Business Musings: Lessons From The WGA Writers Strike

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For most of you, the main issue in this year’s Writers Guild of America writers strike is whether or not your favorite TV programs will be affected. Already, some of the streaming shows, such as Stranger Things and Cobra Kai have shut down due to strike issues. The broadcast shows haven’t started next fall’s season (except maybe premiere episodes) and won’t until the strike is over.

Some shows, like late night talk shows and Saturday Night Live! have already gone dark.  Others may soon follow, depending on what happens with different unions, acting in solidarity with the writers.

For some of us, this strike has already had an impact. I know that my deals, which were humming along just fine thank you, are now going to take a hit that I can’t predict. Will there be more opportunity after the strike ends? Less? How involved are my deal partners in the WGA? (One is in Spain. Will that matter?)

I’m not the only person licensing derivative work who is wondering these things. I know of half a dozen book writers who just had projects paused or set aside for now. None of us know what will happen next.

And that goes double for my screenwriter friends. Those in L.A. have their picket line schedule. The others in various places, like Portland, are doing their bit on social media. They’re taking a risk, but they understand why this strike is happening.

In April, nearly 98% of the WGA membership authorized a strike if both sides couldn’t come to terms. The negotiations went late into the deadline night, May 1, with the strike being called when talks broke down.

For those of you who aren’t really following this, here’s the one paragraph shorthand. Every three years, the Writers Guild of America, which represents thousands of movie and TV writers, negotiates the terms of a Minimum Basic Agreement with the Alliance of Motion Picture and Television Producers. This is a collective bargaining agreement, which all members of the WGA and AMPTP must adhere to. A lot of work goes into the agreement, and it really does protect the writers as best as possible.

If you want to understand how this all works, take a look at the FAQ the WGA provided on this particular campaign.

I’m not going to rehash the details of the campaign, the strike or even the potential impact. Instead, I’m going to focus on the thinking behind this particular impasse (and the 2007-2008 one as well).

For years now, I have written post after post about contract negotiations and understanding your rights as writers. This is important for traditional writers with book publishers, yes indeed, but also for indies. Indies, if they are successful, need to understand the Terms of Service they’re agreeing to, as well as the contracts that they might sign if they license derivative works (like audio or merchandising or (ahem) movies) for their book (or, more accurately, their intellectual property).

Contracts (which is what terms of service are) dictate everything about our intellectual property once we put it out into the world. Signing the wrong contract, even missing a word, can cause problems.

Let me give you a really clear example that a writer linked to in one of my blog comments last week. Mark Sumner wrote on Mastodon that in 1999, a series he worked on went from NBC to the SyFy Channel. His income for that series went from $240,000 to zero. “Because,” he writes, “my contract paid ‘per broadcast episode’ instead of just ‘per episode.’”

One tiny word. Broadcast. That’s what the contract said, and that’s how payments were triggered.

I’m sure that when the contract was negotiated, it was not common practice to move an active show from broadcast to cable. In other words, the contract language in Sumner’s contract was probably standard, and the change was unexpected.

It is the job of lawyers on both sides to anticipate problems. It’s also the job of lawyers that work for big corporations to find loopholes in contracts and exploit them so that the corporation can reduce costs.

I have no idea how many writers, actors, and other creatives got slammed with that one little contractual word in 1999, but I’ll wager it was quite a few. If you look at the history of residual payments from the late 1960s, you’ll see a similar pattern of behavior.

(For those of you who don’t know, residuals are financial compensation paid to creatives in the film/tv industry “for the use of a theatrical motion picture or television program beyond the use covered by initial compensation.”)

Early on, there were no residuals for TV. Then residual payments were capped at six rerun performances. It took years for residuals to be uncapped and to apply to things like DVDs and foreign markets.

It’s not just writers who must fight the industry to get proper compensation. Other guilds (like the Directors Guild of America and the Screen Actors Guild) have done the same.

Sometimes the Minimum Basic Agreement for all of these guilds strives to right past wrongs. As Patric Verrone, the president of the WGA West during the previous strike, told The Los Angeles Times in April:

We know from other work areas — like in reality television — that if you don’t get jurisdiction from the jump, you’re never going to get it. It becomes a really high hill to climb.

Jurisdiction. He’s speaking legally. The WGA tried to retroactively organize reality TV writers, with limited success. Reality TV became the go-to medium for the networks in previous strikes, because those writers were not even affiliated with the WGA at that point.

Gradually, the WGA has chipped away at the disparity, but it is a chipping away process, not an actual victory.

