Today, Explained - Hollywood writers are ready to strike

Episode Date: April 18, 2023

TV and film writers just voted to authorize a strike, which could leave studios without fresh scripts as soon as May 1. Bloomberg business reporter Lucas Shaw explains. This episode was produced by Hady Mawajdeh, edited by Matt Collette, fact-checked by Laura Bullard, engineered by Patrick Boyd, and hosted by Noel King. Transcript at vox.com/todayexplained Support Today, Explained by making a financial contribution to Vox! bit.ly/givepodcasts Learn more about your ad choices. Visit podcastchoices.com/adchoices

When 97.85% of members in the Writers Guild of America voted to authorize a strike yesterday, people in Hollywood and people who watch Hollywood carefully were not shocked. You know, Hollywood executives, screenwriters, agents, pretty much everyone have seen a strike as inevitable for months now. Hollywood writers say their pay and benefits haven't kept pace with the times and that the rise of streaming has disadvantaged them even more. And if a deal is not met on or before May 1st, they'll stop work. There's always a chance that they reach a last minute deal, you know, but I would say a pretty small minority of my sources, maybe, you know, 10, 15 percent think that there'll be a deal before. If there's not a deal, the last time a real strike happened was in 2007, and it did fundamentally

change what we watch. That's coming up on Today Explained. The all-new FanDuel Sportsbook and Casino is bringing you more action than ever. Want more ways to follow your faves? Check out our new player prop tracking with real-time notifications. Or how about more ways to customize your casino page with our new favorite and recently played games tabs.

And to top it all off, quick and secure withdrawals. Get more everything with FanDuel Sportsbook and Casino. Gambling problem? Call 1-866-531-2600. Visit connectsontario.ca. It's Today Explained with about 12 days before the Writers Guild and studios need to come to some sort of an agreement. We called Lucas Shaw, who covers media and entertainment for Bloomberg. Lucas also writes a weekly newsletter called Screen Time. Lucas, what do the writers want? I mean, the simplest is obviously they want to get paid more, right?

That's what almost any labor dispute is about. The Guild argues that the average salary for their writers has declined over the last decade. If you adjust for inflation, it's down more than 20%. Oh. And more and more people are working for the minimum pay covered by the deal. Because the way a lot of this works, right, is that a writer in a room gets paid the minimum salary depending on what kind of work they do and their seniority and such. Here's the deal. The offer is scale.

And if you stay on top of your tutoring duties, I will even consider letting you sit in on the rewrite. But if the answer is no, tell me now so we can move on. Yes. I mean, if that's what the deal is, then yes. I don't even have to think about it. Yes. A lot of people get paid or kind of negotiate a more direct deal for more money. That's what happens with, you know, a really big writer, producer,

or a showrunner when they sell a show. You know, they're not getting paid whatever the minimum is. They're getting paid millions of dollars. Ryan Murphy, the name behind Fox hits, including American Horror Story, American Crime Story, Glee, going over to Netflix. Reported deal, five years, $300 million, and it starts July 1st. But the average person on a show is generally getting paid whatever the minimum is, and they feel that that's too low. There's also all sorts of work that they feel like they maybe don't get paid for. You know, writers have to pitch projects, do things like that. They often don't get paid for it.

And there's just been a bunch of sort of new developments, in large part due to this streaming boom that we've lived through, that have changed the way that they get paid, that they feel have been to their disadvantage. So, for example, the studios have this thing called mini-rooms. Now, a mini-room is paying writers to help them prepare to write a show versus actually write on the show. And that would be fine, except it's pretty much the exact same work

and definitely the exact same amount of work, except writers are paid less. They don't like some of the limitations on what other projects they can work on. You know, they have a long list of demands that they're trying to work through. You said salaries adjusted for inflation went down. There is so much happening in TV. There's so much happening in film. How is that possible? Well, if you think about how writers or how the TV business works, it used to be that your main goal was to be on a broadcast TV show. Sometimes you want to go where everybody knows your name. The season's going to run 20-plus episodes.

It's probably going to last for at least a few seasons, sometimes longer. That means that you're going to get a chance maybe to write an episode or two, or at least you're going to get trained. And by, say, season three or four, you get to write. It means you're probably going to get some time on set. There's a whole apprenticeship model. If a show is successful enough and it gets licensed to someone else in what's called syndication, those reruns get re-aired by another network. You are going to get a cut of that if you wrote any episode. Just TV felt stable, and there was sort of more upside in it in the case of success. Now you have streaming services that

