Latest On WGA Strike: Guild Says Studios' Cries Of Poverty Are Hollywood Fantasy

It’s Day 16 of the Writers Guild of America strike, and the WGA is ramping up its attacks on the protests of pauperism from film and TV studios and streamers.

Since the start of the contract talks between screenwriters and the Alliance of Motion Picture and Television Producers, the AMPTP has said its member companies have invested billions in creating new streaming platforms and can’t afford to pay writers more.

In an email sent to its members on Tuesday, the WGA put together a chart illustrating how much its new contract would cost studios over its three-year term.

“The WGA estimates the proposals on the table at contract expiration on May 1 would cost the industry collectively $429 million per year, approximately $343 million of which is attributable to eight of our largest employers,” the guild said in its email.

In the chart, the WGA made estimates of its contract costs to the eight biggest employers of WGA members, compared to those company's gross revenues (not profits).

• Disney annual contract cost: $75 million.
  Disney annual gross revenue: $82.7 billion.
  
• Netflix annual contract cost: $68 million.
  Netflix annual gross revenue: $31.6 billion.
  
• Apple annual contract cost: $17 million.
  Apple annual gross revenue: $393.4 billion.

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Source: Writers Guild of America

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“These companies have made billions in profit off writers’ work, and they tell their investors every quarter about the importance of scripted content,” the WGA email concluded. “Yet they are risking significant continued disruption in the coming weeks and months that would far outweigh the costs of settling.”

The AMPTP did not immediately comment on the WGA’s email. It has previously said its latest contract offer included “outsized wage increases and residual increases,” or payments for the reuse of a writer’s material.

Background: What AMPTP has said

Hollywood producers released a statement on May 4 that addressed specific points of the WGA's concerns. Among the issues addressed by the Alliance of Motion Picture and Television Producers were:

• "Gig economy" for writers: It says screenwriting has almost nothing in common with standard “gigs" jobs. Writers often have a guarantee of specific weeks or episodes, and writing jobs come with benefits such as employer-paid health care and pension plan contributions.
  
• Mandatory staffing and duration of employment: The AMPT sees this essentially as a hiring quota that's "incompatible with the creative nature of our industry", and says it's a one-size-fits-all solution to shows that are each unique.
  
• Overall numbers: The AMTP disputes the WGA's claim that it's only offering $41 million a year in minimum wage increases. It says it's nearer $97 million per year, which doesn't take into account other wage and residual increases it's offered.
  
• Wage increases: It's offering the highest first-year general wage increase in more than 25 years, while also offering to create "an entirely new category of rates that will establish a new and higher floor for mid-level writers’ compensation".

• Streaming residuals: A 46% increase in residuals took effect in 2020, and many writers have yet to see these in their paychecks. For a one-hour episode of a Netflix or Amazon Prime series, a writer receives $72,000 in residuals over three years, growing to $114,000 over seven years.
  
• Artificial intelligence: "AI raises hard, important creative and legal questions for everyone. For example, writers want to be able to use this technology as part of their creative process, without changing how credits are determined, which is complicated given AI material can't be copyrighted. So it's something that requires a lot more discussion, which we've committed to doing."

Background: What the WGA has said

In a statement released the night before the strike, the WGA said:

• Read the full WGA statement

What else you should know

• It is the first WGA strike in 15 years; the last work stoppage began in November 2007 and lasted 100 days.
  
• As of today, no new talks were scheduled.

Why it matters

The WGA says that most of its nearly 12,000 members are making less than they once did, and that after factoring for inflation, average WGA pay has actually dropped 14% over the last five years.

The union says about half of WGA members are earning scale — the bare minimum wages stipulated by the contract with the AMPTP. Ten years ago, it was only a third.

Executives at studios and streamers maintain that they are still recovering from pandemic losses and have spent billions of dollars creating and buying content for new streaming platforms, some of which are far from profitable.

For Hollywood executives, the stakes are high: if the AMPTP deal for writers increases pay and residual payments, their profit margins could shrink. Furthermore, other Hollywood unions would likely use any WGA gains as the template for their demands; contracts for the Screen Actors Guild and the Directors Guild of America both expire in the coming weeks.

How we're reporting on this

John Horn, who covers arts and entertainment, has been following negotiations closely. Josie Huang talked to picketers and local businesses affected by the strike. In addition, our AirTalk team has featured the strike in on-air discussions on LAist 89.3 and LAist coverage.

Our podcasts HTLA and Retake have also talked to writers and others affected by the strike.

This is a developing story. We fact check everything and rely only on information from credible sources (think fire, police, government officials and reporters on the ground). Sometimes, however, we make mistakes and/or initial reports turn out to be wrong. In all cases, we strive to bring you the most accurate information in real time and will update this story as new information becomes available.

What questions we're asking

• What are the main sticking points in the negotiations?
• How do the contracts of other Hollywood unions — some of which have no-strike clauses — affect this strike?
• What's next for your favorite shows?

Learn more

• TV And Movie Writers Strike Over 'Gig Economy' Conditions. What’s At Stake In The WGA Walkout
• From Gas Stations to Restaurants: How The WGA Strike Will Hit The LA Economy
• This Hollywood Writers Strike Could Have Massive Economic Impact. An Economist Explains What We Can Learn From 2007

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