Hollywood Studios’ WGA Strike Plan: Let Writers Go Broke, “Lose Apartments”
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Hollywood execs would claim they'll hold out indefinitely, if they thought anyone would remotely believe their claim.
I absolutely buy willingness to hold out. I have no way of telling the public sentiment on the issue though, which could be a factor.
1: https://en.wikipedia.org/wiki/1942%E2%80%931944_musicians%27...
Not necessarily. If the writers had pulled this in 2021, they'd have won. Everyone wanted to buy more content. That not only made the opportunity cost of not producing larger, it introduced the credible threat of writers picking off the studios one by one or even decamping to a new entrant.
Why? Due to the way Hollywood treats writers, they're already used to having periods of 6-10 months or so without any writing work.
> there is just so much content out there, re-running old stuff is a valid tactic until other steps are necessary.
But it doesn't raise the stock price. At best, it might keep it afloat for a while. Unlike the writers, the studio execs are expected to show growth on a regular basis.
And bear in mind that the studios have already been using "Your favorite shows won't have new episodes! Doesn't that make you want to force the writers to accept our utterly one-sided contract??" as a cudgel toward fans—so they think that "watching old content instead of demanding the new right away" is, at least to some extent, not in their best interests.
My apologies. I assumed it was clear from my post. Executives have more money to burn through. They also do not automatically lose money, when writer don't work ( streaming services bring in steady flow as long as you have a decent library ). Who knows? Maybe this will force streaming services to share the digital library in an effort to outmaneuver writers ( one giant library of oldies to draw from ). Seems unlikely, but it all depends on how hell bent executives really are.
Now compare that situation to that of writers. It does not look as promising.
<< Unlike the writers, the studio execs are expected to show growth on a regular basis.
Eh. Execs have to mollify investors and investors are not unlikely to support 'heavy negotiation tactics'. As such, I am not sure if they have to worry about 2023.
FWIW, I may very well be wrong. I am a sucker for a David vs Goliath story, but the deck is heavily stacked against writers.
We're in this perfect storm of circumstances where the WGA strike is PROFITABLE for the studios, and not only they're not motivated to negotiate, they're motivated for this strike to go on for the rest of the year at least.
The studios are not bluffing. They're comfortable right now. Do you know who's bluffing: WGA's Adam Conover. He said "we're in it for the long haul and we'll support all our members who need to pay rent and mortgage with our strike fund". Source: https://twitter.com/adamconover/status/1679296015378030596
Let me tell you something. WGA's strike fund is $20 million. They have 20 thousand members. That's... $1000 per member.
That's not enough to cover all their members for "the long haul". It's a joke, and they'll fail.
- First we had Netflix rent DVD's over the mail.
- Then video on demand started displacing them, so they were focusing more on directly delivering content over the Internet, as the Internet was becoming fast enough for this, and they were installing caching servers at major ISPs to reduce their complaints on wasted bandwidth.
- Other studios saw Netflix may become a huge monopolistic platform for distributing content, that'll replace to a large degree other networks, so they created Hulu, then HBO GO (then HBO MAX, now MAX), Amazon made theirs, Disney made their, everyone was in on streaming wars.
- In these wars, exclusivity was one of the most important weapons. HBO have always had their own content, so now Netflix and others felt like they need to have theirs. Exclusive to them.
- So everyone started shooting shows, to fill out their library of exclusive content. Movies, series, from bargain basement B movies to top notch blockbusters, even Scorsese made movies for streaming.
- In the aftermath of COVID, everyone saw cooling down of home entertainment demand, and inflation also further cut into their userbase and revenue stream. But they had no choice, they had to keep making content, because everyone was making content and no one wanted to be left behind.
- Eventually they were starting to cozy up to the idea of "cease fire" where all the major stream vendors will slow down production or otherwise they'd all lose even more money. But there was no way to do this. How do you slow down production evenly? How do you measure it? How do you verify it? Who is first? On top of that existing long-term contracts on shows meant they had to keep production running out of legal obligation.
- Enter the WGA strike. A forced cease fire on all streamers to stop production. Force majeure means you can pause or cancel contracts. Blessing in disguise.
They don't want to shoot shows now. They want that strike. And this is why while writers have some fair demands (and some frankly absurd ones), they won't get what they want. Writers are screwed.
