Hollywood’s new streaming age ground to a screeching halt in May 2023 when both actors and writers joined hands for the first time in more than half a century to go on strike. Lasting several months, the historic strike brought Hollywood to a standstill, and its effects are still reverberating through the industry more than a year later.
Streaming represented a new frontier in television after decades of dominance by cable providers and allowed new companies, including Netflix and Hulu, to surpass established players in slightly more than a decade. However, streaming companies restructured the entertainment industry in a way that left writers holding the short end of the stick, often denying them the mentorship and residuals that writers in previous decades enjoyed.
The culmination of this was a massive strike that shut down production across most of Hollywood and led to many project cancellations. Hollywood still hasn’t recovered from the May 2023 strike and has seen a wave of layoffs at several major studios. Paramount, for instance, recently had its second round of layoffs as it approaches its planned merger with production firm Skydance.
Employment opportunities in the over-century-old industry are so scarce that many entertainment industry workers are now struggling to feed themselves and put a roof over their heads. The fact that production companies have been eliminating residuals from their contracts for the past decade or so means that employees have little to no residuals to live on now that jobs have run scarce.
Data shows that the American film and TV industry currently has an unemployment level of 12.5%, but some pundits say it could be even higher as many entertainment industry workers tend not to file for unemployment benefits. The industry is going through such a major low that production jobs in America were down by around 40% in Q2 2024 compared to Q2 2022.
ProdPro, a company that tracks film and TV productions, reports that there has been a 20% production drop globally during the same period. Production companies in all major countries aren’t making television shows and movies at the rate they used to just a few years ago, and film workers are paying the price. Many experts note that the streaming boom that made Netflix and similar entertainment giants was ultimately unsustainable.
Puck News president Matthew Belloni says the content bubble has burst and, while Netflix has managed to recover, other companies are limping along, barely getting by. And with the majority of consumers unwilling to pay for ad-funded cable television, production companies are scrambling to find new avenues for profitability.
It would be interesting to know what companies such as Momo Inc. (NASDAQ: MOMO) have experienced in their radio and TV production operations during this time when Hollywood is reeling in the wake of strikes and streaming wars.
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