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--:-- Noelle King: When 97.85% of members in the Writers Guild of America voted to authorize a strike yesterday, people in Hollywood and people who watch Hollywood carefully were not shocked. You know, Hollywood executives, screenwriters, agents, pretty much everyone have seen a strike as inevitable for months now.
--:-- Noelle King: Hollywood writers say their pay and benefits haven't kept pace with the times and that the rise of streaming has disadvantaged them even more. And if a deal is not met on or before May 1st, they'll stop work.
--:-- Noelle King: There's always a chance that they reach a last-minute deal, you know, but I would say a pretty small minority of my sources, maybe, you know, 10, 15 percent, think that there'll be a deal before.
--:-- Noelle King: If there's not a deal, the last time a real strike happened was in 2007, and it did fundamentally change what we watched. That's coming up on Today Explained.
--:-- Noelle King: Support for Today Explained comes from Adio. Adio is an AI-native customer relationship management platform that Adio says is built for the next era of companies.
--:-- Noelle King: Having a night out with your friends is awesome. Dealing with hangovers sucks. Meet Senorita, the THC-infused margarita that lets you skip the booze but keep the vibe.
--:-- Noelle King: It's today explained with about 12 days before the Writers Guild and studios need to come to some sort of an agreement. We called Lucas Shaw, who covers media and entertainment for Bloomberg. Lucas also writes a weekly newsletter called Screen Time.
--:-- Lucas Shaw: Lucas, what do the writers want? I mean, the simplest is obviously they want to get paid more, right? That's what almost any labor dispute is about.
--:-- Noelle King: The Guild argues that the average salary for their writers has declined over the last decade. If you adjust for inflation, it's down more than 20%.
--:-- Lucas Shaw: And more and more people are working for the minimum pay covered by the deal. Because the way a lot of this works, right, is that a writer in a room gets paid the minimum salary depending on what kind of work they do and their seniority and such.
--:-- Noelle King: The offer is scale, and if you stay on top of your tutoring duties, I will even consider letting you sit in on the rewrite. But if the answer is no, tell me now so we can move on.
--:-- Lucas Shaw: Yes. I mean, if that's what the deal is, then yes. I don't even have to think about it yet.
--:-- Noelle King: A lot of people get paid or kind of negotiate a more direct deal for more money. That's what happens with, you know, a really big writer, producer, or a showrunner when they sell a show.
--:-- Lucas Shaw: You know, they're not getting paid whatever the minimum is. They're getting paid millions of dollars. Ryan Murphy, the name behind Fox hits, including American Horror Story, American Crime Story, Glee, going over to Netflix, reported deal, five years, $300 million, and it starts July 1st.
--:-- Noelle King: But the average person on a show is generally getting paid whatever the minimum is, and they feel that that's too low.
--:-- Lucas Shaw: There's also all sorts of work that they feel like they maybe don't get paid for. You know, writers have to pitch projects, do things like that. They often don't get paid for it.
--:-- Noelle King: And there's just been a bunch of sort of new developments, in large part due to this streaming boom that we've lived through, that have changed the way that they get paid that they feel have been to their disadvantage.
--:-- Lucas Shaw: So, for example, the studios have this thing called mini-rooms. Now, a mini room is paying writers to help them prepare to write a show versus actually write on the show.
--:-- Noelle King: And that would be fine, except it's pretty much the exact same work and definitely the exact same amount of work, except writers are paid less.
--:-- Lucas Shaw: They don't like some of the limitations on what other projects they can work on. You know, they have a long list of demands that they're trying to work through.
--:-- Noelle King: You said salaries adjusted for inflation went down. There is so much happening in TV. There's so much happening in film. How is that possible?
--:-- Lucas Shaw: Well, if you think about how writers or how the TV business works, it used to be that your main goal was to be on a broadcast TV show.
--:-- Noelle King: Sometimes you want to go where everybody knows your name. The season is going to run 20 plus episodes. It's probably going to last for at least a few seasons, sometimes longer.
--:-- Lucas Shaw: That means that you're going to get a chance maybe to write an episode or two, or at least you're going to get trained and by, say, season three or four, you get to write.
--:-- Noelle King: It means you're probably going to get some time on set. There's a whole apprenticeship model.
--:-- Lucas Shaw: If a show is successful enough and it gets licensed to someone else in what's called syndication, those reruns get re-aired by another network, you are going to get a cut of that if you wrote any episode.
--:-- Noelle King: Just TV felt stable, and there was more upside in it in the case of success.
