In January 2022, the most popular movie on Netflix was “Don’t Look Up,” a newly released disaster comedy with Leonardo DiCaprio and Jennifer Lawrence. But the second-most-popular movie was “Just Go With It,” an Adam Sandler flick from 2011 that had just started streaming on the service.
Timothy Dowling, who co-wrote the screenplay for that film, watched in anticipation as a movie he’d made more than a decade before inexplicably climbed the Netflix charts. But when his next residual check arrived, he received an unwelcome surprise. “I saw no noticeable change in the residuals I got,” Dowling says, referencing the money that film and TV talent receive when their movies or shows are broadcast, syndicated or appear on home entertainment platforms. He was baffled. “Clearly, Netflix paid money for this,” he says. “But is that money trickling down to the writer?”
The streaming economy — and the writer’s place in it — will be a central theme of the upcoming talks between Hollywood studios and the Writers Guild of America. The union’s current contract expires on May 1, and the industry is bracing for a major battle, and what could be the first strike in 15 years. That has the entertainment business growing increasingly anxious. Studio heads, producers and streaming executives are terrified that if the writers walk out, production will grind to a halt, putting people out of work and jeopardizing an industry that’s already experiencing a perfect storm of financial pressures, from rising debt to falling share prices, with the possibility of a recession on the horizon. If that weren’t enough, the entertainment companies also must reach new agreements with the major unions representing directors and actors, who might also take to the picket lines if their terms aren’t met.
“A strike would be devastating,” says Tom Nunan, the founder of Bull’s Eye Entertainment and a former top executive at NBC and United Paramount Network (now The CW). “It’s coming at a time when there’s so much uncertainty about the future. You’re already seeing a huge contraction in the industry, with companies laying off thousands of people and streamers going through their own retrenchment after several boom years.”
The Directors Guild of America and SAG-AFTRA contracts expire on June 30. The DGA has issued a warning to the studios that its members also have major issues to sort out in relation to the industry shifts that are taking a bite out of the incomes of workaday writers.
The WGA, however, is feeling emboldened, having just bested the major talent agencies in a high-stakes battle over TV packaging. And there’s a sense that if the guild doesn’t move aggressively now, it will risk imperiling the financial health of its members at a time when studios and streaming services are embracing profit models that threaten the old way writers made money.
“The WGA has become very empowered by its success at getting its members to fire all their agents during its dispute with the agencies over packaging fees and financial interests,” says Ivy Kagan Bierman, chair of the entertainment labor group at Loeb & Loeb. “That demonstrated to the WGA leadership that ‘our members are with us. They support us. They’re going to do what we want them to.’ That gives them leverage.”
If a strike takes place, many television shows will have to stop production because no one will be available to write new episodes. Films won’t quit shooting immediately because there are finished scripts waiting to get made. However, those films won’t have a writer on hand to punch up dialogue or smooth out plot problems. In recent months, production companies and studios have started to stockpile projects in anticipation of a slowdown.
Some sectors of the business won’t be dramatically impacted. The WGA has tried to recruit writers of reality television and animation, but with limited success, so that kind of programming could continue to be produced. But that’s not enough to keep the business humming at a time when it needs to keep earning money.
Despite a mounting fear that a strike is looming, some studio executives are feeling optimistic that such an outcome can be averted. In recent weeks, the union has sought to tamp down expectations that a strike is inevitable. After all, such talk can feed into an image of the WGA’s leadership as hotheaded and eager to shut down Hollywood — something union stalwarts say is simply false.
“The idea that the Writers Guild wants to drive Hollywood off a cliff is absolutely, ridiculously untrue,” says Glen Mazzara, a veteran producer of shows like “The Shield” and “The Walking Dead.” “That’s disinformation that’s put out there by a lot of different parties. The Writers Guild leadership is incredibly thoughtful, incredibly informed about these issues. They will not take unnecessary risks.” He adds, “They take risks.”
But, he says, those risks have paid off. In the 2007-08 strike, writers got a deal that “new media” — now called streaming — would be covered under the contract. And in the recent fight with the agencies, they eliminated the decades-old practice of talent agents earning packaging fees from studios for helping to assemble new TV and film projects. For decades, packaging generated hundreds of millions of dollars in income for agencies. The WGA, though, asserted that packaging was also a massive conflict of interest for agents, one that left the guild urging its members to part ways with agents who refused to end the practice.
