The shutdown has had a lot riding on it for everyone
Andy Marken October 2, 2023
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The Beast is a sentient creature who represents the highest form of humans' evolution. He believes the time of ordinary humanity is over. I hope this makes you feel calm. You will be in the presence of something greater. Dennis, Split, Universal Pictures, 2017
Source Split Universal Pictures
Right about now, both sides of the first joint WGA/SAG-AFTRA (writers/actors) walkout in more than 60 years and their adversaries, AMPTP (studios, networks, streamers), have finally found one thing this would be a great business if it weren't for the people.
Even the simplest of issues - pay increases and streaming residuals - have yes but and how about problems that can be worked out so that neither side is happy with it but that's what makes a good agreement.
And when you have about 20,000 writers and 160,000 entertainment professionals involved, there will be a lot of questions and issues that go unanswered or aren't addressed.
The biggest challenge is that the two unions are different from most unions.
Consider the UAW, the UPS drivers union, hotel staff unions or teachers unions. The pay, challenges, pain points are similar if you've been a member for one year, 10 years or
With the WGA/SAG-AFTRA, there are perhaps 10 percent of these folks (A-listers) that AMPTP members actively solicit for specific projects, and they usually negotiate their specific contracts.
Most are folks you may kinda recognize from something you don't really recall, someone who has been diligently/effectively doing their job for years or newer members who want to perfect/refine their expertise and work in a business they like/love.
On the other side of the table are the 350 AMPTP members, many of whom took a much needed break in mid-July to take their private planes to the annual Allen & Co Sun Valley Conference where the who's who of the financial, media, technology world get together to unwind, network, golf and occasionally do deals.
Deal House - Every mid-July, Allen & Co turns the Sun Valley Lodge into a cool respite for studio, tech and other executives to get together and talk about their problems/issues and perhaps along the way make a deal or two but that's later. Right then, it's about escaping with your peers.
Source Sun Valley Lodge
Better known as the Summer Camp for Billionaires, they needed the break because many - WBD's Zaslav, Netflix' Sarandos, Amazon's Jassey, Disney's Iger, Meta's Zuckerberg, Google's Pichai and others - have had a tough year paring staffs (firings), tearing up/reassembling their organizations and figuring out how they can use the new tech toy unmonitored AI to their advantage.
Studio and tech executives have been under hellacious pressure from Wall Street analysts and stockholders to make positive changes that will improve their organization's free cash flow during a period of unprecedented industry transformation as the industry and world changes all around them and under their feet.
Disney's overhaul (eliminating 7,000 positions) produced cost savings of $5.5B. WBD's pockets of improvement produced similar staffing reductions and savings. Paramount reduced its staffing by 25 percent. Other networks/studios made similar improvements.
At the Allen retreat, Bob Iger - with a two-year contract extension in his pocket - said that his team had identified certain no-growth businesses and was focusing on repairing/improving the company's creative engines.
The entertainment and media industry has changed significantly since 2019 and the usual guidelines and checkpoints that studios/networks previously used don't exist today.
They're working/dealing in new/unfamiliar territories.
John Landgraf's (FX Networks' CEO) Peak TV which he coined to describe broadcast, cable pay TV continues to shrivel as original scripted programming gets replaced by unscripted game, reality and non-fiction shows that are easier/cheaper to produce for the rapidly dwindling day/date viewer base.
At the same time, network's/studio's rapid leap into the ultra-promising direct-to-consumer streaming content environment that Netflix and Amazon pioneered (along with YouTube, Hulu) back in 2007 hasn't gone as smoothly - or as rapidly as Wall Street analysts projected.
Who knew the fickle subscribers wanted/expected a steady stream of new, unique scripted movies/shows to watch when, where and how they wanted or would resort to what MediaPost's Wayne Freeman called Peak Churn - the rapid/continuous hopscotch of streaming subscription?
Buddy Talk - With a new 2-year contract extension, Disney's CEO Bob Iger (l) and Apple's CEO Tim Cook (center) enjoy a quiet discussion with Eddy Cue, Apple's SVP of Internet & services, about who knows what.
Source Bloomberg News
As a result, the new streamers have been consistently bleeding 100s of millions of dollars which has only been exacerbated by the joint strike for higher wages, benefits and more that can only impact their organizations' bottom line, further endangering their $10-50 million salaries.
Initial pain points such as increased pay, protections around the audition process, writing room size, pre-/post production TV series writing compensation, more favorable terms for pension and health contributions, on-camera rate for dancers' rehearsal days and redefinition/increases in residuals have been major issues for a large portion of the 180,000 individuals who want to make a decent living in the largely freelance industry.
Granted, it's a well-defined freelance industry but they still move from one movie/show project to another, always working to keep their work calendar filled.
During th
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