are by and large making fewer episodes per season. The shows don't last as long, and they are taking just as long. And so again, you're doing maybe the same amount of work, but the opportunity for getting paid for a credit for a show is less. And the odds are that you're just in general not getting paid as much as it seems like from the outside. Because I get your question. I've wondered this myself, too. We've seen this massive expansion in the number of shows being produced, right? I think more than 500 scripted shows a year. But if you look at the total number of episodes, it's higher, but it's not as significant because the seasons are shorter. And just the model for people getting paid is different. And so not everyone is benefiting. The people who have benefited the most from that are the people at the very top. I write for a show called Abbott Elementary that's on ABC, which is a traditional network. But the next day we're on Hulu. And a little bit after that, we're on HBO Max and Disney+. So the amount for a re-air on the network is $13,500. And the amount that you're paid for that episode being on new media streaming is $700. The writers would seem to have a very

rational and strong argument here. What are the studios saying in response? You know, the studios, I think, acknowledge that there are some issues that they need to deal with and they need to compensate the writers a bit more. But they'd also point out a few things. One is the fact that there's more getting made means that there are more writers who kind of get a chance than ever before. I don't know that this is going to be their central talking point, but I think you could say that there are, you know, more female writers, more writers of color who've gotten opportunities over the last few years than they had previously. The bigger argument that they'd likely make is that streaming services now pay writers as though every show is a hit. One of the big changes in the model is, you know, Netflix came around and

they said, we're going to pay more upfront and not have to pay on the back end because they buy out most of the rights to a show. So there isn't that kind of syndication gravy train coming at the end. And most shows are not hits. And so that does mean that a lot of people, you know, get paid more upfront or more for a show than they might otherwise have been paid. But, you know, perhaps most important, at least for the studios, is that they're saying they're all suffering because Wall Street has sort of soured on these streaming services ever since early last year when Netflix reported a slowdown in its subscriber growth. You know, the stock for all these big companies have gone down. I've been focused on shares of Warner Brothers Discovery for some time. It's been a sad story

if you own the stock. Pretty much every major entertainment company has fired staff in the last year, has vowed to cut costs. We don't need to cry poor for these companies. They still are making a lot of profit, but their streaming services, these things they've spent a lot of money on, are losing billions and billions of dollars. And so they say, you know, now is not the time to have to drastically change the model and pay writers a lot more money. So if a strike does happen on or around May 1st, what does that mean for what we see? Like as a television consumer or a streaming consumer, what does this mean for my shows? Well, the immediate impact will be limited to those that are constantly producing new episodes. So like the late night shows are some of the first to go off the air.

Stephen Colbert, The Daily Show, that's usually something that's hit very quickly. We'll see if those programs have sort of developed any contingencies for this scenario, knowing what has happened before. For those who mostly stream their TV, I don't think they'd see an effect for, really for a while,

because streaming services tend to stockpile projects. So, you know, Netflix, we experienced this a little bit during the pandemic where for the first several months, Netflix had plenty for people to watch. And it wasn't for sort of six or 12 months where we started to feel, oh, maybe the, you know, maybe the slate's a little thin. What is a popular TV show that people talk about now? And they say, look, if this goes on six months down the line, this really will mean something for XX show that everybody is really into right now. Well, think about a show like Abbott Elementary, which is a popular show on ABC. Janine, that performance was on point.

And they say you Penn students can't stick. Wait, who says that? I tend to watch it on Hulu. Same. Those shows that air on broadcast, you know, the new seasons debut often in the fall or in the mid-season, which is sort of January. The writing on that happens in the months leading up to that and then continues during the course of that show. It's a little different from streaming where they often sort of get the whole project done months before it's supposed to be released. And so if this strike were to happen and if it were to drag on, the chances of the next season

of that show coming on kind of as expected would be significantly lower. Most people think school starts when the kids get here, but it actually starts now at development week. Teachers prep for the year. We get ready, get our curriculum. It's the calm before the storm. It's very zen, actually. You know, here's a question I imagine some of the writers are asking themselves. There is a lot of TV out there. There's actually a lot of very good TV out there, including a lot that people just don't have time to get to. If we don't see new shows coming down the pipeline,

are we really going to be missing all that much? Or do you think consumers are likely to say, okay, there's no third season of Abbott, a show that I truly love. I think I'm going to go and watch back episodes of Secession. Look, I would welcome a few months to go back and catch up with all the shows I've missed. I keep a long list on my Apple Notes or my iPhone notes of shows that I haven't watched that I'd like to at some point. I don't know that the average viewer thinks about it that way. I mean, by and large, the most popular programs on streaming are new series, right? You know, more people are watching new episodes of The Night Agent on Netflix or The Mandalorian on Disney Plus than they are anything old.

This is the way. There are a few exceptions, shows like Friends and The Office that people go back and watch a ton of. The product, the prognol. My son returns. But look, there's no shortage of television for people to watch on these streaming services. And I think some of the studios, you know, to our earlier conversation about their response to the writer's demand, some of these studios would be more than happy to save money over a few months

if they don't have to spend a bunch and just ask people to watch older programs. Seen it. Bad. Boring. Saw it on the plane. Rerun. Rerun.

