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LABOUR PAINS

Actors go on strike in new blow to struggling Hollywood studios

Susan Sarandon (centre) with Writers Guild of America members and supporters on a picket line outside NBCUniversal headquarters in New York on 23 May. (Photo: Stephanie Keith / Bloomberg)

For the first time in six decades, Hollywood writers and actors are on strike at the same time — a cataclysm for hundreds of thousands of film and TV workers already idled by the entertainment industry’s growing labour strife.

The Screen Actors Guild (SAG), which represents about 160,000 performers, announced a walkout on Thursday after failing to reach a new labour agreement with the Alliance of Motion Picture and Television Producers, which represents studios including Walt Disney and Netflix. The strike begins at midnight.

The Writers Guild of America, meanwhile, has been on strike since May 2, shutting down late-night TV programmes like The Tonight Show, halting many projects in progress and imperilling the traditional release of new broadcast TV shows starting in September.

In a statement before the strike, the studio alliance said it was “deeply disappointed” that actors have walked away from negotiations. The studios said they offered “historic pay and residual increases” and a proposal that protected actors’ digital likenesses — addressing concerns about artificial intelligence that have been raised by labour.

Work on dozens of popular programmes has already been halted including ABC’s Abbott Elementary and Netflix’s Stranger Things. Fox on Tuesday unveiled a fall TV lineup that consists entirely of reality shows and animated programmes already completed.

The impact of the simultaneous strikes, if they last more than a few days, is likely to be wider than the walkout by the writers alone. Programmes already written could still be filmed without screenwriters, but not without actors.

Actors will also have to stop promoting upcoming projects, such as at film premieres, awards shows and events like San Diego Comic-Con International, scheduled for next week. Programmes shot overseas could be impacted. And while other contracts may allow actors appearing in game shows or reality TV to continue working, they may get pressured to join the strike in sympathy with their colleagues.

Matt Damon and Emily Blunt had to leave the UK premiere of Oppenheimer to “write their picket signs”, director Christopher Nolan said from the stage.

Jane Fonda, Susan Sarandon, Rob Lowe and Mark Ruffalo are among the stars who’ve already walked picket lines supporting the writers. Other unions, including the IATSE, which represents 168,000 stagehands and other entertainment industry workers, have put out statements backing the actors as well.

“The longer it goes, it will just become a snowballing issue,” said Bloomberg Intelligence’s Kevin Near.

Labour Unrest

The great Hollywood walkout is part of a larger battle that has seen workers fighting for better pay and benefits from businesses as far flung as Starbucks, Amazon.com and Delta Air Lines. A union representing about 340,000 United Parcel Service workers is threatening a strike on August 1 if the company doesn’t meet wage-increase demands in talks to renew a five-year labour contract.

The entertainment industry is struggling to cope with two related problems: declining audiences for traditional TV networks and staggering losses from a new generation of streaming services like Disney+ and Warner Bros Discovery’s Max.

Disney Chief Executive Officer Bob Iger on Thursday said the strike will have a “very, very damaging effect on the whole industry”.

“This is the worst time in the world to add to that disruption,” Iger said in a CNBC interview.

Every major entertainment company has fired staff in the last 18 months, and many of them have pulled programming from their streaming services to cut costs.

Tragic Ending

In a way, the dual strikes mark a sad finale to a boom in film and TV that started when Netflix jumped into original production with House of Cards in 2013 and spurred a decade of record production.

Both the actors and writers say they’ve been shortchanged by the transition to streaming — and want to be paid a share of companies’ earnings from shows. They’re also seeking protection against the use of artificial intelligence, which they see as a threat to their jobs.

The last time writers and actors walked out together was in 1960, when SAG was led by Ronald Reagan. Both were fighting for revenue from movies that aired on TV, according to the Los Angeles Times.

The last strike by writers, a 100-day walkout that began in 2007, cost the California economy an estimated $2.1-billion in lost output. The guild now projects the cost at $30-million a day, based on its members alone.

The stoppage has hit companies that work with the film and TV industry, including owners of studio space like Hudson Pacific Properties. Talent agencies have imposed layoffs, furloughs and pay cuts.

Fewer Permits

In New York, home to TV productions like Law & Order and Blue Bloods, the number of permits to shoot films, TV shows and commercials fell 43% in June from their 2022 level. FilmLA, which administers permits for projects in Los Angeles, said its permit count was down 64% in the first week of July. No scripted TV series were filming that week.

In the short run, the strikes could boost profits for the media giants. With filming shut down, they won’t have movie and TV production costs yet can continue to collect revenue from cable TV distributors, advertisers and program syndication sales, even if they’re airing reruns or other shows.

“As long as they have content, they’re going to continue to make money,” said Chris Thornberg, founding partner at Beacon Economics, a research firm.

Still, the inability to commission and shoot new programming will begin to weigh on the industry in the months ahead. Media companies rely on fresh programming to attract and keep viewers or fill seats in movie theaters.

Streaming services have already spaced out new releases but face a major shortfall in 2024 if they can’t get production up and running before the fall.

Although the Directors Guild of America reached a new contract last month that included a pay hike of 5% in the first year, the writers and actors have shown less willingness to deal.

“In general, labour is not in a mood to be conciliatory at this point in time given the tightness of labor markets,” Beacon’s Thornberg said.

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