Could These Suits End the Strikes?

Greetings from Buffering West Coast headquarters, where the only two topics of discussion our sources are interested in are Barbenheimer and the strikes. One very senior former network boss I spoke with Wednesday actually thinks the amazing performance of the box office could help speed resolution of the current impasse: “This showed the studios that they actually still can make money again and that everything isn’t as hopeless as it seems,” she said. I want to believe that, but I worry this very smart person is underestimating the levels of greed and short-term thinking among the people who now run the major entertainment conglomerates. As for this week’s newsletter, the focus is once again on the strike — specifically, an idea from a good source of mine who suggested talks with the WGA and SAG would go better if business affairs execs from the studios and networks were involved. I decided to see what some other industry pros thought about that, and it turns out, a lot of other people think it could work, too. –Joe Adalian

Reach Joe on Twitter @tvmojoe or email [email protected].


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There’s a story making its way around some showbiz circles this week about the CEO of a major legacy entertainment conglomerate being asked by a friend how long he thought the WGA and SAG-AFTRA strikes would continue. “Not long enough,” said suit supposedly replied. If this conversation actually happened — in Hollywood, what starts out as a dark joke frequently ends up being passed off as juicy rumor — the exec’s crack reflects one of the worst fears of many in labor as the WGA walkout enters month four next week: Debt-ridden companies are deliberately stalling a new deal because shutting down production for a quarter or two will erase a big chunk of the red ink they ran up during Peak TV. “The strike is helping a lot of these places in the short-term,” one veteran studio insider sympathetic to the guilds says. “That’s the depressing part.”

But unless you subscribe to an even more cynical theory — the studios have decided to try to break the unions and are prepared to wait as long as it takes to get the deal they want — at some point within the next month or two negotiations with either the WGA, SAG-AFTRA, or both will likely resume. The question then will be, how do the two sides bridge the huge gaps currently separating their positions on multiple issues? The Hollywood trades and other media outlets have been filled with chatter about some sort of industry Elder Statesperson stepping in to help restore trust and break the impasse: Richard Rushfield at The Ankler floated former Fox boss Peter Chernin; others have nominated current and past bigwigs like Jeffrey Katzenberg (who could use a win after that whole Quibi mess).

Not to take anything away from those showbiz icons, but the issues at stake in the current standoff are so complex that bringing in folks who are simply respected within the business might not be enough. In her fiery speech officially announcing a strike, SAG boss Fran Drescher correctly noted that because the TV and film businesses have been radically transformed in the 15 years since the last WGA walkout, current labor agreements are built around a model which no longer exists. “You cannot change the business model as much as it has changed and not expect the contract to change, too,” she said. Instead of tinkering there needs to be reimagining, and doing that will require industry veterans who have hands-on experience crafting complicated deals acceptable to both labor and management. In other words, it’s time to turn to a class of Hollywood execs more comfortable donning green eyeshades than walking red carpets: The business affairs execs.

Over the years, BA execs — the good ones, anyway — have been repeatedly described to me as the unsung heroes of the entertainment industry. While they’re very much on the side of the mega-corporations which pay their salaries, their job also requires them to win the trust of all parties: They need to make sure their bosses don’t think they’re giving away the store while at the same time ensuring big talent and their reps don’t think they’re getting screwed. These execs are also skilled with hammering out complicated deals between companies which often have wildly different interests, like the one that saw streaming rights to Paramount Global’s Yellowstone mosey on over to NBCUniversal’s Peacock.

Obviously, BA execs aren’t universally beloved: Middle- and lower-class Hollywood workers have no doubt been victimized by penny-pinching clauses or other gimmicks designed to make up for the nine-figure pacts handed out to some A-list showrunners. And some of the major issues separating the two sides — particularly the use of AI — are going to be outside the area of expertise of the typical business affairs exec, meaning the labor relations folks who’ve been handling negotiations will remain integral to the process. But when it comes to a fundamental issue such as rethinking what residuals should look like in the age of streaming, multiple sources I talked to this week agreed that experienced business-affairs hands could provide the sort of imaginative ideas needed to break the impasse. “If you’re going to fix residuals, it requires someone who’s thinking outside the box to come up with an elegant way of changing the business relationships between the studios and talent,” one industry vet told me. “Somebody with a business affairs background could be incredibly helpful. They need to be in there getting out a whiteboard and figuring out a way to do this.”