It’s possible they won’t for a long time. In that case, studios would keep a steady stream of income despite no new shows. That would greatly reduce the leverage that writers have. That’s the background to these studio comments.
Typically there has been a tight connection between new content and steady revenue. Studios needed new movies every month to generate income. Networks needed new episodes every week to keep audience up and advertisers spending. But streaming services auto-charge every month or year unless the consumer makes an effort to stop it.
It’s an opt-out revenue model instead of opt-in.
Meanwhile the revenue from streaming probably isn’t enough to produce quality content; all the cool prestige series on streaming are backed by speculative investment money from the low interest rate era. Netflix, which probably has the best analytics and the least commitment to legacy Hollywood, has already pivoted to cheap “reality TV” content over their earlier prestige offerings.
>Typically there has been a tight connection between new content and steady revenue.
This isn't really true either, as content is hit based business not too dissimilar from venture capital. Sure you can always play it safe by milking an established brand but you always need to be running experiments.
Normally you’d say that a streaming service that is not producing scripted hits would lose subscribers to one that is. But if none of them are producing new scripted hits? The old hits might hold onto folks for a while.
Call it the “gotta watch something” theory.
It is a historically tight labor market. I wonder if studios are worried about that.
This whole thing could just make Lyft and DoorDash in LA slightly cheaper rather than seriously hurt (already underpaid, if the guild is to be believed) writers.
Writing for American TV and film is a very unique skill set and virtually everywhere you would work is covered by the union. All productions have been shut down.
The same union covers if you're writing in New York or Atlanta. And they're not going to pick up and go to London or Mumbai.
The backup plan really is DoorDash, Uber, etc.
...But creative writing in general doesn't tend to pay the bills on a regular basis without the exact types of residuals the studios are actively trying to take away from them. So they're already used to having to pick up side gigs or even have day jobs to make ends meet.
Writing novels is not a reliable source of income, and fanfic doesn't make money at all.
It's true that TV writers often do have to pick up some kind of work in between seasons, though it depends on the show.
But you also can't make a living writing for TV year-round (each gig is on the order of 2-4 months, from what I've read)...unless you earn enough residuals.
So...wait, that would mean that without solid residual schedules, TV writers...just can't make a living??!
And those residuals are exactly what the studios are trying desperately to take away from writers.
But in case you're not, writing for TV is a full-time job. It's not something you can do on the side.
Having more than one “full-time” job is not unheard of, and its particularly a thing where at least one of them is a precarious and/or poorly paid one.
If you work in a professional TV writing room, you simply don't have another job on the side. It's not an option.
For all those hours writers have demonstrably been worse and worse every decade.
If shows take forever to write now, it's because everything is written by committee.
Regular writers are not pulling the crazy hours that Trey Parker and Matt Stone are. And they put out episodes faster than any other show.
I think all of Hollywood is finally falling over. And it's far past time.
On that note... I'm not actually convinced "new content" is all that necessary, even though that is an intuitive assumption on my part.
$40 billion in revenue yearly, $50+ billion in debt needing servicing, annual gross profit $13 billion, Market cap $32 billion. They aren't exactly the world's healthiest company.
What's the plan? "World-class" Cost-cutting and price hikes, everywhere. Even if it's multiple 95%-finished movies (Scoob! Holiday Haunt, Batgirl), send them to the shredder for the tax write-off if their success is uncertain. Taking risks or releasing anything that possibly won't be a hit, is not affordable at the moment.
What about Disney? Disney+ is losing $4 billion every year, and now has a lawsuit ongoing about whether the projections of profitability were ever reasonable. And it has also become apparent to investors that the content deluge and the expectations it set has caused massive damage to Marvel, as well as Pixar's Box Office profits. Pixar's Elemental, for example, just had the second-worst box office opening after the original Toy Story... except that Toy Story opened with 28 years less inflation, and on a Wednesday. The good news for Disney is that Elemental has had quite a recovery, even if it almost certainly won't break-even.
Now you've got this quibble with the Writer's Guild; at the same time that making new content to prop up streaming numbers has never been under more scrutiny, and the pocketbook has not been such a concern in years. You can afford to take a break - heck, you might have even been considering taking a break anyway; and by taking a break you can theoretically win a better deal with the Writers to save even more money in the future.