--:-- Lucas Shaw: Now you have streaming services that are by and large making fewer episodes per season the shows don't last as long and they are taking just as long and so again you're doing kind of maybe the same amount of work but the opportunity for getting paid for a credit for a show is less and the odds are that you're just in general not getting paid as much as it seems like from the outside.
--:-- Noelle King: Because I get your question I've wondered this myself too it we've seen this massive expansion and the number of shows being produced, right? I think more than 500 scripted shows a year.
--:-- Lucas Shaw: But if you look at the total number of episodes, it's higher, but it's not as significant because the seasons are shorter.
--:-- Noelle King: And just the model for people getting paid is different. And so not everyone is benefiting.
--:-- Lucas Shaw: The people who have benefited the most from that are the people at the very top.
--:-- Noelle King: I write for a show called Abbott Elementary that's on ABC, which is a traditional network. But the next day, we're on Hulu. And a little bit after that, we're on HBO Max and Disney+.
--:-- Lucas Shaw: So the amount for a re on the network is one thing and the amount that you paid for that episode being on new media streaming is another.
--:-- Noelle King: The writers would seem to have a very rational and strong argument here.
--:-- Lucas Shaw: You know, the studios, I think, acknowledge that there are some issues that they need to deal with and they need to compensate the writers a bit more.
--:-- Noelle King: But they'd also point out a few things. One is the fact that there's more getting made means that there are more writers who kind of get a chance than ever before.
--:-- Lucas Shaw: I don't know that this is going to be their central talking point, but I think you could say that there are, you know, more female writers, more writers of color who've gotten opportunities over the last few years than they had previously.
--:-- Noelle King: The bigger argument that they'd likely make is that streaming services now pay writers as though every show is a hit.
--:-- Lucas Shaw: One of the big changes in the model is, you know, Netflix came around and they said, we're going to pay more upfront and not have to pay on the back end because they buy out most of the rights to a show.
--:-- Noelle King: So there isn't that kind of syndication gravy train coming at the end. And most shows are not hits.
--:-- Lucas Shaw: And so that does mean that a lot of people, you know, get paid more upfront or more for a show than they might otherwise have been paid.
--:-- Noelle King: But, you know, perhaps most important, at least for the studios, is that they're saying they're all suffering because Wall Street has sort of soured on these streaming services ever since early last year when Netflix reported a slowdown in its subscriber growth.
--:-- Lucas Shaw: You know, the stock for all these big companies have gone down. I've been focused on shares of Warner Brothers Discovery for some time. It's been a sad story if you own the stock.
--:-- Noelle King: Pretty much every major entertainment company has fired staff in the last year, has vowed to cut costs.
--:-- Lucas Shaw: We don't need to cry poor for these companies. They still are making a lot of profit, but their streaming services, these things they've spent a lot of money on are losing billions and billions of dollars.
--:-- Noelle King: And so they say, you know, now is not the time to have to drastically change the model and pay writers a lot more money.
--:-- Lucas Shaw: So if a strike does happen on or around May 1st, what does that mean for what we see? Like as a television consumer or a streaming consumer, what does this mean for my shows?
--:-- Noelle King: Well, the immediate impact will be limited to those that are constantly producing new episodes.
--:-- Lucas Shaw: So like the late night shows are some of the first to go off the air. Stephen Colbert, The Daily Show, that's usually something that's hit very quickly.
--:-- Noelle King: We'll see if those programs have sort of developed any contingencies for this scenario, knowing what has happened before.
--:-- Lucas Shaw: For those who mostly stream their TV, I don't think they'd see an effect for really for a while because streaming services tend to stockpile projects.
--:-- Noelle King: So, you know, Netflix, we experienced this a little bit during the pandemic, where for the first several months, Netflix had plenty for people to watch.
--:-- Lucas Shaw: And it wasn't for sort of six or 12 months where we started to feel, oh, maybe the, you know, maybe the slate's a little thin.
--:-- Noelle King: What is a popular TV show that people talk about now and they say, look, if this goes on six months down the line, this really will mean something for XX show that everybody is really into right now?
--:-- Lucas Shaw: Well, think about a show like Abbott Elementary, which is a popular show on ABC.
--:-- Noelle King: Janine, that performance was on point. Oh, and they say you Penn students can't stick.
--:-- Lucas Shaw: Wait, who says that?
--:-- Noelle King: I tend to watch it on Hulu. Same.
--:-- Lucas Shaw: Those shows that air on broadcast, you know, the new seasons debut often in the fall or in the mid-season, which is sort of January.
--:-- Noelle King: The writing on that happens in the months leading up to that and then continues during the course of that show.
