TV Studios In Strike-Preparation Mode Ahead Of WGA Contract Negotiations With Overall Deals At Stake & Streamers As Wild Card

Nellie Andreeva

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With the end of the WGA’s current film and TV contract with AMPTP only five months away and no talks on the horizon, the TV studios are starting to prepare for a potential strike.

It has become standard procedure for the major TV companies to make arrangements for a possible work stoppage every time the writers guild’s contract nears an end and there are major issues on the table. That is the case in 2020 when a larger share of the companies’ streaming revenues is expected to be one of the biggest bones of contention.

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Some of the current preparations are the type of precautionary measures studios take when anticipating a possible strike. Writer Craig Mazin summed them up in this week’s edition of his podcast with John August, who is a member of the WGA’s negotiating committee for the contract talks.

“Predictably, what they do when they think there’s going to be a strike, they are going to hire a lot of people – rush, rush, rush – and set dates for delivery before the termination of the agreements,” Mazin said. “And then, if there is a strike, there is; and if there isn’t, then they’ll deal with that backlog, like they did when we almost struck in 2014.”

Indeed, I hear that TV studios have been banking extra scripts for their ongoing series where they can. That would keep a series in production in case of a writers strike and, if the stoppage is short, a show may stay in continuous production. Stockpiling scripts also helps if studios, anticipating a prolonged strike like the 2007-08 one which lasted 100 days, shut down production. They can gear up faster at the end of the strike if they have finished scripts.

There are also new wrinkles to the standard preparations this time around as the TV business has evolved over the past five years.

Once a rarity, limited series are now very popular driven by streamers’ appetite for the format. I hear some studios have ramped up development of limited series whose model involves having the scripts written and ready before getting a green light. This would allow studios to have more limited series in production to make up for any ongoing series that would need to shut down in case of a lengthy strike.

When the 2007-08 writers strike hit, the TV industry was at a peak for overall deals. Using the force majeure provision, the studios went through their rosters and canceled a slew of overall pacts, saving tens of millions of dollars, a large portion of them coming out of writers’ pockets.

The strike disseminated the overall deal market, dramatically pushing down volume and prices. It took years for it to recover.

We are now in an overall deal peak the likes of which we have not seen. Fueled by deep-pocketed streamers, there has been an unprecedented arms race for talent, with top showrunners commanding 10-figure overall deals.

I hear TV studios are currently examining their financials and running business projections of what a strike could cost them. As part of the evaluation process, they are also looking at their overall deal roster. If there is a work stoppage, there likely will be another purge of pacts, possibly bringing an end to what is being described as an overall deal bubble.

The WGA is heading into the AMPTP negotiations under unprecedented circumstances — the guild is currently in a standoff with the major talent agencies. That prompted WGA West president David A. Goodman to issue a warning to the TV studios last month that they should not think that they can “push us around because they think we’re ‘tired’” of battling the agencies, or that the agency campaign has weakened the guild’s resolve to fight the studios for a fair contract “if they pushed us to a strike.”

In their fight, the WGA plans to use to its advantage the rise of streamers, which is adding a new angle in the contract negotiations. Most major TV entertainment companies members of the AMPTP, including Disney, WarnerMedia and NBCUniversal, are launching streaming platforms to take on incumbents like Netflix and Amazon and upstarts like Apple TV+. As part of established entertainment congloms, Disney+, HBO Max, Peacock and Disney-controlled Hulu will be impacted by a possible work stoppage, while their counterparts may not be.

“Though companies like Netflix and Apple have to adhere to the MBA if they want to use Guild writers, those companies are not represented in the AMPTP negotiations,” Goodman said last week. “The AMPTP companies understand that, if they pushed us to a strike, the threat that Netflix or another company would make an interim deal and keep producing new product is very real. The billions that the AMPTP companies have invested in their new streaming services would be at risk.”

Netflix, mostly an observer the last time, could play a key role in the contract negotiations this time around.

The streaming giant announced itself on the union negotiations scene this past summer when it cut its own film and TV contract with SAG-AFTRA. Netflix may shake up the status quo in a major way if the company bypasses AMPTP and makes a deal with the WGA.

While the strike drumbeat is getting louder, a work stoppage is not inevitable, Mazin and August stressed this week. Now the writers need to get the message to the studios.

“Regardless of what is true or real, everyone, that employs us, is convinced there’s going to be a strike, and they are acting accordingly,” Mazin said. “So if we want them to stop acting like that, I suppose we could do something.”

 

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