What Price Hollywood? For WGA Contract Talks, History Doesn’t Have to Repeat Itself

Here we are at the precipice of an uncertain yet familiar place.

The question of whether the TV and film industry will be shut down by labor action will be answered one way or another by the time Monday ends on the west coast. In broad strokes, the Writers Guild of America and Alliance of Motion Picture and Television Producers face one of three basic outcomes as the WGA contract expires at midnight PST.

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Behind Door No. 1 – the sides reach a tentative agreement. Door No. 2 — they agree on a short-term extension, which is unlikely but could be anything from 12 hours to 12 days, or more. Door No. 3 – the talks are called off by one side or the other — or both — and picketing ensues in Los Angeles and New York on May 2.

The industry has been here before, many times. Contentious labor talks in Hollywood are rarely settled without the pressure of a contract expiration deadline bearing down. The stakes and the tension feel especially heightened this time around because the pace of change in the industry has accelerated so much in recent years.

It’s become clear over the past few weeks that the WGA and AMPTP are dealing with the repercussions of not having had a full-fledged contract negotiation since 2017 – when a deal was reached about 15 minutes past the midnight PST contract expiration deadline. In the spring and summer of 2020, even after the guild and AMPTP extended the May 1 contract expiration date to June 30, the COVID crisis made it impossible for the sides to engage in a meaningful discussion around complex issues.

This time around, scribes are worried about the survival of screenwriting as a viable profession for the thousands who write for film and television. The leaders of studios, networks and streamers are worried about how to keep profits flowing in the age of streaming.

The issues on the bargaining table at the AMPTP’s Sherman Oaks headquarters have been well documented. Writers at virtually every level are working longer hours at lower wage rates – even though the overall volume of jobs and dollars paid to members of the WGA West and WGA East pay has shot up during the Peak TV decade. Writers are pushing hard to get more money on the front-end of dealmaking because the backend of profit participation, syndication sales and international licensing is disappearing in the age of streaming.

The advent of “mini rooms” in television has created an alternative to the pilot development process that is complex from a compensation standpoint. WGA leaders have been candid about how they didn’t recognize the issues that mini rooms created until they started polling rank-and-file members on their concerns in preparation for bargaining. It sounds contrarian, but the shift to the mini room development format – bringing 2-3 writers together with a showrunner for eight weeks or so to develop scripts and concepts for series – has made it harder for less-experienced writers to break in. Showrunners often lean toward hiring more experienced writer-producers in order to get more done in a short time. The fact that showrunners have so much sway over these decisions – hiring and setting salaries for fellow WGA members – only adds to the complication in finding compromises.

The issue of WGA members working longer periods for lower compensation overall was addressed in the 2017 contract with a “band-aid” approach in the words of a guild member who was involved in those talks. Back then, the industry was just starting to see the first hints of the unintended consequences of studios and streamers demanding long periods of exclusivity for series that only produce 6 to 10 episodes per season.

But in 2017 – before the dawn of Disney+, HBO Max, Peacock and Apple TV+ — those so-called short-order shows were the exception to the traditional TV realm ruled by series that ran at least 13 or more episodes per annual season. Six years later, short-orders are the rule and the old-guard of broadcast network shows (think “Law & Order: SVU,” “Grey’s Anatomy,” “Chicago Med” and “9-1-1″) are the exceptions. The increase in the number of shows that drop all episodes at once in the binge model has also shortened the number of weeks that writers work on TV series, particularly at the junior level.

The discussions between the WGA and AMPTP that began March 20 have left a number of executives on the AMPTP side worried about a growing showrunner drought. Simply put, the younger generation of story editors and staff writers are not getting the level of on-set and on-the-fly experience during production that is necessary to advance to showrunner and executive producer status. When all scripts are written in advance before filming begins, very few need to stay on the payroll to see the show through physical production. When an entire season runs six to eight episodes, there’s no need for a dozen or more writers on staff as was the norm for decades of episodic shows.

The WGA’s remedies for these problems have led some on the studio side to privately grumble about the guild unrealistically trying to turn the clock back to the 1990s, when a hit show was a license to print money. The AMPTP’s position that Hollywood’s largest employers are recovering from the pandemic and unprecedented levels of investment in streaming platforms has writers feeling like the studios want to turn back the clock to the 1950s, before the WGA had such things as residual payments, health care coverage and a pension plan.

The WGA is not alone among Hollywood guilds in feeling squeezed by the winds of change. The WGA has kept much of its focus on addressing the problems in upfront compensation and the issues around mini rooms. The Directors Guild of America is poised to begin its contract negotiations with the AMPTP on May 10. The DGA has made it clear that they are focused on achieving gains in streaming residuals as the lion’s share of TV viewing shifts from linear to on-demand platforms.

The WGA and DGA have long tussled over industry issues (three words: “A Film By”) and jockeyed for position with employers. But the dynamics driving the 2023 round of contract talks may lead to a rare example of the guilds flexing coordinated leverage to combat the common enemy of shrinking paychecks. The WGA can keep a laser-focus on writer-specific issues in its talks, because if the DGA secures a big increase in streaming residuals (word is the DGA is focused on boosting international payments), the WGA and SAG-AFTRA will get a similar benefit through the favored-nations provisions in WGA, DGA and SAG-AFTRA contracts.

In fact, the WGA is in an unusual position this year because the DGA is typically the first of the three guilds to negotiate with the AMPTP when contracts come up every three years. That allows the AMPTP to dicker with the DGA over the basic financial parameters of what they’re also willing to give to WGA and SAG-AFTRA. But in a sign of how touchy and tricky the contract talks are this year, the DGA was not the early bird to the table.

The last time that the DGA was not first to make a deal with the AMPTP, in 2007, the WGA went on strike. Most of the key people who will be in the negotiating room today and Monday are veterans of the 2007-2008 labor action that crippled Hollywood for months. At this moment of unprecedented transformation of an increasingly global content business, recent history should not have to repeat itself.

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