Ratification of New Deal Ends Historic Hollywood Strike

One of the longest Hollywood work stoppages in history has ended as Writers Guild Of America (WGA) members voted overwhelmingly to ratify the new contract with Alliance of Motion Picture and Television Producers (AMPTP).

After a week-long ballot, the Writers Guild Of America (WGA) announced that 99% of the 11,500 participating members voted to ratify the new contract with the Alliance of Motion Picture and Television Producers (AMPTP). Of the 8,525 valid votes, 8,435 were in favor, while 90 (1%) were against.

The new Minimum Basic Agreement (MBA) is effective from September 25, 2023, to May 1, 2026. The union estimates it will result in annual gains of $233 million for writers, lower than the initial demand of $429 million but significantly higher than the $86 million offered by AMPTP members during negotiations.

Key Demands Met

After a 148-day strike – comparable to the 1960 work stoppage by film writers, with the longest strike lasting 154 days in 1988 – there is a prevailing sense in Hollywood that writers, on the whole, are content with the new deal, which secured their key demands.

Initially, these demands faced staunch opposition from Hollywood companies. However, WGA members held their ground. Talks in August, the first since the strike began on May 2, fell apart amid leaks and heated exchanges of statements. It seemed a resolution would take much longer than it ultimately did.

The mood shifted when the so-called "Gang of Four" - NBCUniversal Studio Group Chairman and Chief Content Officer Donna Langley, Netflix Co-CEO Ted Sarandos, Warner Bros Discovery CEO David Zaslav, and Disney CEO Bob Iger - joined fresh talks in late September, indicating a potential breakthrough.

Writers have secured pay increases of 5%, 4%, and 3.5% over three years. While the 5% increase is historically high (the 2020 contract saw increases of 1.5%, 2.5%, and 2.25%), its impact is mitigated somewhat by high inflation, which peaked at 9.1% in 2022 and is projected to average 4.1% this year.

The WGA also achieved minimum staffing requirements for writers' rooms and unprecedented viewership-based streaming bonuses for high-budget streaming films and series.

This means that writers will receive bonuses equal to 50% of the fixed domestic and foreign residuals for shows viewed by at least 20% of a platform’s US subscriber base in the first 90 days or the first 90 days of any subsequent exhibition year.

This bonus comes into effect for titles released after January 1, 2024, and would see writers receive a $9,031 bonus for a half-hour episode, $16,415 for a one-hour episode, and $40,500 for a streaming feature with a budget over $30 million.

Regarding AI, both parties agreed that artificially intelligent entities are not considered writers under the MBA. This means that no script generated by AI is considered literary material, source material, or assigned material.

However, the WGA’s negotiating committee was unable to prevent studios and streamers from using writers' material to train large language models. Disputes arising from this point will likely be settled through arbitration.

The strike, combined with the ongoing 87-day SAG-AFTRA work stoppage, has had a profound impact on Hollywood production and the industry as a whole.

The non-profit, non-partisan think tank, Milken Institute, stated in September that the WGA and SAG-AFTRA strikes have cost the California economy approximately $5 billion, factoring in the impact on related sectors like catering and hospitality.

Late-night US talk shows went off the air immediately after the WGA strike began on May 2, and studio film and TV projects with incomplete scripts halted production.

Among these were Marvel’s Blade, which was ready to begin shooting in the summer; Universal’s Twisters (which was less than two weeks into production before it shut down, although the studio hopes to stay on course for a summer 2024 release); and the two-part holiday tentpole Wicked, which has about a week left to shoot and whose first installment is set to open in November 2024.

Late-night talk shows have since returned, and studio and streamer features, as well as TV shows, are expected to follow suit once the ongoing SAG-AFTRA strike concludes. Several independent productions with a SAG-AFTRA interim agreement are already filming, as long as the project is not covered by a WGA contract.

Hollywood Contraction

According to some executive estimates, there could be a 30% contraction in the film and TV business, continuing a bleak process of layoffs caused by the pandemic and the decline in Peak TV, as studios and debt-heavy streaming platforms review costs.

Thousands of writers have not worked for the last five months and have taken their picket line duties seriously. As a result, fewer speculative scripts are circulating around town at this relatively early post-strike stage. Some writers refuse to work until SAG-AFTRA signs a new deal and have been picketing alongside the actors.

TV studios have suspended overall writer deals, though there have not (yet) been as many terminations through the invocation of force majeure clauses as initially expected.

“Through solidarity and determination, we have ratified a contract with meaningful gains and protections for writers in every sector of our combined membership,” said WGAW president Meredith Stiehm on Monday.

“Together we were able to accomplish what many said was impossible only six months ago. We would not have been able to achieve this industry-changing contract without WGA chief negotiator Ellen Stutzman, negotiating committee co-chairs Chris Keyser and David A. Goodman, the entire WGA negotiating committee, strike captains, lot coordinators, and the staff that supported every part of the negotiation and strike.”

“Now it’s time for the AMPTP to put the rest of the town back to work by negotiating a fair contract with our SAG-AFTRA siblings, who have supported writers throughout our negotiations,” said WGA East president Lisa Takeuchi Cullen. “Until the studios make a deal that addresses the needs of performers, WGA members will be on the picket lines, walking side-by-side with SAG-AFTRA in solidarity.”

SAG-AFTRA represents 160,000 members and has been on strike for 87 days. Negotiators met with their counterparts at AMPTP in Los Angeles on Monday after resuming contract talks last week.

On Monday evening the union and AMPTP said talks would continue on Wednesday.