Hollywood writers’ strike looms as deadline approaches

Published on: 05/01/2023 – 08:06Amended: 05/01/2023 – 08:30

Major studios and networks, including Disney and Netflix, are locked in talks with the powerful Writers Guild of America (WGA), which has threatened to order a walkout just after midnight Tuesday unless a new deal is reached.

If a strike occurs, late-night shows could shut down immediately, and TV series and movies slated for release later this year and beyond could face significant delays.

The last time talks broke down, in 2007, Hollywood writers dropped their pens and keyboards for 100 days, costing the Los Angeles entertainment industry an estimated $2 billion.

This time the two sides clash as writers demand higher salaries and a bigger share of profits from the streaming boom, while studios say they need to cut costs due to economic pressures.

“I think everyone feels like there’s going to be a strike,” said a Los Angeles-based television writer, who asked not to be identified.

“This is an agreement that will determine how we are financially compensated by streamers,” not just now but in the future, they said.

Streaming “residues”

Many of the issues are familiar to contract talks in industries around the world.

The writers say earning a living is becoming impossible as wages have stagnated or fallen after inflation, even as employers reap profits and fatten executive paychecks.

More writers than ever are working for union-mandated minimum wages, while shows are hiring fewer people to script ever-shorter series.

A key issue is reworking the formula that calculates how writers get paid for streaming shows, which often stay on platforms like Netflix years after they’re written.

For decades, writers have been paid “waste” from the reuse of their material, such as TV reruns or DVD sales.

This is either a percentage of studio revenue for the movie or show, or a fixed amount each time an episode is replayed.

With streaming, writers simply receive a fixed annual payment — even if their work generates a smash hit like “Bridgerton” or “Stranger Things,” which reaches hundreds of millions of viewers around the world.

“These amounts remain far too low for the global reuse of programming covered by WGA on these massive services,” the guild says.

The WGA is committed to “enhancing these residues so that writers share in the global success of the programming they create”.

He also wants to address the future impact of artificial intelligence on writing.

‘Disputed’

Unsurprisingly, the studios – represented by the Alliance of Motion Picture and Television Producers (AMPTP) – have a different view.

They note that overall residuals paid out to writers hit an all-time high of $494 million in 2021, thanks in large part to the surge in writing jobs driven by the explosion of streaming content.

That’s up nearly half, from $333 million a decade earlier.

They also take issue with suggestions that studios are falsely citing economic hardship to bolster their negotiating position.

“Do you think Disney would lay off 7,000 people for fun?” said a source familiar with the AMPTP’s position.

“There is only one [streaming] platform that’s profitable right now, and that’s Netflix. The movie industry…it’s also a pretty tough segment.”

After the profligacy of the past few years, when rival streamers chased subscriber growth at all costs, the bosses are now under intense pressure from investors to limit spending and generate profits.

‘Pickets’

As the midnight deadline approaches (07:00 GMT Tuesday), the two sides could strike a last-minute deal, temporarily extend talks or walk away and prepare for picketing.

The industry fears a ripple effect.

Several other Hollywood unions have expressed solidarity with the writers, including the actors’ SAG-AFTRA and the directors’ DGA. The two will hold their own talks with studios this summer.

“The greatest leverage we collectively bring to strike action is the withdrawal of our work,” the WGA wrote to members on Sunday, in a message seen by Variety.

“Picketing is a key tactic to demonstrate that we are all in this together and that until a strike is resolved it is not business as usual.”

AFP 2023