One senior exec at a struck company agreed that only having labor relations experts represent the studios “is a strange setup” and said that he saw wisdom to the notion of BA experts getting involved at some point. “For stuff where you’re stuck on issues of transparency and specific deal points, it might possibly be better to have everybody’s BA person leading it,” this insider said. Another studio vet was also intrigued by the idea but also cautioned that any BA types chosen to head into the negotiations would have to be senior enough to win the trust of the company CEOs. “It has to be somebody that Bob Iger or Bob Bakish will listen to,” she says, referring to the repsecitve Disney and Paramount Global CEOs.

Finding folks the moguls respect might mean turning not to the business affairs vets currently on staff at the major companies but rather to their predecessors— the people who came up with the CEOs over the decades, or whose industry bonafides are impeccable. Among the names mentioned by sources I spoke with this week are BA pros who also moved on to bigger roles within their companies, such as former CBS president Nancy Tellem; ex-CW chief Mark Pedowitz; former NBC Entertainment co-chairman Marc Graboff; and recently departed Showtime Entertainment president Jana Winograde. All four spent years working as BA execs at various studios putting together hundreds of talent deals — experience that served them well when they moved closer to the entertainment side of the business. “What’s missing from the room, and missing in general in these talks, is someone who views the creators as collaborators and not just employees,” says one industry pro, adding that the aforementioned foursome all have “that ability to understand both the creatives and the realities of the business. They could get in there and say, ‘I don’t agree with them, but I get the value of what they do’.”

One veteran network TV scribe I contacted also saw how this particular kind of small screen suit could have a positive impact. “I normally bristle at the mere mention of ‘business affairs,” he told me.”But when you throw out a name like Mark Pedowitz, who has a long history of good relationships with creatives, that’s an idea I could get behind.” Indeed, for this idea to be more than just a cosmetic change, the AMPTP signatories would need to send in current or former BA execs with generally good reputations on both sides of the bargaining table. Bringing in your most ruthless killer negotiator is not the point here; enlisting people who actually understand the positions of both parties is what will move the needle. “Compassion is not a concession,” says one network vet who’s been dismayed by how the AMPTP has handled talks thus far. “These are supposed to be our partners. That’s what’s missing.”

Of course, for any of this to happen, the studios will probably first need to concede the WGA and SAG point that what’s needed is a completely new framework for a deal rather than giving the current pact a facelift and some more cash. “The companies have to admit a solution is required,” The Good Place creator Mike Schur, who is part of the WGA’s negotiating committee, told Variety this week. “Whether it’s SAG’s plan or our plan or some other plan, there has to be a better payment structure for actors, writers, directors and everybody when shows are successful.” But so far, as Variety noted in the same story, the AMPTP has called the idea of letting writers and actors share in the success of shows “a non-starter,” leading to the present stand-off: Nobody is working, and nobody is talking.

Which gets us back to where this story started: Do the companies which make up the AMPTP really mean it when they say they want to end the strike ASAP? Disney’s Iger, whom many once believed was the sort of beloved figure who might play a key role resolving the impasses, did nothing to spark optimism on that front with his comments to CNBC earlier this month. Instead of conciliatory words toward the creative community, he instead blamed the lack of progress on unions having “a level of expectation … that is just not realistic,” comments which will go down as a textbook example of saying the quiet part out loud.

Since then, suits such as Netflix’s Ted Sarandos and Paramount’s Brian Robbins have offered less bombastic takes, but what nobody inside the studio C-suites has done is give even the slightest hint that they’re willing to accept the notion that a compensation system created for the age of linear doesn’t makes sense in the era of streaming. “The studios are making so much money licensing and relicensing these shows for streaming. Why shouldn’t the writers enjoy the fruits of that?” says one former network exec who would never be described as a labor sympathizer. “Staying within the rubric of where we’ve been makes no sense. You need to have an entirely different approach to paying the writers and actors. But what I worry about is that the studios really believe they can strong-arm them and wait them out. It’s a remarkable clash of values.”

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