Labor disputes have a theatrical quality. When Scarlett Johansson took Disney to court last July, claiming she was financially harmed for her role in “Black Widow,” the studio launched a frightening broadside at the actress by pointing out her “evident disregard for the horrific and prolonged global effects of the COVID-19 pandemic”.
In September, film crews demonstrated to demand better working conditions, brandishing signs designed by the best American production designers. And when WarnerMedia decided to screen “Dune” on its streaming service the same day it hit theaters, Oct. 21, the film's director, Denis Villeneuve, blurted out that “watching 'Dune on a television…is like driving a motorboat in a bathtub”.
The streaming revolution has poured a lot of money into Hollywood as studios race to attract subscribers. Netflix trumpets its fourth-quarter content offering will be stronger than ever, with new titles like “Don't Look Up,” starring Leonardo DiCaprio, and the final season of “Money Heist,” a Spanish bank-robbing saga .
On Nov. 12, Disney announced its latest blitz, with new shows for Disney+ featuring “Star Wars” and Marvel spinoffs. Total spending on content from streaming services could reach $50 billion this year, according to Bloomberg.
Turbulence over Hollywood
Yet for all this largesse, it's a turbulent time for Hollywood, as everyone from A-list stars to people who style their hair are at war with the movie studios. Some of the controversy has arisen due to the pandemic, which has disrupted production and release schedules.
But the tension has a deeper cause. As streaming disrupts the television and film business, the way artists are compensated is changing. Most movie workers are better off, but the power of megastars is evaporating.
It started with the pandemic. As theaters closed, studios scrambled to find alternative screens for their films. Some, like MGM's latest James Bond film, have been delayed for more than a year. Others have been given to streaming platforms, sometimes without the consent of the actors or directors.
Precisely those subjects whose compensation is linked to box office receipts have been paid either behind the scenes (as WarnerMedia did in the case of “Dune”) or after public disputes (as with Disney with Scarlet Johansson).
A new balance of power
Yet even before Covid, streaming was changing the balance of power between studios and creatives. First, there's more money out there. “There is an overwhelming demand and need for talent, driven by streaming platforms and the amount of money they are spending,” says Patrick Whitesell, executive chairman of Endeavour, whose talent agency WME had Charlie Chaplin among his clients .
Three years ago there were six big bidders for new film projects: Netflix and the five biggest Hollywood studios. Now, with the arrival of Amazon, Apple and others, there are nearly a dozen. Streamers pay 10 to 50 percent more than others, estimates another agent.
Support workers, such as cameramen and sound engineers, also have a lot more work. Competition between studios has created a "service provider market," says Spencer MacDonald of Bectu, a British syndicate, the country in which Netflix produces more shows than anywhere else outside North America.
In the United States, the number of acting, filming and editing jobs will grow by a third over the next ten years, four times as fast as America's total job growth rate, estimates the Bureau of Labor Statistics.
A frenetic activity
Product fame of streamers leads to frenzied activity in all professions of the industry. The fatal accident on the set of “Rust,” a film starring Alec Baldwin, has raised a debate about job security in the face of the frenetic pace of productions. But streamers' short, high-paying seasons leave more time for side projects that enrich the resume and make the job more creatively rewarding.
Working for Netflix or Apple means you can get award nominations in every role and every possible category, says one production designer, adding that the price for all of that is a 90-hour workweek. IATSE, a union representing 60.000 film workers in America, has reached an agreement with the studios for better pay and better conditions.
More controversial is the payment model for streamers, which is creating new winners and new losers. The stars were used to getting an advance and agreeing to a "back end" surplus that guaranteed a share of future earnings linked to the project's performance.
ùFor streamers, the value of a project is harder to determine, as it lies in its ability to recruit and retain subscribers rather than driving viewers to pay a ticket at the box office.
Studios also want the freedom to stream their content directly without having to fight a star like Johansson whose pay is tied to box office revenue. The result is that studios are following Netflix's example in "buying" talent with substantial advances, followed by little or no bonuses linked to the outcome of the product.
Advantages and disadvantages of the new remuneration model
This model benefits most artists a lot. “Senior payments are great for talent,” says Whitesell. You can negotiate the level of success of a piece of content, and then have it guaranteed”. Plus, instead of waiting up to ten years for the money, it comes the day the show comes out."
The 50.000 American actors averaged just $22 an hour last year, not including travel expenses, so most are happy to take the money up front and let the studio assume all the risk. Another agent confides that some celebrity clients prefer the streamers' confidentiality about the film's performance over the public dissection of box office flops.
For top actors and writers, however, the new system is proving to be a disadvantage. “People get underpaid for success and overpaid for failure,” says John Berlinski, an attorney at the Kasowitz Benson Torres firm that represents A-list actors.
The old contracts were a sort of "lottery ticket," he says. A hit show that runs for six or seven seasons can make $100 million in revenue; participating in a phenomenon like “Seinfeld” means earning a billion dollars.
Some star showrunners like Shonda Rhimes, who has produced repeat TV hits, currently under contract to Netflix, can close deals in the nine figures. But the creators of hit shows are more likely to end up with bonuses of a couple million dollars a year.
And although the actors are receiving what seems like huge payouts from streamers — Dwayne Johnson is said to get $50 million from Amazon for "Red One," for example — in the past they could even make double that from a back-to-back deal. end.
The newcomers to the studios
Some creatives complain that newcomers simply don't understand show business. With its "telephone company mentality," AT&T, a cable TV giant that acquired WarnerMedia in 2018, has turned Hollywood's most famous studio into something of a leper colony, complains an agent. Disney's new boss, Bob Chapek, comes from the company's theme parks division. Silicon Valley streamers are more comfortable with spreadsheets than stardust.
But their reluctance to worship A-listers also has an economic reason. The star system, in which ordinary people like Archibald Leach were turned into idols like Cary Grant, was created by the studios to take the financial risk out of the movie business.
A blockbuster, which today could cost $200 million to shoot plus that much for marketing, has a distant chance of breaking even at the box office. The bet is less risky if a star brings his own target audience with him.
The franchises
Today, studios are mitigating the risk of their productions not with stars but with intellectual property. Disney, which dominates the box office, relies on franchises like Marvel, whose success doesn't depend on which actors wear spandex leotards. Amazon's most expensive project so far is a $465 million "Lord of the Rings" spinoff without any megastars. Netflix's largest acquisition, $700 million, is the catalog of children's writer Roald Dahl (the author of The Chocolate Factory).
Also, the approach of streaming to producing hits is different. While to win at the box office it was necessary to bet everything on mammoth projects, Netflix's method is "more like an occasional walk where the 'successes' are first discovered by their users, then amplified by… algorithms", notes MoffettNathanson, a company of analysts .
Netflix aired 824 new episodes in the third quarter of this year, four times more than Amazon Prime or Disney+. His biggest hit, “Squid Game,” has a cast that is largely unknown outside of South Korea. “The competition isn't limited to who has the best content; it also matters who has the best technology to find out,” says MoffettNathanson. In the new Hollywood star you are neither made nor born: they are generated by an algorithm.
From: How Hollywood's biggest stars lost their clout, The Economist, November 6, 2021