When I say "peak" I didn't mean it was a cliff, I'm at the quality of the net produce started declining somewhere around then.
Sure, there have been some fantastic movies made since the early sixties, but not as many as before
I somewhat agree. I think that "new content" is certainly necessary, but I think there's a massive deluge of it, beyond what we actually might need/want - the volume could certainly decrease, IMO. But we digress...
I think the insistence that AMPTP is totally unified on forcing the writers into homelessness is a bit villainously overblown; sure, streaming-only companies like Netflix can weather this by just picking up more global content and unscripted work, but keeping the strike going through Q4 is going to expose some real strategic fissures between streamers, networks, and studios that cash hoarding alone isn't going to paper over, especially since the studios' bets on blockbusters and in-house streaming aren't paying off. If AMPTP is really serious about this, the studio chiefs could end up taking down their own companies by exposing them to potentially multiple quarters without significant new content availability. With IATSE negotiations coming up in 2024, it seems unlikely to me that the studios are willing to lose the rest of this year and then go right back into a strike situation.
There are no LLMs writing scripts for TV productions today, and yet, WGA writers are out of work. Something political - I mean, something that is totally controlled by humans, and can be turned around with a stroke of a pen, if collectively - has the biggest impact on writers' work. Not technology. In case you're confused where my opinions lie, I do support the writers, because this is what they are actually asking for:
> But the fear is that studios will use AI to turn out a crappy first draft, and then turn it over to writers who they hire for a few days or a week to turn it into something good. And they won’t pay them as if it’s an original script. That is the fear.
https://variety.com/2023/biz/news/wga-ai-writers-strike-tech...
The whole article is about how studios have a tool that could seemingly pass legal muster and abrogate a lot of the economic obligations they have when they start an engagement with a writer. Basically via tricks. It's about politics.
Writers want to use AI. They also want to use Google and pirate movies and TV shows and read other people's books and file the serial numbers off of the characters and do all sorts of things that have complex copyright implications. This isn't about luddites or whatever the fuck.
What they don't want is for studios to do tricks. They want "we will not use this to do tricks where we pay you to do something that has for the last 20 years meant X and then when it turns out you make us a ton of money, it will actually mean Y." That sounds like a reasonable contract term for me. If you see a trick coming from a mile away; if your opposing party has a trick-manufacturing machine overseen only by octogenarians, and you have collective bargaining power, what else can you do?
There's a lot of other stuff, like staffing requirements and increased pay, that the studios are frankly not in a position to concede on. This strike should have been staged in 2021, or not at all.
You should look at the Sony hack and see for yourself what a studio does and how it is built. You don't have to rely on any speculation whatsoever.
I know gaming better. Steam gives away for free all the proprietary data movie studios hoard. A few people with Steam data, if they're numerate, can do the work of 1,000 movie studio people.
People are worrying about LLMs and economics and all this bullshit. It's all political, in the strict sense of the outcomes are controlled entirely by people and can change with the stroke of the pen.
The real thing the two sides should be worrying about is not this speculative AI bullshit or copyright law. It's how Hollywood is working more like the games industry does.
I've seen a dozen different posts and articles where people did the math, and showed that what the WGA is asking for, financially speaking (annually), could be paid out of a single studio's profits for a single quarter (at least, I think that was the degree of disparity; in any case, it was painfully obvious that the studios were being obscenely greedy).
The only way one can argue that the studios are "not in a position to concede on" these demands is if they take Wall Street's insistence on ever-increasing growth as mandatory, rather than purely for the benefit of increased bonuses for the already-very-wealthy people at the top.
Sure, this. Management is constrained because, after the last years' spending and leverage binge, they are unusually dependent on investors. Investors who didn't like the past years of spending levels and demanded cuts. Cuts management promised and the WGA delivered.
> on ever-increasing growth
I don't think this is about growth. See this commentary on Discovery's equity [1]. The focus isn't growth, but servicing debt. If they give into the WGA, there are knock-on concessions to other unions, and altogether that could bankrupt them. Certainly quicker than not putting out scripted content.
To be super clear, I think the writers deserve better pay. But the strike doesn't make sense.
