Editorial: Hollywood is the backbone of L.A.’s economy. It’s a relief there’s an end in sight to the strikes
Whew. There’s an end in sight for one of the two historic Hollywood strikes.
Nearly five months after writers walked off the job, the Writers Guild of America announced Sunday a tentative deal with the Alliance of Motion Picture and Television Producers, which includes Netflix, Amazon, Apple, Disney, Warner Bros. Discovery and NBCUniversal. The hope now is that an agreement with the actors union isn’t far behind and Los Angeles’ entertainment industry — and the untold numbers of local businesses that rely on it — can get back to work soon.
The last few months have been extraordinarily difficult for the people who make Hollywood magic happen and those whose livelihoods depend on a thriving entertainment industry. The WGA strike began May 2, with SAG-AFTRA members joining the picket lines on July 14. It was Hollywood’s first double strike in 63 years, but the effects were felt beyond those unions. Crew members have also been out of work with production largely shut down. Businesses that rely on industry spending, including restaurants, hotels and service providers, have been hurt as well.
The last strike cost the local economy $2.1 billion and 37,700 jobs. Los Angeles has an interest in seeing a fast and just resolution in the standoff between writers and the studios.
By one estimate, California’s economy has lost about $5 billion as a result of the strikes.
While there are few specifics on what’s included in the proposed three-year contract for film and television work, WGA leaders called the deal “exceptional,” with “meaningful gains and protections for writers in every sector of the membership.” The guild’s 11,500 members still have to vote on the agreement, which would increase pay and residual payments for streaming shows and impose rules on the use of artificial intelligence, which emerged as a significant job protection issue for writers and actors.
Some actors are subjected to full body scans. Screenwriters worry about their work being digitally repurposed. Those striking against the studios rightly demand stricter controls over artificial intelligence.
The strikes put a spotlight on how the digital revolution is transforming Hollywood, for better or worse. Not too long ago, viewers were basking in a new Golden Age of Television as studios went on a spending spree to launch their streaming services with new programs. The strikes revealed, however, that the streaming model has real financial downsides for people in the business.
Studios are now facing pressure from Wall Street to cut costs and deliver reliable profits. For writers and performers, the shift has upended traditional compensation, with streaming programs offering fewer episodes or paychecks per series, “mini rooms” that employ fewer writers and pay less residuals (fees for re-aired shows), making it harder to earn a middle-class living.
A profitable new normal has yet to reveal itself in the face of big tech changes, including AI. But to produce content, you will always need creators.
The WGA and SAG-AFTRA contract negotiations have been seen as a pivotal moment, setting the course for the industry for the foreseeable future. No wonder both sides dug in for so long.
That the WGA and the studios were finally able to reach an agreement is a good sign that compromise is possible. The entertainment industry is an economic engine for Los Angeles and California; the region has a collective interest in the studios’ success and the continued livelihoods of the people who make Hollywood possible.
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