(Roughly) Daily

… or possibly, Daniel Bessner argues, sooner…

… Thanks to decades of deregulation and a gush of speculative cash that first hit the industry in the late Aughts, while prestige TV was climbing the rungs of the culture, massive entertainment and media corporations had been swallowing what few smaller companies remained, and financial firms had been infiltrating the business, moving to reduce risk and maximize efficiency at all costs, exhausting writers in evermore unstable conditions.

“The industry is in a deep and existential crisis,” the head of a midsize studio told me in early August. We were in the lounge of the Soho House in West Hollywood. “It is probably the deepest and most existential crisis it’s ever been in. The writers are losing out. The middle layer of craftsmen are losing out. The top end of the talent are making more money than they ever have, but the nuts-and-bolts people who make the industry go round are losing out dramatically.”

Hollywood had become a winner-takes-all economy. As of 2021, CEOs at the majority of the largest companies and conglomerates in the industry drew salaries between two hundred and three thousand times greater than those of median employees. And while writer-producer royalty such as Shonda Rhimes and Ryan Murphy had in recent years signed deals reportedly worth hundreds of millions of dollars, and a slightly larger group of A-list writers, such as Smith, had carved out comfortable or middle-class lives, many more were working in bare-bones, short-term writers’ rooms, often between stints in the service industry, without much hope for more steady work. As of early 2023, among those lucky enough to be employed, the median TV writer-producer was making 23 percent less a week, in real dollars, than their peers a decade before. Total earnings for feature-film writers had dropped nearly 20 percent between 2019 and 2021.

Writers had been squeezed by the studios many times in the past, but never this far. And when the WGA went on strike last spring, they were historically unified: more guild members than ever before turned out for the vote to authorize, and 97.9 percent voted in favor. After five months, the writers were said to have won: they gained a new residuals model for streaming, new minimum lengths of employment for TV, and more guaranteed paid work on feature-film screenplays, among other protections.

But the business of Hollywood had undergone a foundational change. The new effective bosses of the industry—colossal conglomerates, asset-management companies, and private-equity firms—had not been simply pushing workers too hard and grabbing more than their fair share of the profits. They had been stripping value from the production system like copper pipes from a house—threatening the sustainability of the studios themselves. Today’s business side does not have a necessary vested interest in “the business”—in the health of what we think of as Hollywood, a place and system in which creativity is exchanged for capital. The union wins did not begin to address this fundamental problem.

Currently, the machine is sputtering, running on fumes. According to research by Bloomberg, in 2013 the largest companies in film and television were more than $20 billion in the black; by 2022, that number had fallen by roughly half. From 2021 to 2022, revenue growth for the industry dropped by almost 50 percent. At U.S. box offices, by the end of last year, revenue was down 22 percent from 2019. Experts estimate that cable-television revenue has fallen 40 percent since 2015. Streaming has rarely been profitable at all. Until very recently, Netflix was the sole platform to make money; among the other companies with streaming services, only Warner Bros. Discovery’s platforms may have eked out a profit last year. And now the streaming gold rush—the era that made Dickinson—is over. In the spring of 2022, the Federal Reserve began raising interest rates after years of nearly free credit, and at roughly the same time, Wall Street began calling in the streamers’ bets. The stock prices of nearly all the major companies with streaming platforms took precipitous falls, and none have rebounded to their prior valuation.

The industry as a whole is now facing a broad contraction. Between August 2022 and the end of last year, employment fell by 26 percent—more than one job gone in every four. Layoffs hit Warner Bros. Discovery, Netflix, Paramount Global, Roku, and others in 2022. In 2023, firings swept through the representation giants United Talent Agency and Creative Artists Agency; Netflix, Paramount Global, and Roku again; plus Hulu, NBCUniversal, and Lionsgate. In early 2024, it was announced that Amazon was cutting hundreds of jobs from its Prime Video and Amazon MGM Studios divisions. In February, Paramount Global laid off roughly eight hundred people. It’s unclear which streamers will survive. As James Dolan, the interim executive chair of AMC Networks, told employees in late 2022 as he delivered news of massive layoffs—roughly 1,700 people (20 percent of U.S. staff) would lose their jobs—“the mechanisms for the monetization of content are in disarray.”

Profit will of course find a way; there will always be shit to watch. But without radical intervention, whether by the government or the workers, the industry will become unrecognizable. And the writing trade—the kind where one actually earns a living—will be obliterated…

Film and television writers face an existential threat; viewers, a drab future: “The Life and Death of Hollywood,” from @dbessner in @Harpers. A bracing piece, eminently worth reading in full.

* Allen Ginsberg

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As we study streaming, we might recall that it was on this date in 1964 that AT&T connected the first Picturephone call (between Disneyland in California and the World’s Fair in New York). The device consisted of a telephone handset and a small, matching TV, which allowed telephone users to see each other in fuzzy video images as they carried on a conversation. It was commercially-released shortly thereafter (prices ranged from $16 to $27 for a three-minute call between special booths AT&T set up in New York, Washington, and Chicago), but didn’t catch on… though, of course, it augured the “future” in which now we live.

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