[1] https://finance.yahoo.com/video/warner-bros-discovery-merger...
Oh nooooo if they have to give concessions to other unions, too, then more people might be able to live comfortable lives without having to bow and grovel every time an exec looks at them funny!
The strike is absolutely necessary, and it's about more than just pay right now.
First, it's about the near-complete loss of residuals as viewing shifts from TV to streaming (because the old contracts didn't cover it), which would, as I alluded to earlier, mean that writers would basically never have a stable income stream again. The entire visual-medium-writing profession would be consigned to lives of scraping together little jobs here and there to make ends meet.
While the studios raked in the billions in profit (not gross!) off the backs of the scripts those writers created for them.
And second, and possibly more importantly for the long-term viability of the industry as a whole, the studios are destroying writers' rooms. Traditionally, when writing a script, they'd hire a whole bunch of writers—including both senior and junior writers—and have them all work together on it for an extended period—possibly the entire run of a season, or most of the way through the production of a movie. This was a vital way for newer writers to gain experience and practice their craft.
Now, they're instead hiring a bunch of writers for a week or so, getting them to hash out the rough outline of a script, and then having one showrunner take over from there.
And what they're trying to do is get rid of that first step, and have ChatGPT do it, instead.
They're eating their seed corn, all to juice their profits in the short term, and totally ignoring what the long-term effects will be: fewer and fewer writers who have any experience actually writing for television and movies, on top of making sure to starve the ones they do still (occasionally) hire, thus driving even more out of the profession.
In short, if the studios get their way, they'll be guaranteeing a decline in quality of writing across the board for the foreseeable future, until eventually there's nearly no one human left who's both willing and able to do the job and still pay rent.
Practically every studio was announcing cuts to programming spend in the months preceding the strike. An industry-wide pause means nobody loses market share while delaying expenses.
Probably because, like you mentioned, Netflix can more easily lean on foreign content.
I think Netflix is being particularly shitty here because they negotiated unique terms with the unions 10 years ago under the guise of being a new business model. They aren't "new" anymore, they are an established player, they should have to play by the same rules as the big boys.
Well, playing by the same rules as the big boys can also be attained if the big boys join the rules that Netflix negotiated (which are, of course, less favorable for the writers). I do believe that many studio executives will at least attempt to make use of this once-in-a-life opportunity. ;-)
I have seen at least one movie that grossed a billion dollars that could have very well been written by an LLM. In fact, that was one of my immediate impressions while watching that movie. I don’t think it would be sustainable to do this across the industry but it could easily be done.
There is also a big difference between a factory that can’t be stopped for months and Hollywood that can operate without scripts until the box office will indicate that you actually need writers like last time. The studio plan might be to bust the WGA entirely.
General public once again will realize just how unimaginative and unfunny political commentators actually are without scripts and how much of the insight is actually meticulously crafted.
Its 2008 all over again, and its a good thing.
Perhaps as a bonus, we can get an uncensored version of ChatGPT/Claude. I suppose getting the following response too many times will be frustrating:
“I am an ethical AI. The actions you are trying to portray of Prince Aemond Targaryen do not meet the standards of ethical, non-harmful conduct. Would you like me to rewrite the script in a more ethical manner, respecting human rights?”
When someone like Zaslav ignored the Yentaverse completely and adjusted the streaming approach to another bucket instead of a loss leader, they have positioned their companies for future revenue and success.
I was in a union for a long time so it’s not surprising the language or action companies use.
Related reading: https://twitter.com/happyroadkill/status/1654179858090475536
[1] https://www.indiewire.com/features/general/hbo-max-cancellat...
Given time horizons, seems like one of the inevitable long term options for them, is diversify writer rooms across countries with similar cultures to intended audiences
That would, of course, break the WGA. The WGA's existence depends on major movie studios needing them. If the movie studios decide to adapt in a way that the WGA is unnecessary... they're dead, and no writer will stick with them, everyone will scab. The WGA would have to beg SAG-AFTRA and the DGA to strike on their behalf, but that would cause... lawsuits; lots of lawsuits; because is it legal for one union to strike to save another union?
Turns out people like watching things written by the best writers - and plenty of studios would defect if they got to be the only studio with access to most of the best television writers in the West.
