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Production slowed significantly in anticipation of a likely strike.
Broadcast is still a significant source of revenue for the traditional media companies.
The broadcast business has had double-digit declines for the last five, eight years.
Its just been a dreadful business.
But those were declines from very lofty heights, and theres still a lot of money there.
The other thing is that its not clear how much backlog content the streamers have.
Its especially distressing for them because of the decline in theatergoing.
Anyone whos honest will acknowledge that there will never be a complete recovery in cinemagoing.
Hollywood is a union town.
The percentage of unionized jobs in the general economy is about 6 percent.
Its tiny, especially outside of public employment.
Hollywood is very different.
If you want a good script, it is going to come from a Writers Guild member.
They just have that level of coverage of the business.
Can studios still produce films they have a full script for?
They can produce the script, but there wont be a writer standing by to do production rewrites.
When the star says, Not only are these lines not working, this whole scene isnt working.
Are they 110 percent satisfied with the script as it stands?
But a lot of production wont happen for the duration of the strike.
What is the order of shows going dark?Late-night has already said its going dark.
Next would beSNLandBill Maherand so on.
Next would be online grid, then streaming?Before online grid shows, it would be soap operas.
But if the strike lasts long enough, itll delay the start of the fall season.
Look at what Warner Bros. You gained content with no increase in your subscription price.
Look at Shonda Rhimes and Greg Berlanti.
And some of those deals have inevitably been unprofitable.
Others may be on the bubble as to whether theyre profitable or not.
All these deals, speaking generally, at least contain a force majeure clause.
Youre going to see a lot of deals terminated.
Youll probably see other deals renegotiated under threat of termination.
But in return, the guaranteed amount in the overall deal would be reduced.
And during the duration of the strike, when theyre not producing, they save money as well.
In the short term, they have a quarter thats going to look good because of the strike.
Im curious about how concerns around AI are affecting negotiations.
The argument they made was that it was a nascent technology, saying, Its just emerging.
And now the AMPTP is proposing the same sort of study approach to AI.
Well, its true we dont know.
We dont know when and in what iteration ChatGPT will actually be able to do useful screenwriting work.
They dont want to make the same mistake twice.
How does the increasingly globalized nature of the entertainment industry affect the strike?Scripts can be easily emailed.
Footage can be easily transmitted.
That makes the industry even more susceptible to globalization than other industries.
And when the strike ends, the numbers wont settle back to what they were beforehand.
Theyll be somewhere in between.
An existing trend toward globalization of content will probably be accelerated.
It means more competition for the writers.
Not just with words of affirmation but also by walking away from potential jobs.
We also will see a somewhat newer player, which is foreign-produced content.
Foreign content was a niche business once upon a time, but not sinceSquid GameandBerlin Babylon.
It scared Wall Street, and the tune has changed.
The WGA released a document outlining its proposals and the AMPTPs counterproposals.
In that, it seemed as if the AMPTP was rejecting proposals involving mini-rooms.
We dont have confirmation from the AMPTP.
Its a development of the last five years or so.
We almost saw a strike in 2017, and mini-rooms were not really in play then.
The Guild wants to reverse the trend toward mini-rooms, and the objection is severalfold.
One is that fewer writers are staffed.
The second is that those writers dont work for as long as writers do in more conventional writing rooms.
The third is that the pay structure tends to be lower.
The fourth is that many mini-rooms close before the series even begins production.
How can TV and film studios pay for these WGA proposals?
Its hard to see that changing.
Were not going to see an anti-capitalist revolution.
The answer is that it comes out of the profits.
And the question is how will Wall Street react?
Again, its not all or nothing.
Can they afford a dollar more?
Can they afford a hundred dollars more?
Thats the cost of the Los Angeles economy.
Adjusted for inflation, that would be $285 million a day now.
However, a certain amount of production has moved from L.A. to Atlanta.
But the L.A. economy will take a significant hit.
The first thing the furloughed employees do when theyre not working is apply for unemployment.
The second thing is to reduce discretionary spending as much as possible.
Those are the effects were talking about.
But if were talking nationally, I do think thats right.
So by definition, there will be compromises and negotiations, not a shopping spree.
You dont get everything you want or even everything you feel you deserve.
So if the studios and streamers are suggesting one number, then the writers are suggesting another number.
Theres potentially a compromise in between those two numbers.
But right now, the numbers seem pretty far apart.Yeah, they do.
What the strike reminds us is that negotiations are ultimately an exercise in raw power.
The most powerful tool labor has is to withhold its labor.
It hurts the workers as much as, or perhaps even more than, it hurts the studios.
But they feel that they have been pushed to the wall and that they dont have any alternative.
When do talks resume?There are no talks scheduled.
The AMPTP broke off talks, stating that the Guild was being unreasonable and unyielding.
The Guild says the companies are being unreasonable.
Thats not a formula for talks resuming.
The talks wont resume until both parties are willing to talk again.
There will be back-channel attempts to resume talks if they arent already going on.
At some point, a federal mediator will be deployed.
That has never proved to be effective in the Hollywood strikes, at least in recent years.
Right now, the writers are in fight mode, not talk mode.
This interview has been edited and condensed for clarity.
