Hollywood calls it the “Netflix strike”. Here’s why

Netflix is ​​one of the powerhouses of the entertainment industry – and its changer.

So much so that the streaming giant has also become an avatar of fear for Hollywood writers as they enter the second week of a historic strike that has no end in sight.

Some in the 11,500-member Writers Guild of America have focused their frustration on the streaming company, calling this year’s labor action a “Netflix strike.”

“Netflix has in many ways turned the business model on its head and fundamentally destroyed it,” Jaclyn Moore, executive producer and writer of “Queer as Folk” on Peacock and “Dear White People” on Netflix, said Monday of the Picket Nearby from Netflix’s swanky offices on Sunset Boulevard.

Moore was joined by hundreds of WGA writers who rallied outside Netflix’s offices to protest for better wages and working conditions. They cited tensions and changes in the business that they say have been exacerbated by the streaming revolution sparked by Netflix.

These changes, the authors argue, have made it more difficult to support a Los Angeles family while writing shows for guild minima. The boisterous crowd included pregnant women, parents with children carrying signs reading “Day care is expensive,” and the Guild’s chief WGA negotiator, Ellen Stutzman, pushing her child in a stroller along the picket line.

“Streaming is the problem,” said author Janet Lin, who was working on the first season of Netflix hit Bridgerton, one of the most popular TV shows during the pandemic.

Netflix has helped transform the way people watch TV shows and movies by giving consumers what they wanted – watch on-demand instead of waiting for the latest episode, and an option to which was cheaper than the Pay TV package.

The company did so while delivering hits like “Squid Game,” “Bridgerton,” and “Tiger King,” spending about $17 billion annually on programming, and becoming one of Hollywood’s top employers.

The downside for many writers was that it changed the way they were compensated and how shows were made in a way they now claim is threatening their livelihoods.

“They changed the model, for a lot of good,” said Stephanie Hicks, a WGA member since 2016, who has worked on ABC’s Castle and The Rookie: Feds. “There is so much more content around the world. But you have to pay the content creators.”

Netflix co-chief executive Ted Sarandos said in a recent earnings presentation that the company’s extensive library of shows and films will help it withstand a strike in the short term. However, according to the creators, the Duffer brothers, production of several Netflix shows, including Stranger Things, has been put on hold. “Cobra Kai” and “Unstable” were also discontinued.

The Los Gatos, California company introduced shorter TV seasons with fewer episodes, set up smaller writers’ rooms for shorter periods, and paid artists up front rather than with a tiered “back end,” which would be lucrative if a show was in syndication or Syndication would be played when a movie hit cable TV.

Many of these practices have been adopted by legacy media companies, including Walt Disney Co., Amazon Studios, and WarnerMedia (now Warner Bros. Discovery), which launched streaming services to compete with Netflix.

“They were responsible for a lot of innovation and disruptive practices that were largely embraced by the creative community, but the business part is catching up now,” said Tom Nunan, a former studio and television network executive.

Netflix didn’t invent many of these changes that have rocked the industry.

Some of the trends — including the use of television seasons shorter than 22 episodes — were underway before the streaming service electrified the business. HBO’s The Sopranos, Sex and the City, and FX’s Nip/Tuck all had shorter seasons.

While Netflix didn’t necessarily cause problems for all writers, the company helped make certain practices commonplace, said Evan Shapiro, a former NBCUniversal exec who now runs his own company.

“You’re that brass ring that everyone was chasing after only to find out it was pewter,” Shapiro said. “They’re not alone in this, but they definitely started it.”

The Alliance of Motion Picture and Television Producers, the organization that represents media companies, said the rise of subscription video-on-demand has created more opportunities for writers to work on a television series because there are so many more shows being filmed .

Writers also receive paid residuals after the first season, while the syndication model depended on a show running at least four seasons. In the last deal, the studios agreed to increase residual rates, which resulted in more residual rates being paid. The value of residues increased by 28.1% from US$385.4 million to US$493.6 million from 2016 to 2021, according to WGA data.

One of the ways Netflix disrupted Hollywood was by making it standard practice for the streamer to greenlight a series based on a script rather than a pilot. While Netflix wasn’t first — AMC Networks has been basing its pick-up decisions on scripts, not pilots, since about 2015 — it has accelerated the trend.

“That’s a very attractive proposition for most show writers because they don’t have to go to a pilot’s audition,” Nunan said. “That’s what made Netflix stand out and really disrupted the business. Many other companies followed after that.”

On the other hand, Netflix Originals would live solely on their platform, cutting out the traditional syndication market that brought creatives hefty paydays on successful shows.

“There’s a price to pay for that,” Nunan said. “There is a residual price to pay. And that is what the strike is about.”

One of the most controversial developments among writers is a new way of working that is being popularized by streamers. Streaming services hired small groups of writers to flesh out a series before going into production. These small groups, known as mini-rooms, have been criticized by the WGA for undermining authors’ pay. Some writers spend weeks, if not months, writing three to six episodes of a series that doesn’t get picked up.

While working on the traditional 22-episode series, writers could be employed nearly 10 months a year. Now the new “typical” employment for lower- and mid-level writers on a streaming series is 20 to 24 weeks, or just 14 weeks if the room is called without a series order, the WGA said in a recent report.

According to a Netflix spokesperson, most Netflix writer rooms last 20 weeks.

Another problem for writers is that the hands-on experience of working on a show has disappeared throughout the creative process—often from picking up the pilot to filming individual episodes.

Geetika Lizardi, who worked as a writer for her first show, NBC’s Outsourced, in 2010, was employed about nine months a year, working through production and post-production and learning about the editing process. But for streaming shows, jobs span 20 weeks.

“You can’t make a living,” said Lizardi, who worked on Netflix’s upcoming third season Bridgerton. “It’s hard enough to get a job. And it takes more than two or three to survive.”

Studio executives acknowledge shortcomings of the current method because there are fewer writers present during the production of a show. The problem is that the industry is losing its time-honoured pipeline of training showrunners.

Moore, the showrunner, also said streaming companies don’t provide detailed viewership data, making it difficult for writers to know if they’re being paid appropriately. The lack of data reduces the bargaining power of creators when their show is a hit.

“What used to be public information, how did your show fare” is no longer available, Moore said. “The tech industry came in and made a black box out of that information.”

One of the propositions the WGA tried to introduce was the payment of residual payments based on viewership. But the AMPTP rejected the proposal.

Netflix pointed out how it publicly shares data on its most popular shows and films, as well as success metrics, with showrunners and directors. Netflix’s top 10 page gives the number of hours watched on its most popular programs, which is more data than other streamers like Amazon’s Prime Video.

Many in the industry want even more data to be disclosed.

“It’s really difficult to negotiate the value of the product you create when you don’t have information about how successful or unsuccessful that product is,” Moore said. “Instead of this, [you] You only have to listen to a tech company to tell you to trust them.”


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