Ugh. Okay, this is really interesting. So what you're saying is the studios are not going to be thirsty for content. The writers presumably have money saved because they've been preparing for this. The writers presumably have money saved because they've been preparing for this, and audiences have enough stuff to watch until they die. Who actually loses out here?

While studios would be okay not having to spend a bunch of money for a couple of months because Wall Street is nervous about how much money they're losing on these streaming services, the best way to sign someone up to one of their streaming services is still to have something new, right? You know, HBO Max, which is about to relaunch as Max in May. One of the things that they need to ensure that more people sign up for their service, because that's why they're doing it, they want more people to be using Max more frequently, is they need fun hit shows, new hit shows for people to watch. And while they may have it for a little bit, if they don't have those later this year, that's a problem for them.

Now, in terms of other losers, there are a lot of people who work on television shows who would suffer. You know, the last time there was a writer's strike, the economy in Los Angeles was estimated to lose more than $2 billion. You think about the number of shows being produced, the number of movies being produced. It's not just rich people arguing with rich people. There are caterers, there are hairstylists, there are makeup artists, there are drivers and truckers and all these people built around the production. And it's really not just in Los Angeles either. The way that the production business has changed over the last several decades.

You know, Atlanta is a major production hub. New Orleans is a major production hub. New York, Chicago, Vancouver, Toronto, North Carolina, certainly, you know, London, some other places that may not feel it, but do welcome American productions. And you have just, you know, a lot of workers who've built up around those production hubs

who would suddenly not have a job for a while and would have to find something else to do. Coming up next, we're seeing lots of comparisons to the last big writer's strike in 2007. We're going to tell you how that one went down and how it changed and it did what's on your TV. Support for Today Explained comes from Aura. Aura believes that sharing pictures is a great way to keep up with family. And Aura says it's never been easier thanks to their digital picture frames. They were named the number one digital photo frame by Wirecutter. Aura frames make it easy to share unlimited photos and videos directly from your phone to the frame. their digital picture frames. They were named the number one digital photo frame by Wirecutter.

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And it's, yeah, and possibly worse with all the late- night shows off the air. Americans have been forced to read books and occasionally even speak to one another. Which has been horrifying. It's Today Explained. I'm Noelle King. We're back with Lucas Shaw of Bloomberg and of the Screen Time newsletter.

Lucas, tell me about the last big strike. So the writers went on strike in 2007. It lasted 100 days. It stretched into 2008. Lucas, tell me about the last big strike. But that was the strike that people remember vividly and sort of in part earned the writer's reputation for being kind of the most activist of the big Hollywood labor unions. You know, that was a different time in Hollywood. It was the very beginning of streaming. 2007, 2008, that was the debut of Netflix's streaming service. It was the debut of Hulu. It was the debut of Hulu. It was the debut of Amazon streaming service. It was so brand new, and writers were as preoccupied with DVDs and getting paid from those as they were from this oncoming revolution in pop culture.

It's such a waste of time. He chose money over power. In this town, a mistake nearly everyone makes. Money is the McMansion in Sarasota that starts falling apart after 10 years. Power is the old stone building that stands for centuries. I cannot respect someone

who doesn't see the difference. What was the strike about in 2007? What were the issues then? So part of it was residual payments or fees for those DVD sales. You know, you think back then, DVDs, you moved more than a billion units a year. I think studios would make a couple hundred million dollars just from DVD sales for their biggest titles. And writers felt like they did not get enough of that money, much as they now feel they don't get enough from streaming.

There was also a lot of concern about the internet and making sure that they were adequately prepared for that. So at the time, the Writers Guild didn't have jurisdiction or power to negotiate over those. So that was one of the things that they were pushing for. And they also wanted to make sure that they were getting paid in some way for kind of internet transactions, internet streaming, because again, it was so new that they weren't really getting paid for any of that. What ended up happening? Take me through it a little bit.

Well, there was a pretty long labor dispute where you had months of major writers petitioning at studios protesting. They know damn well they're in the wrong here. The logic would be obvious to a child. A novelist receives fair royalties for their books. A musician receives fair royalties for their songs. Screenwriters deserve fair royalties for their work. You had a complete shutdown in production. You know, we talked about there was no late-night television for a long time,

and there was a huge increase in reality TV. You think back in the history of reality, yes, there was the real world in the 90s and, you know, Survivor and Who Wants to Be a Millionaire came around around the turn of the century, but there was just a dramatic increase

in reality TV produced coming out of that because that was one thing that these networks could put on the air. NBC created Celebrity Apprentice, the spin-off of The Apprentice. I'm sure that's one of your favorite shows. Big Brother came on the air. You think back, there was actually a big labor dispute in the late 80s, and that is part of what gave birth to Cops,

I'm sure another one of your favorite shows. And so strikes have historically been the cause of a big increase in reality TV. And then they reached a deal in early January, but only after a lot of fighting back and forth. The writers mostly ended up kind of giving up some of their complaints on the DVDs, which in retrospect was okay. They did get some major gains on streaming, just in getting the Writers Guild to have the jurisdiction to negotiate, and also this structure for residuals or fees because one of the things for writers

is not just getting paid up front, but getting paid sort of in success and in relicensing. Observers say there was compromise on both sides, but the studios gave the most. And today, a new contract was presented to writers, first on the East Coast. I believe it's a good deal. I am going to be recommending this deal to our membership.