Because of that, and because of other issues that were not foreseen until they bit writers (and other creatives) in the butt, the WGA has spent this century trying to harness the future for years. The big win in 2007-2008 received a lot of criticism at the time. It was over “new media” which was barely defined.

At the time, everyone knew that the internet was going to be a major part of film and television viewing, but it was assumed that only a small number of people would want to watch their favorite shows on a computer screen. Streaming as we know it didn’t really exist. Netflix was a DVD-by-mail company.

Everyone thought that streaming would be an ad-supported business rather than getting consumers to pay directly for the service.

And yet…the WGA, the DGA and other groups held out for residuals from new media. At that point, the offer on the table from the AMPTP was zero. No money paid at all to writers if anyone watched a show streamed over the internet.

Getting the right to negotiate over a writer’s contribution to “new media” as well as an outline for residuals was a huge victory in the 2007-2008 strike. At the time, though, no one knew how big that victory would be. In fact, I remember a lot of grousing from my screenwriter friends (because another issue, which had to do with DVDs, did not get settled).

Now, though, everyone understands how big that victory was. Meredith Stiehm, the current president of WGA West, told The Washington Post,

If we hadn’t won that — 50 percent of our work right now is on streaming services and platforms. We wouldn’t have been covered for that.

It was a near miss. And studios are still mucking with the details. That’s one reason why the controversies include the difference between a “mini room” and a writers room as it has existed for years in broadcast and cable. There is also a problem that we book writers have to deal with in some of the platforms we use—a lack of transparency.

Broadcast media has to show the audience numbers so that it can attract advertisers. Netflix and other streamers can claim something is a hit without backing it up.

Because of that, writers are missing a major payment: the bonus for a successful show. As Vox explains in its very good rundown of what’s at stake in this strike,

In general, the biggest problem is that residuals on streaming are lower than in broadcast TV. If you write on a broadcast show, and it’s a huge success, then you get extra payment, in part because your show is bringing more eyeballs to advertisements or cable subscriptions.

But if you write, say, Stranger Things, and it’s a massive hit for Netflix, bringing in thousands of subscribers and revenue, you don’t share at all in the profit even though you’re a main reason the platform is succeeding. That, the WGA argues, needs to change. In negotiations prior to the strike, the AMPTP refused.

I know, I know. This is deeply in the weeds for many of you. You think it doesn’t apply to you—and if you’re not a WGA member or if you don’t have anything under development in movies or TV right now, you’re right: there is no immediate impact on you.

There might be, since there is an AI component to the strike, which I am not going to discuss here at all. Look it up. I’m not going to discuss it, because many of you will panic and jump to the wrong conclusions. Read about it, think on it, and watch how the AI component of the strike develops. That component might have an impact on the definition of “writer” going forward, among other things.

What I actually want you all to look at in this strike and in the 2007-2008 strike (as well as the three contract negotiations in between) is the attitude of both the WGA and the AMPTP.

They are both leveraging their power to secure their future. They don’t think of themselves as pawns of corporations (the WGA) nor do they look at financial and compensation issues in the same way (the AMPTP, in particular).

Both are struggling to survive and to get the best deal possible for the people they answer to.

As individual writers, you answer to yourselves. Whenever you are making decisions for your business, you should be acting like the WGA and trying to harness the future. You need to make educated guesses about which rights to protect and which ones to sacrifice. You need to assume that you will have a future. For your intellectual property, that future will last for your life plus 70 years.

That’s a long time. You need to defend it for yourself and your heirs. (Don’t have heirs? Designate a charity—a large one, because small ones can’t manage something like a writer’s lifetime of work.)

But you also need to read contracts and terms of service the way that the lawyers for AMPTP do. You need to make sure you leverage the language in the contracts to benefit your business and maximize your profits.

I would hope that you wouldn’t do it on the backs of other creatives who work with you. I would hope that you treat them with respect and as equals. But you might have to walk away from a deal or working with an artist you love because the terms of that partnership don’t gel with your business.

Is it hard to learn all of this? Of course. Most writers think it’s deadly dull and exceptionally dry, and it can be if you just read tomes about intellectual property law.

But watch the law in action. See how negotiations work. Take a look at the impact of small words like “broadcast.” Watch writers fight for their positions in real time.

This strike provides an opportunity for study. Do so. There’s a lot of available information about this strike. Read about it, read about the negotiations, and think about what each side wants and what they need.

Guaranteed neither side will get what they’re asking for. They will have to compromise. It might take months. Let’s hope it only takes a few weeks.

But the future is at stake here, and negotiators on both sides know it.

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“Business Musings: Lessons From The WGA Writers Strike,” copyright © 2023 by Kristine Kathryn Rusch. Images in this blog provided by the WGA.