Hollywood's Ongoing WGA Strike: Unveiling the Deeper Turmoil

The Writers Guild of America is joyfully celebrating the end of one of its longest strikes in history. They stood strong alongside actors and successfully negotiated significant concessions from major studios and streaming services.

While specific details of the agreement are not yet revealed, the WGA leadership praised the three-year proposal as "exceptional." They informed members that the tentative contract, which still requires ratification, addresses the concerns of all members, from seasoned veterans to newcomers, in both the television and film industry.

The studios still need to negotiate a deal with actors, but both labor and management have made progress in overcoming this difficult five-month period and getting Hollywood back on track. However, this resolution will not address the underlying challenges that the entertainment industry is facing, which prompted the guilds to take this action. These challenges include the disruptive changes brought about by streaming, which is why some have referred to this as "the Netflix strike."

Writers picket in front of Netflix offices on May 2.

Frederic J. Brown/AFP/Getty Images

Talented individuals may find solace in being better compensated and fairly rewarded. However, it is important to acknowledge the somber reality that there could be fewer opportunities available, as the era of "peak TV" transitions into a period of financial restraint and heightened selectivity.

Nevertheless, these cautionary reminders should not overshadow the achievements of the united front formed by writers and actors. Their common belief in the necessity of taking a stand and addressing underlying concerns related to streaming, such as fair compensation for their work and regulations regarding the number of writers employed in TV shows, aims to prevent a recurrence of these problems in the near future.

In this regard, the enigmatic studio executive who engaged in a conversation with the website Deadline with the intention of extending the strike, in an attempt to force the guilds to succumb to financial pressure, clearly underestimated the situation. This person's demeanor resembled that of a villain in a James Bond movie, providing the writers and actors with material that fueled their frustration and determination.

Demonstrators carry signs during the WGA strike in New York City in May.

Leonardo Munoz/AFP via Getty Images

Regardless of the battle's outcome, Hollywood is showing signs of losing the war. Furthermore, consumers of entertainment might face the short end of the stick, being asked to pay more for content while having access to fewer options.

While some of these issues were predictable, others were not. The rise of streaming services, aided by the global pandemic, has diverted funds from traditional television and movie theaters. However, as streaming gains slow down, the revenue from new subscribers is failing to compensate for the losses.

Despite the success of "Barbie" and "Oppenheimer" this summer, any excitement about a revival of the movie industry was dampened by the failure of expensive blockbuster films like "The Flash" and "Indiana Jones and the Dial of Destiny" to meet expectations.

Additional tensions arose in the form of conflict between companies such as Disney and Charter Communications over fees for cable channels. This resulted in a temporary blackout of Disney-owned ESPN and other networks as Charter tried to control costs in response to a steady decline in cable and satellite subscribers.

In the ongoing battle for increased transparency regarding streaming viewership, writers strive to receive their fair share of the success generated by popular shows. However, even this endeavor may have its drawbacks, as warned by Bloomberg's Lucas Shaw, who suggests that streaming services may become more cautious with their spending. This cautious approach, in turn, negatively impacts the creative community. Consequently, in assessing the outcomes of the writers strike, there were a few winners, albeit with certain qualifications and limitations. Let's take a look at the specific details:

The WGA: "WGA Strong" proved to be more than just a catchy slogan, as the guild stood strong in its fight for fair pay, with support from SAG and other parts of the industry. However, if the agreement leads to a decline in "peak TV," it could result in fewer job opportunities and diminish the significance of this victory over time.

The AMPTP: The member companies, including Warner Bros. Discovery (CNN's parent company), faced considerable damage to their public image, as the guilds effectively garnered support and portrayed their CEOs as villains in the public relations battle. While the studios did save money on production in the short term, they may seek further cost reductions in the coming months.

Oscar campaigns: Undoubtedly the most advantageous outcome. As writers and actors refrain from endorsing their projects due to the strike, publicists are eagerly anticipating the opportunity to have them grace the red carpets once again, especially during the year-end movies linked to award ceremonies.

Traditional TV: The major networks couldn't afford to take any actions that would encourage viewers to explore alternative sources of entertainment. The strike's impact on their fall TV schedules left them at a disadvantage and allowed streaming services to benefit greatly.

The Writers Guild of America (WGA) seems to have obtained a significant concession that allows them to benefit from the success of streaming hits, potentially compensating for the financial loss during the stoppage. However, there is now a pressing question: Can streaming platforms increase prices or generate sufficient advertising revenue to counterbalance their dwindling growth?

On the other hand, the Directors Guild of America (DGA) may have been overshadowed in this process, as they swiftly reached an agreement with the studios in June, seemingly disregarding the momentum behind their fellow guild members' efforts for notable and transformative reforms.

Drew Barrymore and Bill Maher caused a stir when they announced plans to revive their shows without the help of writers, which resulted in animosity from those protesting. Although both eventually backed down, with Barrymore even offering an apology, it remains to be seen if there will be any lasting consequences in terms of guest bookings. While it is unlikely, it is worth keeping an eye on.

Despite the strike, there was not a significant shortage of entertainment content for consumers. However, following a 146-day production halt, there will be some spacing out of movies and TV shows in the months to come. Ultimately, the reality is that we will likely be required to pay more for the content we consume, regardless of where or how we access it.