The Writers Guild of America (WGA) and Hollywood companies have said they will continue contract negotiations on Thursday after resuming talks on Wednesday in efforts to reach a deal on a new three-year agreement.
After 142 days of the work stoppage since negotiations initially broke down on May 1 – not to mention SAG-AFTRA’s own industrial action, which is in its 69th day – strike fatigue is rife in Hollywood.
Yet according to sources, Wednesday’s session in Shermon Oaks north of Hollywood was encouraging as Disney CEO Bob Iger, Warner Bros Discovery CEO David Zaslav, Netflix co-CEO Ted Sarandos and NBCUniversal Studio Group chairman and chief content officer Donna Langley were in attendance.
Both WGA and AMPTP issued a rare, short joint statement to say talks would continue on Thursday.
The presence of the four CEO’s indicates the urgency of the matter. Everybody wants to get back to work, and earlier this week WGA leadership met with showrunners who expressed mounting concerns over the ongoing work stoppage as rank and file members struggle to make ends meet.
Optimistic estimates have the strikes ending in October. After that the horizon extends to the end of the year and into early 2024.
‘Neither nothing, nor nearly enough’
This week’s resumption of talks is seen as a chance to reclaim momentum and mutual trust after the union and the companies’ representative Alliance Of Motion Picture and Television Producers (AMPTP) reconvened last month in what ultimately proved to be a setback.
Those sessions broke down on August 22 when AMPTP leaked what it called a “comprehensive” package of counter-offers made to the WGA on August 11.
The move blindsided the union, who did not expect AMPTP led by president Carol Lombardini to go public so soon or without its knowledge, and prompted its own statement two days later that the counter-offers on the core issues of staffing levels in writers rooms, data transparency and streamer residuals, and AI were “neither nothing, nor nearly enough”.
For the record AMPTP’s counter-offer included wage increases of 5% in year one, 4% in year two, and 3.5% in year three, which is what AMPTP agreed with Directors Guild of America in their June contract renewal. While that marked an increase on AMPTP’s last known offer in May of 4%, 3% and 2%, it fell short of the WGA’s demands of 6%, 5% and 5%.
AMPTP’s package also addressed staffing levels and duration guarantees, which WGA described as “effectively toothless” due to “loopholes, limitations, and omissions”.
The union conceded there had been “real” discussions in August regarding AI protection, but said those talks did not go far enough. The companies have agreed with a union proposal whereby writers keep their credit and pay when they use AI to help them write scripts, but the parties are at odds over WGA’s demands to regulate AI training on writers’ scripts.
WGA also said AMPTP offered to share limited data with union members who would return to the bargaining table in 2026 to thrash out a viewership-based residual formula. “In the meantime,” the union said, “no writer can be told by the WGA about how well their project is doing, much less receive a residual based on that data.”
Since the August exchange, WGA has continued to picket outside studios, streamers and networks in Los Angeles, New York and other entertainment hubs in what has been a sweltering summer. Members have struggled to pay bills and there have been reports of internal disagreements on both sides.
The ongoing strikes are reflective of broader economic realities, even more so than on previous occasions, said sources who remember those work stoppages.
Anger over income disparity between those who run Hollywood and the vast majority of members – not the upper echelons of writers and actors who can ride out the strikes in relative comfort – has driven the already formidable WGA, led in its negotiations by Ellen Stutzman, to remain steadfast while it awaits what it would regard as meaningful progress on its core proposals.
That steeliness has been reflected in the stance of SAG-AFTRA, whose recently reelected president Fran Drescher and chief negotiator and national executive director Duncan Crabtree-Ireland have not pulled punches when talking to press. SAG-AFTRA is yet to reconvene with AMPTP since it went on strike on July 14.
The compensation packages of Hollywood CEO’s has fanned the flames and by many accounts the standing of Disney’s Iger has dropped. Long regarded as an experienced, talent-friendly elder statesman who might have stepped in to broker a resolution, the 72-year-old multi-millionaire infuriated the unions and many in the industry when he told CNBC’s “Squawk Box” from the Sun Valley Conference in July that the unions’ demands were unrealistic.
The industry is anxious to get back into production. While sympathetic to the plight of union members who can barely afford health insurance or pay bills or have moved back in with parents, some have begun to bemoan the WGA’s hard line.
Whether this week’s resumption of talks is predicated on the AMPTP’s latest counter-offer in August or more recent proposals and counter-proposals made behind closed doors is unknown. Until this week, both sides were understood to be far apart on the core issues.
There is everything to play for but emotions are running high. What is clear is the industry, its writers, actors and everybody involved in making film and television – even the directors with their new contract – are hurting.
Production slowdown
It goes even further than that. Milken Institute, a non-profit, non-partisan think tank, said earlier this month that the dual strikes have cost the California economy $5bn, taking into account the impact on related sectors like catering and hospitality.
California Governor Gavin Newsom said he had been in talks with both the WGA and AMPTP and planned to reconvene later this week.
Production on US film and television anywhere in the world covered by a WGA contract and involving SAG-AFTRA members has virtually ground to a halt. No struck companies – studios, streamers, networks and other companies belonging to AMPTP – can cast, shoot or promote their film and television, let alone talk to talent agents about commissioning writers to write or actors to act.
At least 400 independent productions have secured a SAG-AFTRA interim agreement allowing production, casting and promotion to proceed. However many of these are low budget and anything covered by a WGA contract is prohibited.
A backlog in interim agreement approval has independent producers unable to cast projects and they worry that once the strikes end, the rush back to production will entice their preferred actors to work on higher-paying projects at studios and streamers.
Release schedule disruption
The fall festival trifecta of Venice, Telluride and Toronto were by and large relatively subdued without American stars on red carpets (international talent were able attend), and studios have pushed films like Dune: Part Two and Challengers into 2024, by which time they hope talent will be back at work to do publicity.
The production slowdown means fewer releases are expected towards the end of 2024, with the third and fourth quarters likely to bear the brunt as the scarcity of films impacts distribution pipelines.
Television has been similarly affected and the volume of new material in schedules will dwindle, forcing already beleaguered linear television companies to do re-runs.
Paramount just sent its smash Yellowstone, which has screened five seasons on Paramount Network, to Paramount Global stablemate CBS to complement its reduced autumn slate and the show’s debut on the channel fared well, attracting 6.6m viewers on Sunday night (September 17).
Streamers and media companies have already been licensing shows to other platforms as a way of generating revenue and the industry is watching to see how much these areas of activity grow.
At some point the streamers’ hitherto vast pipelines of film and TV will show signs of running dry, which begs the question will they pivot to a much more intense focus on international work unaffected by the strikes.
Netflix in particular has been excellent at bringing English-speaking audiences compelling titles from around the world, South Korea’s Squid Game and Germany’s Dark and 1899 being three examples, and has trained its subscribers to be open to subtitles.
Yet regardless of global ambitions, every Hollywood company wants to be back in the business of making English-language film and television with household names.
The general thinking is AMPTP and WGA will reach a deal to get the script conveyor belt back up and running. After that, sources say, a deal with SAG-AFTRA will follow.
Until that happens though, the industry continues to suffer and discontent continues to spread.
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