The Writers Guild of America is warning investors about the impact on legacy networks and streaming services if a writers strike were to take place.
The guild, which represents more than 11,500 writers of film, television and streaming media, is currently in active negotiations with the Alliance of Motion Picture and Television Producers, but the current contract expires May 1 and a new agreement has not yet been reached. Moreover, close to 98 percent of WGA members have voted to authorize a strike if a new deal is not reached by that date.
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In response, the AMPTP has said that a deal “is only possible if the Guild is committed to turning its focus to serious bargaining by engaging in full discussions of the issues with the Companies and searching for reasonable compromises.”
If an agreement is not reached, a work stoppage would begin on May 2, according to the WGA, and writing for television, feature films and streaming series would be halted.
This would have a large impact on the production of late night shows, such as Jimmy Kimmel Live!, The Tonight Show Starring Jimmy Fallon, Real Time with Bill Maher, Late Night with Seth Meyers, Saturday Night Live and Last Week Tonight with John Oliver, as it would put a stop to any new episodes, the WGA wrote in a memo. Hulu, Peacock and HBO Max would also lose access to the new content.
Additionally, a strike in May might delay the network television season, which includes 45 percent of the episodes produced by legacy media companies Disney, Paramount Global and Comcast NBCUniversal, as writers on fall network series typically start work in May or June ahead of the season premieres. This would also impact the content and potentially the number of subscriber additions to streaming services owned by those companies including Hulu, Peacock and Paramount+. This, in turn, could present challenges at the streaming company’s and networks’ Upfronts in May.
Disney and Paramount had the most WGA-covered drama and comedy episodes in the 2021-2022 season.
Since streaming services are reliant on their content for subscriber additions, the WGA also warns that any stoppage could hurt the streaming profitability goals set by companies such as Disney and Warner Bros. Discovery.
“Disney and Warner Bros. Discovery have told investors that they anticipate their streaming services will reach profitability by 2024 and 2025, respectively, driven by increasing engagement, growing subscriber revenue and holding down churn. All of these factors are dependent on content WGA writers create, and could be jeopardized by a work stoppage,” the memo reads.
Still, rumors of a strike have been looming for months, and networks and streamers have been trying to get ahead of the possible work stoppage by stockpiling scripts, handing out early renewals and amassing unscripted titles that do not involve unionized writers.
On April 18, Netflix co-CEO Ted Sarandos also noted that his company may be better positioned than others should a strike occur due to the streamer’s large stockpile of content.
“If there is one, we have a large base of upcoming shows and films from around the world. We could probably serve our members better than most,” Sarandos said on the company’s earnings call. “We really don’t want this to happen, but we have to make plans for the worst[-case scenario], and so we do have a pretty robust slate of releases to take us into a long time.”
Warner Bros. Discovery president and CEO David Zaslav has also said the company has content lined up, should a work stoppage occur.