Someone unaffiliated with the WGA takes a job and then is ostracized? That sounds pretty evil, and it puts me firmly on the side of Hollywood.
The world is different now. Economy is global, people are trying to make a living doing something that makes them happy. Not everyone is a union member, and it’s absolutely ridiculous to extort a young professional from taking a career defining opportunity because a certain, very entitled group decides they want it even better.
Unions striking is within their right. Go for it. But it’s absolutely unacceptable to start blacklisting non-union people who don’t fall in line because the union doesn’t happen to have as much bargaining power as they would have liked.
> One insider called it “a cruel but necessary evil.”
What makes this necessary? What, except for the profits of the owners?
People like this should not be allowed to participate in modern society. They are taking everyone around them down to raise themselves a few millimeters.
That's what we get for insisting that the stock market's rules run everything - where executives are bound by law to increase profits every quarter.
<sarcasm> Won't someone consider the plight of the bankers and analysts? </sarcasm> God forbid they are made to look bad when people making a banker's bonus as an annual salary want to protect their livelihoods.
edit Oh yea agreed that the structure exists as individuals enacting it
Madman theory: https://en.wikipedia.org/wiki/Madman_theory
They see "replace all of them with AI" as inevitable and utmost required for profit maximization, and therefore, every extra day of a writer being hired for even the smallest compensation is, to them, a great act of charity towards undesired and eventually irrelevant workers. So writers and actors causing an issue in the face of that 'charity' is deserving of the harshest and coldest response possible.
They literally just went to shareholders and promised to cut spending on new content.
This is not a madman act, it's fundamental leverage. The writers have no way to force negotiations in a game where they lose advantage with time. The studios' optimal strategy is to wait.
> since they don't have infinite financing
Pausing spending on new content is cash-flow positive in the short term. You know what makes shareholders prioritise the short term? High interest rates.
Agree, also on the short/long term perspective.
I was only responding to the "madman" ploy part, and it does help if they portray a "We're fine, and we DGAF if we're not, as long as many of you lose your housing".
I just hope the writers are ready for a long haul, because if they can make it to a mid-long term strike, the studios will have real problems, especially if SAG maintains solidarity. Sitting out a season is one thing, sitting out an entire year or two is another. But they may need to last until next (2024) summer to win.
Sort of? They'd have to make that second argument, though. Which aren't and don't need to. Because the strike is literally saving them cash.
> sitting out an entire year or two is another
The streaming space is crowded. Discovery is probably the weakest of the bunch, Disney the strongest. Which creates an interesting dynamic. Why would you agree to break the strike that will break your competitors first?
Yes, for the short term. I have a manufacturing business, and I save loads of cash when I don't make anything. The numbers look really good when production isn't running, and we're just selling existing inventory. Studio inventory has a bit more of a shelf life and re-sellability, but the demand for new content is insatiable.
>>Why would you agree to break the strike that will break your competitors first?
Agree; that is an interesting dynamic. But what is the negotiating model? Is it like the auto industry where one company makes a deal with the union and that deal becomes a template for the contract with all other companies, or is there a different model? Does the first company (presumably the weakest) that makes a deal set the stage for the others (& would they get help from stronger companies)? Or is it that all companies must make one agreement simultaneously, and what is that voting structure (majority of companies, unanimous, etc.)?
The mistake was made at the beginning. Studios shouldn’t have binged. The manufacturer shouldn’t have upsized. After removing sunk costs, the path forward necessitates cuts: the question is who pays for them. The WGA, by striking when it did, volunteered its members.
If you have to make cuts, and your personnel strike at the same time as all of your competitors, that’s a caviar-rimmed gift basket to management. They delivered on their promise to shareholders, and can count every minute of the grind as a sign of their fortitude.
> what is the negotiating model?
Dunno. WGA picked off studios at the last strike, so it was at least then an option.
Yes, anyone can write a passable show just like anyone can write compilable code.
I encourage you to enroll in a screenwriting class if you don't believe me. You'll understand soon enough. :)
And I'll go a step further and seize on the word "passable". Would you rather watch a show that's simply good enough to "pass" as a show, or something of higher quality? Plenty of people can write something that you could pass off as a show, but I'd imagine that that number drops as you reach for something of a higher caliber.