--:-- Lucas Shaw: It's a little different from streaming where they often sort of get the whole project done months before it's supposed to be released.
--:-- Noelle King: And so if this strike were to happen and if it were to drag on, the chances of the next season of that show coming on kind of as expected would be significantly lower.
--:-- Lucas Shaw: Most people think school starts when the kids get here, but it actually starts now at Development Week.
--:-- Noelle King: Teachers prep for the year. We get ready, get our curriculum. It's the calm before the storm. It's very zen, actually.
--:-- Lucas Shaw: You know, here's a question I imagine some of the writers are asking themselves. There is a lot of TV out there. There's actually a lot of very good TV out there, including a lot that people just don't have time to get to.
--:-- Noelle King: If we don't see new shows coming down the pipeline, are we really going to be missing all that much? Or do you think consumers are likely to say, OK, there's no third season of Abbott, a show that I truly love.
--:-- Lucas Shaw: I think I'm going to go and watch back episodes of Secession. Look, I would welcome a few months to go back and catch up with all the shows I've missed.
--:-- Noelle King: I keep a long list on my Apple notes or my iPhone notes of shows that I haven't watched that I'd like to at some point.
--:-- Lucas Shaw: I don't know that the average viewer thinks about it that way. I mean, by and large, the most popular programs on streaming are new series, right?
--:-- Noelle King: You know, more people are watching new episodes of The Night Agent on Netflix or The Mandalorian on Disney Plus than they are anything old.
--:-- Lucas Shaw: This is the way.
--:-- Noelle King: There are a few exceptions, shows like Friends and The Office that people go back and watch a ton of.
--:-- Lucas Shaw: The product, the crocodile. But my son returns.
--:-- Noelle King: But look, there's no shortage of television for people to watch on these streaming services.
--:-- Lucas Shaw: And I think some of the studios, you know, to our earlier conversation about their response to the writer's demand, some of these studios would be more than happy to save money over a few months if they don't have to spend a bunch and just ask people to watch older programs.
--:-- Noelle King: Seen it. Bad, boring, saw it on the plane, rerun, rerun.
--:-- Lucas Shaw: Okay, this is really interesting. So what you're saying is the studios are not going to be thirsty for content.
--:-- Noelle King: The writers presumably have money saved because they've been preparing for this.
--:-- Lucas Shaw: And audiences have enough stuff to watch until they die.
--:-- Noelle King: Who actually loses out here?
--:-- Lucas Shaw: While studios would be okay not having to spend a bunch of money for a couple of months because Wall Street is nervous about how much money they're losing on these streaming services, the best way to sign someone up to one of their streaming services is still to have something new, right?
--:-- Noelle King: You know, HBO Max, which is about to relaunch as Max in May. One of the things that they need to ensure that more people sign up for their service, because that's why they're doing it, they want more people to be using Max more frequently, is they need fun hit shows, new hit shows for people to watch.
--:-- Lucas Shaw: And while they may have it for a little bit, if they don't have those later this year. That's a problem for them.
--:-- Noelle King: Now, in terms of other losers, there are a lot of people who work on television shows who would suffer.
--:-- Lucas Shaw: You know, the last time there was a writer's strike, the economy in Los Angeles was estimated to lose more than $2 billion.
--:-- Noelle King: You think about the number of shows being produced, the number of movies being produced. It's not just rich people arguing with rich people.
--:-- Lucas Shaw: There are, you know, caterers, there are hairstylists, there are makeup There are drivers and truckers and all these people built around the production
--:-- Noelle King: And it really not just in Los Angeles either The way that the production business has changed over the last several decades you know Atlanta is a major production hub New Orleans is a major production hub New York, Chicago, Vancouver, Toronto, North Carolina, certainly, you know, London, some other places that may not feel it, but do welcome American productions.
--:-- Lucas Shaw: And you have just, you know, a lot of workers who've built up around those production hubs who would suddenly not have a job for a while and would have to find something else to do.
--:-- Noelle King: Coming up next, we're seeing lots of comparisons to the last big writer's strike in 2007. We're going to tell you how that one went down and how it changed and it did what's on your TV.
--:-- Noelle King: Support for Today Explained comes from Built Rewards. These days, it seems like everybody has a rewards program.
--:-- Noelle King: Good people right now are out of work. And it's, yeah, and possibly worse with all the late night shows off the air.
--:-- Lucas Shaw: Americans have been forced to read books and occasionally even speak to one another. which has been horrifying.
--:-- Noelle King: It's Today Explained. I'm Noelle King. We're back with Lucas Shaw of Bloomberg and of the Screen Time newsletter.
