on Tuesday night, and Aquaman and the Lost Kingdom, set for December 20, were two such titles.
Studio and distribution marketing chiefs remain in wait-and-see mode regarding blockbusters, but smaller movies that are publicity-dependent are prime to pivot should SAG-AFTRA strike.
One upcoming feature production that is safeguarding itself from a lengthy WGA strike is James Gunn’s Superman: Legacy, which is planning an early 2024 start for a July 11, 2025 theatrical release. Gunn showed off a cover of the screenplay on social media and announced the start of pre-production earlier this week, with “costumes, production design, and more now up and running.”
How Long Could It Last?
The longest WGA strike on record was 1988, lasting 153 days, followed by the 1960 strike at 146 days, and then the 2007-08 strike at 100 days. There seems to be more support for a strike this time around.
Back in 2017 – the last time a strike authorization was taken – it was approved by 96.3% of the 6,310 writers who cast ballots, with a record 67.5% turnout of eligible WGA members. In 2007, the authorization vote was approved by 90% of voters. The strike authorization this time around was approved by nearly 98% of the eligible voting members.
It’s Not Just The WGA
A number of unions have contracts with the AMPTP expiring in the next few weeks. Generally, the guild that negotiates first sets the tone for the subsequent negotiations. The DGA has gone first at the bargaining table in each of the past three bargaining cycles. The last time the WGA went first — back in 2007 — resulted in a 100-day writers strike.
The powerful DGA begins negotiations for its 19,000 members on May 10. Its contract expires June 30.
SAG-AFTRA begins negotiations with the AMPTP on June 7. Its contract with the AMPTP expires on June 30. Should SAG-AFTRA strike, it would prevent actors from doing publicity on their feature or TV projects, which would have very powerful knock-on effects.
In addition, unions and guilds have come out publicly in support of the WGA, including SAG-AFTRA, the Directors Guild, IATSE, Hollywood’s Teamsters Local 399 and the American Federation of Musicians and the UK Writer’s Guild.
“These multibillion-dollar corporations – including Amazon, Netflix, Disney, and Apple – invest in highly paid executives and lavish productions,” Teamsters Local 399 brass said in a statement. “They can afford to share the wealth with the writers who create the content we all watch. We are monitoring negotiations closely. This is a shared fight and Teamsters do not cross picket lines.”
Concern about looming labor unrest and uncertainty surrounding pending corporate restructuring have contributed to a 35.8% plunge in on-location TV production in Los Angeles in the first quarter of 2023 compared with the same period last year.
According to the Motion Picture Association — whose members include Netflix, Paramount, Sony Pictures Entertainment, Universal, Disney and Warner Bros. — 2.4 million people work in jobs supported by the industry, which pays over $186 billion in wages annually. And it’s not just in L.A.
The entertainment industry pays out $21 billion per year to more than 260,000 businesses in cities and small towns across the country, per the MPA. It accounts for $14.4 billion in exports and $7 billion in trade surplus for the U.S.
The big win for the Writers Guild was some jurisdiction over new media, which was precedent-setting. Streamers would have to hire WGA writers on shows over certain budgets. Other than that, writers received a new percentage payment on the distributor’s gross for digital distribution. But it came at a cost.
The AMPTP estimated that WGA writers and IATSE union members lost $342.8 million in wages in the 2007-2008 work stoppage. The New York Times reported that the overall hit to the Los Angeles economy was $2.1 billion, including an $830 million bite out of statewide retail sales as entertainment workers trimmed spending.
The “Big Four” networks — CBS, ABC, NBC, and FOX — suffered, too. NBC had the most severe ad shortfall with its prime time ratings declining sharply. None of its new shows achieved breakout success. Moreover, during 2007, NBC saw its prime time 18-to-49-year-old viewership drop by 11%. CBS dropped the same demographic by 10%, and ABC lost 5%, according to Crain’s New York Business.
A white paper released by Nielsen Media Research indicated that TV viewers spent more time with alternative forms of entertainment outside of broadcast television, a trend that may accelerate this time around given the massively-increased prevalence of social media, chat and short-video consumption since then.
One SNL source told Deadline that during the 2007-08 strike there was a real question whether the venerable NBC show would ever come back. “It was especially heartbreaking because the show was in really great place then. But at the same time, it was absolutely right. There’s no way to do SNL during a writers strike.”
WGA Strike Explained: The Issues, The Stakes, Movies & TV Shows Affected — And How Long The 2023 Work Stoppage Might Last
The 2023 Hollywood writers strike revolves around the issues of compensation for streaming and the potential use of AI in creating film and TV.
deadline.com
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