Several writers say the stakes of the upcoming talks with the studios are just as high.
“The issues that are arising in this negotiation have to do with one thing very simply, which is the ability of TV writers to make a living without being independently wealthy,” says Marc Guggenheim, an executive producer of “Arrow” and “DC’s Legends of Tomorrow.” “It’s really that simple. It’s about whether being a journeyman TV writer is still a viable career.”
At the top of the profession, Netflix is handing out nine-figure sums to name-brand showrunners like “American Horror Story” guru Ryan Murphy and “Bridgerton” creator Shonda Rhimes. But that’s not the reality for most writers, who say it’s become increasingly difficult to sustain a middle-class livelihood.
Residual fees have long provided a cushion for writers, actors and directors, helping sustain them between projects. The formulas by which these fees were calculated have traditionally been based on TV series reruns and movie titles airing on the Big Four broadcast networks: ABC, CBS, NBC and Fox. But as the vast majority of content produced today winds up getting to consumers on the servers of streaming platforms, those residuals have dried up.
“If the result of this streaming model is to depress wages across the board for talent, at some point talent needs to push back,” says Jim Adler, a producer on “MacGyver” and “The Good Doctor.” “People need to make a living.”
Writers are also pushing back on industry trends that have stretched out the development process and limited writers’ employment opportunities. The WGA is particularly focused on “mini-rooms,” which have replaced traditional writers’ rooms on many shows.
A mini-room is both shorter in duration and smaller in terms of staffing. Instead of hiring a full staff, a showrunner might bring on two or three writers to work for six to eight weeks to develop a show before it goes into production — and often before it’s even greenlit. This has the effect of saddling fewer writers with more work for less pay. It also means that writers don’t get hands-on experience producing shows.
“We learn how to make TV by making TV,” Mazzara says. “That experience working with actors and directors is really important when you come to develop a TV show. So this is a real problem.”
Writers have traditionally been paid by the episode. But the number of episodes per season has been declining — even though the time it takes to write a full season has stayed the same. The WGA has bargained for “span protection,” which is a mechanism to pay writers for the extra time spent per episode. But many writers believe it doesn’t go far enough and want a more aggressive approach.
Others have also become annoyed by the “notes” process, in which they will have to write the same episode repeatedly. “They’re asking for constant rewrites,” Guggenheim says. “It’s an abusive process.”
Writers are angry, too, at streamers over the abrupt cancellation of finished shows by networks looking to save money, as well as Warner Bros. Discovery’s decision to mothball the movie “Batgirl” to take a tax write-off. These moves have left a lot of union members in a combative mood. “I think the vast majority of writers are willing to strike for these existential issues,” Guggenheim says. “The vast majority of writers — they’re living hand to mouth.”
At the same time, nobody wants to go on strike. Many remember the 2007-08 strike, which shut Hollywood down for three months. That was a draining, emotional experience, and highly disruptive both to the industry at large and to individual careers.
If another strike happens in 2023, it would upend a business that is struggling to recover from the pandemic, and is already seeing cutbacks. Companies like Netflix, Disney and Warner Bros. Discovery have signaled to Wall Street that they’re serious about cutting costs, as they look to pay down the debt they’ve amassed while building their streaming libraries or undergoing mega-mergers. These companies don’t have much choice: Investors have soured on the entertainment sector after seeing how much red ink it has been hemorrhaging to build an audience on streaming. And they’re no longer measuring quarterly success in terms of how many new subscribers have been added, but by cash flow and profits. That could cause issues when finding a compromise with writers who believe they’re being deprived of their fair share of the spoils.
“The entire town is dealing with fear, anxiety and depression, and that’s without there being a massive strike,” says Peter Newman, head of NYU Tisch School of the Arts’ MBA/ MFA program. “Companies are bleeding money, and no one has figured out a cogent business plan for the next decade. There might not be enough pieces of the pie to go around.”
If an agreement can’t be reached, a work stoppage could cause a lot of pain.
“No one wants to burn it all down,” says Spiro Skentzos, co-chair of the WGA’s LGBTQ+ Writers Committee. “The majority of everyone wants to get past it — like, can we get the negotiations and be done so we can move on?
