On May 2, 2023, the Writers Guild of America (WGA) labor union went on strike against the Alliance of Motion Picture and Television Producers (AMPTP). The WGA, which represents over 11,500 writers, and the AMPTP are far apart on a range of issues including streaming residuals, staffing levels, and the use of AI in script writing.
Streaming residuals are one of the most important items of concern for the writers. In terms of viewership, streaming overtook broadcast TV for the first time in 2022. This concerns the writers because for a variety of reasons they earn significantly less when writing for a streaming show as compared to writing for a broadcast TV show. Streaming shows usually have shorter seasons, 6-10 episodes compared to the typical 20-26 episodes per season on broadcast. Streaming shows often have a long hiatus between seasons meaning more time in between ‘gigs’ for writers. In addition, in streaming there is no opportunity for royalty checks once your show hits the magic 100-episode benchmark and enters re-run syndication, streaming shows are “always” available. Taking all these things into consideration, the WGA says the median salary of a streaming show writer is 46% of what they would make on a broadcast show. The union, trying to protect its members from the changing TV viewing patterns, is demanding better residuals from streaming services.
The union sees the writing on the wall, their personal income is decreasing as the streaming services gain popularity. They are holding firm in their demands as they see this as non-negotiable in contract discussions. If the two sides cannot come to an agreement and the writer’s strike continues for an extended time, it could change broadcast TV forever.
The last time there was a lengthy writer’s strike was in 2007. The strike lasted 100 days and resulted in a delay of the Fall premier season. The big broadcast networks combated the lack of scripted TV by introducing a full lineup of reality TV shows. History seems to be repeating itself. This upcoming season, broadcast TV is preparing for the writers’ strike by filling their schedules with reality TV and game shows. In fact, ABC’s fall lineup does not include any new ‘scripted’ shows, they are hoping that a schedule filled with ‘unscripted’ shows will make them strike-proof.
However, the lack of new shows will force audiences to find alternatives. Historically, the time that viewers spend on alternatives to network television grows when writers strike—and some of the shift becomes permanent. During the 2007 strike, consumption of videos and movies increased by 54.6%. Now, Broadcast TV’s biggest competitor is not the Blockbuster up the street but the streaming services with huge catalogs available on demand in everyone’s living room.
If the strike proves to be a lengthy one (and all accounts point in that direction) the lack of new programming in the fall will certainly drive viewers to alternative TV viewing. Streaming services and their extensive catalogs are well positioned to be that alternative for broadcast viewers and could just be the final push to help drive millions of Americans who have been tempted to cut the cord to finally do so.
If the strike entices even more viewers to make the shift to streaming services than previous projections, advertisers will shift more of their advertising budgets to streaming services leaving less in the “pot” available for broadcast TV advertising. Before the strike, Magna, a media research and ad-buying firm, expected overall spending on national TV networks to decline 6.7% this year. Although most of the big networks have been preparing for this strike and have assured advertisers, they have enough new content available, many advertisers are not convinced, and some are skittish about making big commitments now. Many experts expect the strike to accelerate the migration of TV ad dollars to streaming services. After all, advertisers will simply follow the audience's eyeballs.
Local news and sports may be the only thing to save broadcast TV but even that is questionable now that streaming services are inking deals with the professional leagues for exclusive coverage. With no new content and the ability to find local sports on streaming services and news on the internet, a long writers’ strike might just be the nail in the coffin for broadcast TV.
So, what’s an advertiser to do? Here at A3 Media, we can help you find where the eyeballs are, whether that be in OTT, Broadcast, OOH, or Radio. We know where to find your unique target audience and how to get your message to them in the most efficient and effective way. Call us to learn more.