As for quality, it's not clear to me that current shows/movies are even that good in terms of writing. If you are a truly talented writer that can make/break a work you should have similar leverage to a director or lead actor, but studios don't think you are and that's why you're in a union. Maybe if your buddies that are actually talented gave a creditable threat of committing career suicide that would be good leverage, but it doesn't seem like a real threat when top talent will always be paid well.
Passion "for the work", not necessarily simply writing a show itself. I'm talking about being in a writer's room with others for eight-plus hours a day, dealing with the opinions of others, being OK with having your ideas axed because some producer didn't like it for whatever reason, the process of pitching ideas, and everything else the job entails.
Absolutely no implication that unions are loyal, no
Bad idea. Just shut down.
https://decider.com/2023/05/02/late-night-television-shut-do...
Not every night.
There isn't a person on earth who can write an entire good late night monologue by themselves, consistently, every single night.
https://www.forbes.com/sites/marisadellatto/2022/09/30/how-l...
>Noah’s premiere episode as The Daily Show host in September 2015 garnered 3.47 million viewers, directly on par with Jon Stewart’s final episode a month prior.
> That year, The Daily Show averaged 1.1 million viewers, lagging somewhat behind broadcast shows like NBC’s The Tonight Show Starring Jimmy Fallon (3.78 million), CBS’ The Late Show With Stephen Colbert (3.17 million) and ABC’s Jimmy Kimmel Live! (2.53 million), according to Variety.
Meantime, Joe Rogan averages 11 million listeners per episode:
https://www.sportskeeda.com/mma/news-what-joe-rogan-s-viewer...
I suspect Fresh Air (Terry Gross) also beats them all, although that number seems a little harder to get specifically:
https://www.pewresearch.org/journalism/fact-sheet/audio-and-...
"Those are not comparable!" you say? Exactly. Rogan and Gross are people who have one guest at a time and actually talk to them. It's pretty clear that audiences are starting to prefer that.
But I think the majority of late night viewing may be on YouTube the next day. It certainly seems to be thriving there. At least when there isn't a writer's strike.
I don't know why you personally want talk shows shut down. Many millions of people enjoy them, and if that pays their bills, then what does it matter to you?
It's not like 12:00 am is a super coveted slot that they're taking away from something else that would be more popular at that time.
No, does it bother you to see late night shows attacked? Apparently it does since you keep replying.
This was originally a comment about the late night shows shutting down for lack of writers.
If TV executives are considering dropping them altogether and turning the time slot back to local stations, that must mean they're really doing worse than the other shows.
This sentence doesn't even parse:
> Many millions of people enjoy them, and if that pays their bills,
whose bills? the "millions" who enjoy them?
> It certainly seems to be thriving there.
https://www.youtube.com/watch?v=FTmk7X8vGQk has 3.3M views, and that's a "best of" collection. What's the viewership each day, and is that the whole show or just a few excerpts?
> No, does it bother you to see late night shows attacked?
You literally started by telling them to "Just shut down" and criticizing hosts for not writing all their material. All your comments indicate you're bothered. It's just curious to me that rather than simply not watch the shows, you're actively attacking them and wishing they'd shut down.
>> Many millions of people enjoy them, and if that pays their bills,
> whose bills? the "millions" who enjoy them?
Pays the bills of the networks. In other words, if the shows are profitable. They wouldn't keep going if they weren't profitable.
I guess irony is lost on you.
> They wouldn't keep going if they weren't profitable
"Profit" is an opinion, as any accountant will tell you. The studios' opinions are apparently wavering on this one.
I guess it is...? Because I really can't imagine what else you meant there.
"Bad idea. Just shut down." they say.
Then it would have been obvious what was going on. But I hate being obvious. It ruins the impact.
The opening, "Oh, no. Those late night comedians might actually have to think up their clever monologs! Like they did when they were struggling stand-up comedians. They might have to interview their guests as if they actually knew anything about them." was supposed to serve that purpose.
I got that from the start. There's no irony involved with that.
But there are lots of people who like late night shows as well, which is what keeps them on the air and on YouTube. TV shows shouldn't end just because you don't like them.
When we watch TV shows those are almost always written by a team of writers as well.
Writing and performing are different skills. Actors don't write their lines either.