Hollywood writers walked off their jobs for the first
time in two decades after last-ditch talks with studios failed to yield a new
labor contract.
The Writers Guild of America's New York and Los Angeles chapters
stopped work at 12:01 a.m. local times, according to the east coast unit's Web
site and an e-mailed statement from Gregg Mitchell, a spokesman for the guild's
west coast wing. The last writers' strike, in 1988, lasted 22 weeks and cost the
economy an estimated $500 million, the guild said.
The strike threatens to shut down film and television production, and to
accelerate a longer-term migration of audiences and advertisers toward video
games and online entertainment. The union and the Alliance of Motion Picture and
Television Producers clashed over compensation based on DVD sales and Internet
downloads.
``It won't come to a screeching halt right away,'' said Jack Kyser, chief
economist for the Los Angeles County Economic Development Corp. ``The big thing
for the networks is the erosion of their audience. This is a real concern for
them.''
Talk shows are already announcing reruns. Disney's ABC said it will air a
previous version of ``Jimmy Kimmel Live'' tonight. ``Late Night With David
Letterman'' is in repeats all week, said CBS spokeswoman Kimberly Izzo-Emmet.
Negotiators were still talking late yesterday when guild members in New York
stopped work as scheduled at midnight local time. When the union refused to
``stop the clock'' and delay the strike, the studios ended discussions,
according to an e-mail statement from AMPTP President Nick Counter.
A federal mediator had called the two sides together yesterday in a final
attempt to avoid a work stoppage.
Deadline Rush
Each side claimed to have made concessions. The Writers Guild said in a
statement it had withdrawn its DVD proposal early yesterday and said the studios
refused to allow jurisdiction in most areas of new media.
In his statement, Counter said the studios ``made an attempt at meeting them in
a number of their key areas including Internet streaming and jurisdiction in new
media. Ultimately, the guild was unwilling to compromise on most of their major
demands.''
Writers started picketing at film and television production facilities in Los
Angeles starting at 9 a.m. local time, including those of Walt Disney Co., News
Corp.'s Fox, Sony Pictures, General Electric Co.'s Universal Studios, Warner
Bros. and Viacom Inc.'s Paramount. In New York, writers picketed at NBC
headquarters at Rockefeller Center.
`They Need Us'
``We're out here to show the public that it's not an abstract,'' Jon Robin Baitz,
46, creator of ``Brothers and Sisters,'' a drama on Disney's ABC, said in an
interview at Rockefeller Center. ``You have to show gigantic entities that the
individual will be heard.''
Baitz said there are enough scripts for the show, now in its second season, for
about 11 more episodes.
Kyle Engberg, 24, a writer for Comcast Corp.'s E! Networks, said he would rather
be at work.
``They need us for sure, so eventually, something's got to work out,'' he said.
No talks were scheduled between the union and the studios, Michael Winship,
president of the guild's east coast branch, said in an interview. The full
union's negotiating committee is meeting today, he said.
Disney shares fell 24 cents to $33.68 at 2:34 p.m. in New York Stock Exchange
composite trading. News Corp.'s Class A shares dropped 24 cents to $20.97, GE
fell 28 cents to $40.05, Viacom's Class B shares rose 20 cents to $41.78 and CBS
slid 15 cents to $27.52.
`Pretty Busy'
Bryce Zabel, a writer in Los Angeles whose credits include ``Mortal Kombat'' and
``L.A. Law,'' said yesterday that he and his wife, also a writer, were trying to
finish scripts and turn them in before the deadline. ``My wife and I will be
pretty busy trying to get everything done before midnight,'' Zabel said.
Soap operas and talk shows will be the first productions affected, because they
depend on writers for daily jokes and script changes. TV producers can hold out
longer before scheduling reruns of dramas and comedies because they've
stockpiled enough scripts to keep going for several months. Movie studios have
done the same.
Third-Largest Employer
``After a while customers get frustrated and start looking for other options,''
said David Smith, a professor at Pepperdine University in Malibu, California,
who studies labor relations. ``If they were to lose those customers for the long
term, the cost could be significant.''
Entertainment is the third-largest employer in Los Angeles County behind trade
and tourism. About 254,000 people work in the industry, which accounts for about
$30 billion, or 6.8 percent, of the region's $442 billion annual economy, Kyser
said.
``The length of the strike is the ultimate arbiter,'' Jonathan Jacoby, an
analyst with Banc of America Securities LLC in New York, wrote today in a
report. ``The degree of impact is dependent on the duration of the strike.''
The Teamsters, who represent location managers, truck drivers and casting
directors, could make the strike harder on studios, Jacoby wrote. ``If the
Teamsters join the picket line it could cause an immediate stoppage.''
Teamsters' Role
Teamsters leaders left it to individual members to choose whether to honor
picket lines, Patric Verrone, president of the Writers Guild's western unit,
said in a Nov. 1 interview.
Writers, the first of the industry guilds to negotiate this year, had demanded a
bigger slice of revenue from DVD sales and from shows viewed over the Internet
or mobile phones. Writers sought to double their share of DVD sales to 8 cents
and to receive 2.5 percent of all digital revenue, more than eight times the
amount studios offered, according to Jacoby.
Studios are planning for talks in the next several weeks with directors and
actors for contracts that expire in June 2008. New media compensation will
probably be a factor in those negotiations as well, said Jonathan Handel, an
entertainment attorney at TroyGould in Los Angeles, who is a former associate
counsel for the WGA.
Discussions with the writers stalled Oct. 31 after the union presented its
proposals for DVD and Internet downloads to the studios. The guild's directors
voted to strike on Nov. 2.
Differences between the union and the producers' alliance also include pay for
television reruns and use of writers' work in digital media, including the
Internet and mobile telephones.
Most writers depend on residuals from television reruns and DVD sales to survive
between full-time jobs, Carlton Cuse, writer and executive producer of ABC's
``Lost,'' said in a Nov. 1 interview.