--:-- Lucas Shaw: So the writers went on strike in 2007. It lasted 100 days. It stretched into 2008. And this was the last big labor unrest in Hollywood.
--:-- Noelle King: We've seen some disputes and skirmishes since then, including this moment where, you know, writers fired their agents for a long period.
--:-- Lucas Shaw: But that was the strike that people remember vividly and sort of in part earned the writer's reputation for being kind of the most activist of the big Hollywood labor unions.
--:-- Noelle King: You know, that was a different time in Hollywood. It was the very beginning of streaming. 2007, 2008, that was the debut of Netflix's streaming service.
--:-- Lucas Shaw: It was the debut of Hulu. It was the debut of Amazon streaming service. It was so brand new, and writers were as preoccupied with, you know, DVDs and getting paid from those as they were from this, you know, oncoming revolution in pop culture.
--:-- Noelle King: What was the strike about in 2007? What were the issues then?
--:-- Lucas Shaw: So part of it was residual payments or fees for those DVD sales. You know, you think back then, DVDs, you moved more than, you know, a billion units a year.
--:-- Noelle King: Studios would make a couple hundred million dollars just from DVD sales for their biggest titles.
--:-- Lucas Shaw: And writers felt like they did not get enough of that money, much as they now feel they don't get enough from streaming.
--:-- Noelle King: There was also a lot of concern about the internet and making sure that they were adequately prepared for that.
--:-- Lucas Shaw: So at the time, the Writers Guild didn't have jurisdiction or power to negotiate over those. So that was one of the things that they were pushing for.
--:-- Noelle King: And they also wanted to make sure that they were getting paid in some way for kind of internet transactions, internet streaming, because again, it was so new that they weren't really getting paid for any of that.
--:-- Lucas Shaw: What ended up happening? Take me through it a little bit.
--:-- Noelle King: Well, there was a pretty long labor dispute where you had months of major writers petitioning at studios, protesting.
--:-- Lucas Shaw: They know damn well they're in the wrong here. The logic would be obvious to a child. A novelist receives fair royalties for their books. A musician receives fair royalties for their songs. Screenwriters deserve fair royalties for their work.
--:-- Noelle King: You had a complete shutdown in production. You know, we talked about there was no late night television for a long time.
--:-- Lucas Shaw: And there was a huge increase in reality TV. You think back in the history of reality, yes, there was the real world in the 90s and Survivor and Who Wants to Be a Millionaire came around around the turn of the century, but there was just a dramatic increase in reality TV produced coming out of that because that was one thing that these networks could put on the air.
--:-- Noelle King: NBC created Celebrity Apprentice, the spinoff of The Apprentice. I'm sure that's one of your favorite shows.
--:-- Lucas Shaw: Big Brother came on the air. You think back, there was actually a big labor dispute in the late 80s, and that is part of what gave birth to cops, I'm sure another one of your favorite shows.
--:-- Noelle King: And so strikes have historically been the cause of a big increase in reality TV.
--:-- Lucas Shaw: And then they reached a deal in early January but only after a lot of fighting back and forth.
--:-- Noelle King: The writers mostly ended up kind of giving up some of their complaints on the DVDs which in retrospect was okay.
--:-- Lucas Shaw: They did get some major gains on streaming just in getting the Writers Guild to have the jurisdiction to negotiate and also this structure for residuals or fees because one of the things for writers is not just getting paid up front, but getting paid in success and in relicensing.
--:-- Noelle King: Observers say there was compromise on both sides, but the studios gave the most, and today a new contract was presented to writers, first on the East Coast.
--:-- Lucas Shaw: I believe it's a good deal. I am going to be recommending this deal to our membership.
--:-- Noelle King: What I hear you saying is the writers mostly won in 2007. Is that right?
--:-- Lucas Shaw: I think it was mixed. You know, they certainly got more concessions, I think, than they would have had they not struck.
--:-- Noelle King: And that's what some members of the Guild are looking back on now as inspiration, because I do think there's some debate in the entertainment business over, you know, how effective these actions are.
--:-- Lucas Shaw: When the writers had this fight with their agents a few years ago, where they have ceremonially fired all their agents and only later did they reach a new deal.
--:-- Noelle King: They were fighting over this thing called packaging, which had to do with how agencies kind of make money from their work.
--:-- Lucas Shaw: And I think there are a lot of writers who look back on that fight and wonder if they actually got everything they wanted out of it.
--:-- Noelle King: How did that agreement, what are we talking, 16 years ago, 15, 16 years ago, how did that shape the Hollywood that we have today? Did it?
