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WGA and SAG-AFTRA Strikes Mirror Economic Tensions

On the 14th of July, the national board of the Screen Actors Guild of America (SAG-AFTRA) voted to join the Writers Guild of America (WGA) in strike action. This marks the first time that both unions have simultaneously downed tools in protest since 1960. As a result, nearly all scripted and dramatic productions have ground to a halt in the US and, in some cases, globally. This could have a significant impact on advertisers.

There are multiple reasons for the industrial action. However, two clear bones of contention prevail.

The primary reason for the strike has been actors’ and writers’ dissatisfaction with terms of payment of residuals, in particular by the streaming giants including Netflix, Disney+, and Amazon Prime. Residuals are payments made to the writers, actors, directors, and others involved in making TV shows and movies in cases of reruns, syndication, DVD release, streaming media, or generative AI.

Residuals have traditionally been paid to the cast and crew based partly on long-term success since a production was first aired. Streaming services do not report viewership figures in the same way as ‘traditional’ broadcasters, and they technically buy a licence to broadcast IP as opposed to paying for syndication. As a result, cast and crew are receiving vastly reduced residual payments. Actors have traditionally relied upon these payments to support them through lean times.

The second reason for the strike has been fears that generative AI technology is being used to replace humans in the creation and production of content. Both writers and actors are seeking to agree on a regulatory framework when it comes to how and when AI is used. Of particular concern to the writers’ union is that AI can be used to generate original and adapted screenplays, putting their jobs at risk. AI provokes similar fears in the acting community due to its ability to create digital likenesses of anyone from a megastar to extras, rendering humans similarly disposable in the production process. Concerns about the rise of AI are not new in society, let alone the entertainment industry. From the world of music to the world of sex work and pornography, AI is creating legal and regulatory headaches.

The strikes do not just affect writers and actors. Anyone connected to the production of content, including caterers, local businesses, major studios (in the US and globally), dry cleaners, and insurers, to name a few, will likely need to react should the strikes continue.

For brands, a long and drawn-out dispute will potentially compromise access to big talent represented by SAG-AFTRA for the creation of commercial assets. Additionally, the strikes could mean that big films slated for release this year are postponed, à la 'Dune: Part Two,' and that films and dramas scheduled for release in 2024 are delayed due to production being pushed back.