As this newsletter hits your inboxes, it’s been three months and a day since the Writers Guild of America (WGA) went on strike. Since then, Barbenheimer swept the box office while shows like Queen Charlotte and Beef lit up streaming. But inertia won’t carry Hollywood forever. Let’s look at what has Hollywood’s working class hopping mad and how the studios are fighting back.

In this issue:

• The back story - writers’ (and actors’) issues with studios

• Why haven’t I seen an impact?

• How will studios ride it out?

The back story - writers’ (and actors’) issues with studios

Most of the writers’ issues are bread-and-butter questions of pay and workers’ rights in a transforming industry. Most writers are not multi-millionaire showrunners like Shonda Rhimes (Bridgerton, Grey’s Anatomy) or Michael Schur (The Office, Parks and Recreation). But the way Hollywood worked in the past let writers make a good middle-class living.

Now, not so much. The WGA’s last contract with the Alliance of Motion Picture and Television Producers (AMPTP) member studios wasn’t structured for today’s entertainment industry:

• Streaming and cord-cutting broke the cable revenue model

• DVD revenue no longer exists

• Streaming series are 50-70% shorter than broadcast series

• Streamers do not share viewership data — or pay residuals

• Executive power and culture have shifted from Hollywood to Wall Street

• “Peak TV” sent production budgets skyrocketing

These changes had profound effects on writers’ ability to earn a living:

• Vanishing residuals from syndication and DVD sales cut long-term income

• Shorter seasons and fewer days per season cut short-term earning potential

• Writers’ pay did not increase when their streaming shows became hits

Despite rising production budgets, studios cut costs in the writing room by:

• Paying writers at contractual minimums rather than by experience

• Using mini rooms and other tactics to further reduce days worked

While many of the WGA’s concerns are about industry changes over the past two decades, some focus on the future — particularly the potential disruption from AI. The WGA wants to protect the integrity of screenwriting and make sure studios don’t use AI to abuse writers’ rights.

Why haven’t I seen an impact?

Inertia has worked in the studios’ favor. Writers’ contributions to most films and TV shows are concentrated early in the production pipeline.

Movies and special effects-heavy TV series stop filming long before the release date. Oppenheimer and Barbie premiered in early July 2023, but they wrapped filming in May and July of 2022, respectively. The WGA strike won’t impact many films or tentpole TV shows released this year.

With traditional comedy and drama TV series, writers change scripts at the last minute. The strike’s timing at the end of the 2022-23 season meant little impact during the summer off-season. However, production typically ramps up in August and September for the Fall season. Without writers, that won’t happen this year.

The most immediate impact was on late-night comedy shows. They depend on writers for funny hot takes on the day’s news, so every show went dark in May.

Then the actors joined in

With the Screen Actors Guild – American Federation of Television and Radio Artists (SAG-AFTRA) calling a parallel strike, an industry riding on inertia has hit a brick wall. Actors face similar challenges of inflation, declining residuals, and visibility into streaming data. AI is also a concern. Emerging technology could use actors’ likenesses without compensation.

How will studios ride it out?

The studios have a lot of deck chairs to shuffle. The question is, are tactics like these enough to wait out the writers and actors?

More foreign content

Expect more international content as networks and streamers source programming beyond the WGA and SAG-AFTRA’s reach.

The CW, for example, revamped its lineup with shows from Canada and Australia. Netflix executives told investors they may shift their production budgets to foreign studios.

More “unscripted” content

The last writers’ strike led directly to the rise of “unscripted” reality programming like Big Brother. The WGA and SAG-AFTRA contracts don’t cover these shows, even though there’s nothing real about them.

Some studios moved quickly. For example, CBS announced shortly after the strike began that the next seasons of Survivor and The Amazing Race will switch from 60-minute to 90-minute episodes, filling Thursday night’s primetime.

More news and sports

Media companies with strong news and sports operations can replace scripted content with actual reality. If the strike extends into 2024, expect to see even more coverage of the US Presidential race.

Monetize back catalogs

Studios briefly toyed with Netflix’s exclusivity strategy by making their back catalogs exclusive to their new streaming services. Not anymore. Old content is showing up everywhere as studios cut deals with each other to fill gaps left by production shutdowns.

Our takeaway: Time to read a book

In many ways, this is an existential crisis for writers and actors alike. They are fighting against an industry more concerned with quarterly numbers than sustainable working conditions. The two sides are so far apart that it’s hard to see how they will come together anytime soon.

If the writers and actors can hold firm long enough, I expect we’ll see a steady erosion in content availability and quality into 2024.

That’s when studio finances will finally hurt as viewership and subscriptions fall. Only then will the studios have an incentive to negotiate.

The Watchlist

Alice’s life is turned upside down after her parents die in a mysterious fire in The Lost Flowers of Alice Hart, coming to Amazon Prime Video, Friday, August 4th.

Only Murders in the Building returns for its third season. The show premieres on Hulu on Tuesday, August 8th.

Want to read about science news with a refreshing and snarky delivery? Check out Important, Not Important! This free newsletter helps you think deeply and act decisively about the most pressing scientific news while also making you laugh.

Gal Gadot and Jamie Dornan star in Netflix’s newest movie, Heart of Stone, dropping on Friday, August 11th.

What happens when the royal prince and the president’s son fall in love? Find out in Red, White & Royal Blue, hitting Amazon Prime Video Friday, August 11th.

Terry, Korvo, Yumyulack, and Jesse are still trying to blend in as a normal family in season 4 of Solar Opposites, coming to Hulu, Monday, August 14th.

Miguel channels his inner Mortal Kombat persona in Miguel Wants to Fight, the comedy coming to Hulu Wednesday, August 16th.