--:-- Lucas Shaw: First of all, it shaped what people watch in that it did lead to this dramatic increase in the production and output of reality TV, which has only increased since then.
--:-- Noelle King: You know, you look at Netflix and people were going crazy on Sunday evening because the live stream of the Love is Blind reunion did not function.
--:-- Lucas Shaw: And Love is Blind and all these reality shows have become such a big draw, even for Netflix and the streaming leader, which started with normal dramas.
--:-- Noelle King: It also, you know, it set the pay scale for what we see today in streaming and how writers are compensated.
--:-- Lucas Shaw: And this has been, you know, an ongoing dispute, I would say, over the past decade between the creative community in Hollywood and the streaming services.
--:-- Noelle King: You know, when streaming services first came around, Netflix told people, we'll pay you a bunch of money up front. You get paid like it's a hit.
--:-- Lucas Shaw: And by the way, you don't have to worry about how successful it is. And I think everyone was, you know, kind of relieved by that, right?
--:-- Noelle King: Because there was such pressure they felt if you had a show on broadcast to look at the ratings and people would wake up first thing Tuesday morning.
--:-- Lucas Shaw: And so did my show hit a 5.7 or a 5.9? And what does that mean? And Netflix absolved them of having to worry about that at all.
--:-- Noelle King: But now that streaming has become kind of the primary way, they realize that some of those models don't work so well for them.
--:-- Lucas Shaw: They want to know how their projects did and they want to get paid in success.
--:-- Noelle King: You know, there's this feeling of information asymmetry.
--:-- Lucas Shaw: But they're now negotiating with a bunch of companies that have set the practice of not needing to disclose data.
--:-- Noelle King: And if you let companies get away with that, they're probably not going to want to change the practice.
--:-- Lucas Shaw: Are there any other similarities between 2007 and today?
--:-- Noelle King: Well, I think there's similarities in that the writers feel like they're not getting paid enough. That's the obvious one.
--:-- Lucas Shaw: There is a new technology that is similarly scaring people now as streaming did then in artificial intelligence.
--:-- Noelle King: I don't know that AI is going to dramatically reshape the entertainment business as much as streaming did. It's obviously too soon for us to know that.
--:-- Lucas Shaw: There are some people who certainly think it will.
--:-- Noelle King: If the central part of this negotiation is related to minimums and residuals and mini rooms and all these things that govern sort of the nuts and bolts of making a TV show and how writers are paid, artificial intelligence is that other thing where they're going to make sure there's some kind of clause in the deal that protects them unless they view that as something they can kick down the road and get what they want on the core issue.
--:-- Lucas Shaw: Because that's, to me, one of the most interesting dynamics in this whole dispute is the writers are asking for a lot of different changes to the system, and there's going to have to be some compromise.
--:-- Noelle King: That, again, is a similarity last time where there were a lot of concerns about DVDs, also a lot of concerns about streaming.
--:-- Lucas Shaw: And in any negotiation, you just got to pick and choose a little bit.
--:-- Noelle King: And it seems like the other big dynamic here is you almost want to be able, if you're in the writer's position, you almost want to be able to predict the future.
--:-- Lucas Shaw: I mean, even two years ago, we as humanity were not worried about AI the way we are now.
--:-- Noelle King: And so if you lock in changes for a set period of time, well, in six months, those changes could be outdated.
--:-- Lucas Shaw: Yeah, you're absolutely right. Look back to the deal that they struck in 07, 08. The residuals that the writers receive for streaming, which is sort of paid for a project getting re-aired, They get paid for, you know, how long a show is on or how recently it was on and how many episodes.
--:-- Noelle King: But they don't really get paid for how many viewers it has or anything related to the success of a show.
--:-- Lucas Shaw: They just, some of it I'm sure they anticipated and couldn't get. And some of it they failed to anticipate just how much it would change.
--:-- Noelle King: And that's always the tricky thing with these is you want to negotiate a deal that gives you some wiggle room going forward. or you have to, you know, you end up striking 15 years later.
--:-- Lucas Shaw: That was Bloomberg's Lucas Shaw.
--:-- Noelle King: And full disclosure, a lot of Vox's staff, including producers, engineers and fact checkers, are part of WGA, the Writers Guild of America, though they are not involved in this vote or in the strike.
--:-- Noelle King: Today's episode was produced by Hari Mwagdi and edited by Matthew Collette.
--:-- Noelle King: It was fact-checked by Laura Bullard and engineered by Patrick Boyd.
--:-- Noelle King: I'm Noelle King. It's Today Explained. Thank you.
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