Hollywood, strikes, and the "new media"

A recent column in the Wall Street Journal, by entertainment lawyer Kevin Morris, had an interesting take on Hollywood's upcoming labor negotiations, with the AMPTP producers' association squaring off against SAG, WGA and DGA:

A strike would put over 100,000 actors, 15,000 writers and 13,000 directors out of work, right at the dawn of global distribution for filmed entertainment over the internet and mobile devices. In case you've been under a rock, the long-awaited convergence of technology and content is here: Video streaming works, advertising on the Internet is thriving, and the "Old" companies are nervous ...

Given this backdrop, the guild and the studios should consider the possibility that 130,000 unemployed artists might find something to do when they are put on strike. And in so doing, they may just start creating original content for the new media because it is easy and, well, they're not allowed to go to the set or the lot. And once they do so they may enjoy the lack of interference from "suits" and become smitten with the ability to put their work out immediately and world-wide...

In other words, Morris is saying, this might not be a great time for companies to get stiff-necked about cutting labor unions in on a bit more of the entertainment cash flow, because to do so could accelerate changes that threaten the conglomerates' profitable status quo.

Will the companies see things this way? And loosen up a little? I wouldn't hold my breath. The wonderful thing about the status quo -- any status quo -- is that the people who have the largest stake in seeing it continue sometimes don't make the smartest decisions about preserving it.

I'll give an example from the union side: Eighteen or twenty years ago, lots of IA unions had a hiring system known as a "jobs roster" whereby hiring priority for union jobs was given to union members who had worked a stretch of time in a union classification on a union show and had what's called "roster placement". This system worked fine when 97% of Hollywood jobs were unionized. But a funny thing happened.

The IA and Teamsters got a large increase in wages in the 1985 contract negotiations. Lots of low-budget producers didn't want to pay the higher rates, and began using non-union crews. And where did these non-union crews come from? They were mostly newbies in the business who couldn't get onto union shows because they weren't on the rosters (the old status quo.) And non-union work -- fueled by higher minimum rates that the low-budget film-makers didn't want to pay and a growing workforce blocked from union membership -- mushroomed.

Suddenly the IA's live-action unions were faced with an up-ended status quo in a fast-changing world -- sound familiar? Staring irrelevancy and extinction in the face, it adapted. It loosened up all its roster systems. It began organizing aggressively. It negotiated new, "low budget" agreements that many IA business agents screamed about, but got the big non-union workforce inside labor's tent.

In short, the IATSE changed the way it had done business for almost sixty years, often in a slow and painful way, remolding itself to the Brave New World of smaller budgets and newer producers. And they survived and prospered.

Now, of course, the entertainment guilds and the conglomerates are dancing a tango that can either help them or deepen the wounds already inflicted by New Media. And within months we will know which option of the old mantra "Adapt or Die" they've decided to take.