What I hear you saying is the writers mostly won in 2007. Is that right? I think it was mixed. You know, they certainly got more concessions, I think, than they would have had they not struck. And that's what some members of the Guild are looking back on now as inspiration. Because I do think there's some

debate in the entertainment business over, you know, how effective these actions are. When the writers had this fight with their agents a few years ago, where they have ceremonially fired all their agents and only later did they reach a new deal, they were fighting over this thing called packaging, which had to do with how agencies kind of make money from their work. And I think there are a lot of writers who look back on that fight and wonder if they actually got everything they wanted out of it. How did that agreement, what are we talking, 16 years ago, 15, 16 years ago, how did that shape the Hollywood that we have today? Did it?

First of all, it shaped what people watch in that it did lead to this dramatic increase in the production and output of reality TV, which has only increased since then. You know, you look at Netflix and people were, you know, going crazy on Sunday evening because the live stream of the Love is Blind reunion did not function. And Love is Blind and all these reality shows have become such a big draw, even for Netflix and the streaming leader, which started with normal dramas. It also, you know, it set the pay scale for what we see today in streaming and how writers are compensated. And this has been, you know, an ongoing dispute, I would say, over the past decade between the creative community in Hollywood and the streaming services. You know,

when streaming services first came around, Netflix told people, we'll pay you a bunch of money up front. You get paid like it's a hit. And by the way, you don't have to worry about how successful it is. And I think everyone was, you know, kind of relieved by that, right? Because there was such pressure they felt if you had a show on broadcast to look at the ratings and people would wake up first thing Tuesday morning. And so did my show hit a 5.7 or a 5.9?

And what does that mean? And Netflix absolved them of having to worry about that at all. But now that streaming has become kind of the primary way, they realize that

some of those models don't work so well for them. They want to know how their projects did and they want to get paid in success. You know, there's this feeling of information asymmetry.

But they're now negotiating with a bunch of companies that have set the practice of not needing to disclose data. And if you let companies get away with that, they're probably not going to want to change the practice. Are there any other similarities between 2007 and today? Well, I think there's similarities in that the writers feel like they're not getting paid enough. That's the obvious one. There is a new technology that is similarly scaring people now as streaming did then in artificial intelligence. I don't know that AI is going to dramatically reshape the entertainment business as much as streaming did. It's obviously too soon for us to know that. There are some people who certainly

think it will. If the central part of this negotiation is related to minimums and residuals and mini rooms and all these things that govern sort of the nuts and bolts of making a TV show and how writers are paid, artificial intelligence is that other thing where they're going to make sure there's some kind of clause in the deal that protects them, unless they view that as something they can kick down the road and get what they want on the core issue. Because that's, to me, one of the most interesting dynamics in this whole dispute is the writers are asking for a lot of different changes to the system, and there's going to have to be some compromise. That, again, is a similarity last time where there were a lot of concerns about DVDs,

also a lot of concerns about streaming. And in any negotiation, you just got to pick and choose a little bit. And it seems like the other big dynamic here is you almost want to be able, if you're in the writer's position, you almost want to be able to predict the future. I mean, even two years ago, we as humanity were not worried about AI the way we are now. And so if you lock in changes for a set period of time, well, in six months, those changes could be outdated. Yeah, you're absolutely right. Look back to the deal that they struck in 07, 08. The residuals that the writers receive for streaming,

which is sort of paid for a project getting re-aired, they get paid for how long a show is on or how recently it was on, and how many episodes. But they don't really get paid for how many viewers it has, or anything related to the success of a show. Some of it, I'm sure, they anticipated and couldn't get, and some of it, they failed to anticipate just how much it would change. And that's always the tricky thing with these, is you want to negotiate a deal that gives you some wiggle room going forward,

or you end up striking 15 years later. That was Bloomberg's Lucas Shaw. And full disclosure, a lot of Vox's staff, including producers, engineers, and fact-checkers, are part of WGA, the Writers Guild of America, though they are not involved in this vote or in the strike. Today's episode was produced by Hadi Mouagdi and edited by Matthew Collette. It was fact-checked by Laura Bullard and engineered by Patrick Boyd. I'm Noelle King. It's Today Explained.