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What made Hollywood go on strike?

BACKGROUNDER | The streaming revolution has upended the entertainment industry’s business model


Lev Radin/Sipa/AP

What made Hollywood go on strike?
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Hollywood’s feeling the heat, but it’s not from a summer scorcher or California wildfire. On May 2, the Writers Guild of America went on strike, and the Screen Actors Guild followed suit on July 14. It’s the first time since 1960—when Ronald Reagan was president of the SAG—that both guilds have been on strike at the same time.

Who’s involved in these strikes? The Writers Guild of America has 11,500 members who work in TV, film, and radio, and the Screen Actors Guild–American Federation of Television and Radio Artists represents 160,000 actors and media professionals. These labor unions create collective bargaining agreements with the Alliance of Motion Picture and Television Producers, a trade association representing ­production companies.

What do the writers want? The streaming revolution upended the entertainment industry’s business model, and the unions argue the old agreements were designed for last century. The WGA wants employment protections and better wages for its members, many of whom have seen their incomes drop as TV series trend toward fewer episodes. The writers also want to keep ­studios from using artificial intelligence to write and rewrite scripts.

What about the actors guild? The actors want salary minimums to reflect recent high inflation, and AI worries them too. They want more rights over their likenesses, whether they’re used to create AI imagery or train AI software.

Aren’t actors overpaid to begin with? A-list performers are well paid and can negotiate their contracts, but working-class actors earn modest incomes. Traditionally, writers and actors could count on residual payments if their shows became hits, but with the decline in box office ticket sales and network viewership, that revenue stream is drying up. Streaming platforms offer them only flat fees.

Why are the producers and studios balking? In recent years, media companies have had lackluster profits. Studios are still recovering from pandemic shutdowns, and the industry hasn’t had a smooth ­transition to streaming, with many companies losing billions of dollars. AI promises to help studios cut costs to boost profits. The issue of residual payments based on performance is especially sticky: The streaming platforms refuse to release viewership data, and without data it’s impossible to know what’s a hit.

How will audiences respond? The strikes have put film production on hold, so audiences shouldn’t expect much new scripted TV this fall. Next summer’s theatrical lineup could also be in jeopardy with some big films delayed until 2025. But audiences seem to sympathize with the WGA and SAG-AFTRA. Gallup says 71 percent of Americans have a positive view of labor unions, the highest that number has been since 1965.

This page has been updated to remove a reference that incorrectly described the Alliance of Motion Picture and Television Producers as a union.

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