Hollywood is bracing for an industry earthquake that could shake television to its bone, causing millions or even billions of dollars’ worth of damage — a writer’s strike.
Though a seemingly limitless number of broadcast networks, cable networks and Internet-based providers like Netflix, Amazon and Hulu raked in $51 billion in profits last year, the writers who created all their entertainment say they didn't get a fair slice of the pie. In fact, they say, their slice is getting smaller every year.
Now the earth is rumbling with rumors that they may take to the picket lines, just as they did in 2007, when a 100-day writers’ strike shuttered production of more than 60 TV shows and lost the networks millions in advertising money.
The Writers Guild of America (WGA) and the Alliance of Motion Picture and Television Producers (AMPTP) have been in heated negotiations for the last month. They will return to the bargaining table on Monday after a two-week hiatus.
The writers are seeking to strengthen their health and pension benefits and to improve their contract and royalty arrangements.
"For the last five or so years, on the one hand, the companies have seen a boom from the growth in TV,” said Chris Keyser, co-chair of the WGA negotiating committee. “There's been an ability to reach a huge number of people around the world at any time.
“On the other hand, writers have seen their fees go down by 23 percent."
Keyser said today’s TV shows offer fewer episodes than they used to and take longer to shoot, meaning the writers’ fees are stretched over longer periods of time. Other issues being discussed are low script fees and residuals for streaming and cable shows.
“It used to be that you’d create a show, and you’d get a percentage of the back end or the residuals,” said TV producer Kenchy Ragsdale, former head of development for Sofia Vergara’s production company, Raze. Another issue is the writers’ health plan. "Costs are up, and contributions are capped at our incomes,” Keyser said. “We've been in the red three of the last five years."
Unidentified sources told the Hollywood Reporter that negotiators for the studios have offered to fund 80 percent of the guild’s health care shortfall, around $45 million, with wage diversions — money that would otherwise go toward wage increases. They want the WGA to address the rest of the deficit, about $11 million.
Such a plan would essentially force an increase in premiums. The guild’s health care plan currently covers individuals at no cost and families for $600 per year.
The studios are suggesting that the guild also cut benefits or increase the earnings requirement — currently $38,302 per year — for writers to be eligible for coverage.
According to the Hollywood Reporter’s sources, the writers have rejected those suggestions and are seeking an increase of $67.5 million to the health care fund and as much as two 0.5 percent wage diversions in years two and three of a three-year contract — up to $22.5 million, for a total of up to $90 million.
The guild is asking for a 3 percent increase in minimums, script fees for the lowest paid writers and increased residuals from streaming services. Negotiations appear to be at a stalemate.
"Our objective continues to be to reach an agreement with the WGA at the bargaining table,” said the AMPTP’s spokesperson Jarryd Gonzales. “We hope the guild will engage with us on the issues in that forum when negotiations resume on April 10th."
"We took almost 50 percent off the table from our negotiations,” and they responded with key rollbacks,” Keyser said. “This is not a sufficient response. We didn’t counter, and they said don’t bother coming back to the table.
"We’ve agreed to come Monday to begin a conversation. If we were to strike — and we’re many steps away from that — every writer would put their pens down, and even if something is in the middle of production, the writers will stop writing."
On Monday, the WGA will poll its members for a strike authorization vote, with online voting to run April 19 to 24.
If there is a strike, it will come while broadcasters are officially on hiatus. But several cable and digital series are slated to be in production in May, including Netflix’ "Marvel" dramas and the comedy “One Day at a Time”; HBO’s “Divorce”; CBS All Access’ “Star Trek: Discovery”; and FX’s “American Horror Story.”
No one wants a strike, says Graham Yost, executive producer and showrunner on Amazon’s “Sneaky Pete.”
“We all get paid well because we’re highly skilled and there’s a demand for what we can do,” he said. “But when the rules change under your feet, it just doesn’t seem fair.”