The Screen Actors Guild (SAG), which represents about 160,000 artists, announced its exit Thursday after failing to reach a new working agreement with the Motion Picture and Television Producers Alliance, which represents studios including Walt Disney and Netflix. The strike begins at midnight.
Meanwhile, the Writers Guild of America has been on strike since May 2, shutting down late-night TV shows like The Tonight Show, halting several projects in progress and jeopardizing the traditional release of new TV shows starting in September.
In a statement prior to the strike, the studio alliance said it was “deeply disappointed” that the actors had walked out of negotiations. The studios said they offered “historic salary increases and residual increases” and a proposal to protect the actors’ digital likeness – addressing concerns about artificial intelligence raised by workers.
Dozens of popular shows including ABC’s Elementary and Netflix’s Stranger Things have already been retired. On Tuesday, Fox revealed its fall TV lineup that consists entirely of reality shows and animated shows that have already been completed.
The effect of simultaneous strikes, if they lasted more than a few days, is likely to be wider than writers’ walkouts alone. Programs already written can still be filmed without screenwriters, but not without actors.
The cast will also have to stop promoting upcoming projects, such as movie premieres, award shows and events like San Diego Comic-Con International, which is scheduled for next week. Programs shot abroad can be affected. And while other contracts might allow actors who appear on game shows or reality TV to continue working, they may be pressured into joining the strike out of sympathy for their colleagues.
Director Christopher Nolan said of the theater that Matt Damon and Emily Blunt had to leave the UK premiere of Oppenheimer to “write their picket signs.”
Jane Fonda, Susan Sarandon, Rob Lowe, and Mark Ruffalo are among the stars who have already marched in picket lines in support of the book. Other unions, including IATSE, which represents 168,000 staged workers and others in the entertainment industry, have issued statements supporting actors as well.
“The longer it continues, it will only become an escalating problem,” said Kevin Neer of Bloomberg Intelligence.
The big strike in Hollywood is part of a larger battle that has seen workers fight for better pay and benefits from companies as far away as Starbucks, Amazon.com and Delta Air Lines. A union representing about 340,000 United Parcel Service workers is threatening to strike on Aug. 1 if the company does not meet demands for a wage increase in talks to renew its five-year contract.
The entertainment industry is struggling to deal with two related problems: declining audiences for traditional TV networks and staggering losses from a new generation of streaming services like Disney+ and Warner Bros Discovery’s Max.
Disney CEO Bob Iger said Thursday that the strike would have an “extremely detrimental effect on the entire industry.”
“This is the worst time in the world to add to this disorder,” Iger said in an interview with CNBC.
Every major entertainment company has laid off employees in the past 18 months, and many have pulled programming from streaming services to cut costs.
In a way, the double whammy marks a sad end to a film and TV boom that began when Netflix jumped into original production with House of Cards in 2013 and galvanized a decade of record-breaking productions.
Both the actors and writers say they were cut short by the move to broadcasting — and they want to be given a share of the companies’ profits from the shows. They also seek protection from the use of artificial intelligence, which they see as a threat to their jobs.
The last time the writers and actors went out together was in 1960, when SAG was led by Ronald Reagan. Both have been fighting to get royalties from movies that have been broadcast on television, according to the Los Angeles Times.
The writers’ most recent strike, a 100-day strike that began in 2007, cost the California economy an estimated $2.1 billion in lost output. The union now projects the cost at $30 million a day, based on its members alone.
The pause has hit companies that work with the film and television industry, including owners of studio space like Hudson Pacific Properties. Talent agencies imposed layoffs, furloughs and pay cuts.
In New York, home to TV productions like Law & Order and Blue Bloods, the number of permits to shoot movies, TV shows and commercials fell 43% in June from its level in 2022. FilmLA, which manages permits for projects in Los Angeles, said the number of permits was down. by 64% in the first week of July. No scripted TV series was filmed that week.
In the short term, strikes could boost the profits of the media giants. With filming off, they would have no film and TV production costs, yet could continue to earn revenue from cable TV distributors, advertisers, and show syndication sales, even if they were airing reruns or other shows.
“As long as they have content, they will continue to make money,” said Chris Thornberg, founding partner at Beacon Economics, a research firm.
However, the inability to launch and launch new software will affect the industry in the coming months. Media companies rely on new programs to attract and retain viewers or fill seats in movie theaters.
Streaming services have already released new releases but face a huge shortfall in 2024 if they can’t get production up and running before the fall.
Although the Directors Guild of America reached a new contract last month that included a 5% pay rise for the first year, the writers and actors have shown less willingness to engage.
“Overall, business is not in a conciliatory mood at this point in time given the tight labor markets,” said Thornberg of Beacon.