Horrors of the Hollywood Strike – Industry Voices: Grebb

Michael Grebb Industry Voices

With Halloween approaching, it’s the perfect time to conjure up some scary nightmare scenarios. And what better setting than Hollywood for a horror movie in which innocent victims find themselves trapped in a dungeon with no escape? That might describe the ongoing, seemingly never-ending, labor dispute that has gripped the entertainment industry for months - although separating victims and villains can depend on who you ask.

First the writers struck for 148 days, finally ratifying a new deal on September 27. But the actors' strike that started on July 14 has continued to this day, with no end in sight after studios balked at funding a nearly $500 million annual pool tied to their number of streaming subscribers. 

The proposed payments would go to a jointly administered fund, which would redistribute money to SAG-AFTRA members under a still-undefined formula presumably based on viewership. This supplemental fund would be a radical departure from the norm, but the last several years haven’t been normal. The business has turned upside down. Many creatives can’t even make a living anymore. And the studios haven’t really figured out how to consistently make a profit on streaming either. 

Still, the studios’ decision to walk away from contract talks (at least temporarily) has greatly increased the chance that this dispute will cause disruptions well into the new year. The holidays are approaching, and even if a deal suddenly materializes, it’s unlikely any productions could get up and running before turkey and mistletoe disrupts everyone’s schedules. As for Halloween, it’s always fun to dream up dystopian landscapes crawling with zombies, so let’s work up at least one hypothetical nightmare scenario: 

What if the studios just went non-union? 

Sure, it sounds fantastical, impossible even. Hollywood has been a union town for decades, with pay minimums, healthcare funds, residual rules, and other practices baked fully into the entertainment cake. Plus, any attempt by one or more studios to declare their non-union status would create a public relations disaster likely followed by lawsuits from the unions and the National Labor Relations Board, which could view any attempt to wriggle out of these norms as a violation of “union busting” laws. Even if this only affected actors, it’s likely that members of the Writers Guild of America, Directors Guild of America, the International Alliance of Theatrical Stage Employees, and others would refuse to work under their contracts out of solidarity. Finding people with the necessary skills to cross virtual picket lines at that point would be difficult to impossible. 

But let’s keep the nightmare going. Let’s say the studios just ate the temporary PR and Wall Street hits and recast themselves as mavericks open for business with any non-union actor, writer, director, sound tech, or camera operator looking for the shot of a lifetime. Anyone who took them up on it would be blacklisted for life, never able to join an existing union if the studios ever changed their minds or the courts forced them to re-engage. But with so many dreamers desperate for work, how many might take that risk for one shot at the Hollywood dream?

Even if the studios found themselves with few takers, their massive backlog of content creates a unique content cushion. According to One Touch Intelligence’s StreamTRAK video intelligence service, more than 2,000 original or returning series have premiered across streaming, cable, and broadcast over the last year alone. Roughly half of those premieres came from SVOD providers whose libraries can run well into the six figures. Recall that the first season of “Yellowstone” has been a ratings hit for CBS this fall despite being a rerun of a five-year-old show. That’s crazy. But it’s also a sign of the times. 

Amid so much content available to feed the beast, imagine under our hypothetical nightmare that select non-union projects started moving forward. Forget the scabs. Worried that their careers could pass them by, even some union members might start to crack, choosing work over solidarity. And even if those NLRB lawsuits got all the way to the U.S. Supreme Court, think about the court’s current makeup, and ask yourself whether it would turn out well for the unions. A Supreme Court decision under this scenario might not only weaken the union system in Hollywood but also set precedents that weaken unions everywhere, in every industry. That would be like Freddy Krueger getting a hold of the nuclear codes. 

It also wouldn’t be a popular situation for the public at large. In August, amid the dual Hollywood strikes, a Gallup poll found that two-thirds of respondents approve of labor unions, the fifth straight year that union support has surpassed historical averages. Even more interestingly, two-thirds also specifically said they support the SAG-AFTRA strike, with even more (72%) supporting the WGA strike when it was still in effect this summer. In case you hadn’t noticed, Hollywood likes to keep things copacetic with the general public to, you know… sell movie tickets and streaming subscriptions and stuff. That’s just one more reason the above nightmare scenarios are highly unlikely (but still fun to contemplate). 

And here’s the other thing: despite any recent frustration during contract negotiations, those who run the Hollywood studios are largely pro-union for several reasons. Collective bargaining helps smooth over day-to-day dealings with creatives, as pay minimums and other rules ensure fairness on both sides and help keep individual talent negotiations from dragging on forever. But the last few months have been a big test of everyone’s fortitude. And they have exposed deep disagreements between studio execs whose businesses face big challenges and most creative union members whose middle-class existences have evaporated amid the streaming wave. 

This particular movie offers few black-and-white narratives. Both sides make valid points about a changing industry as they mourn the loss of business models that fed everyone well for decades. But we should also remember that when backs are up against the wall, nightmare scenarios sometimes find their way into the real world. It’s everyone’s job to make sure the above Halloween horrors don’t become a reality show - although we hear bachelor Freddy Krueger is ready for love.

Michael Grebb is Vice President and Lead Analyst for One Touch Intelligence, which provides market intelligence and industry analysis services for leading companies in the media and telecommunications space. The One Touch Intelligence STREAMTRAK series is a complimentary service offering industry professionals insights and context around developments in the digital media sphere.

Industry Voices are opinion columns written by outside contributors — often industry experts or analysts — who are invited to the conversation by StreamTV Insider staff. They do not necessarily represent the opinions of StreamTV Insider.