Two different strikes have brought Hollywood to a standstill. Both writers and actors are demanding better pay and fairer residual payments for their work. In the age of streaming services and on-demand downloads, content can live forever and be accessed at any time. The demands feel pretty reasonable.
Executives and fans alike fear a content slowdown as we near the fall. Do you know who couldn’t be happier about this though? The NBA.
It’s not just the NBA, of course. Any league with media rights up for grabs has reason to celebrate. Hell, even the Pac-12 may finally get a TV deal out of this.
Sports rights have always been valuable to television. Bob Iger explained why in his interview with CNBC last week, saying that Disney didn’t want to spin off ESPN and get out of the sports business entirely because live games “are an advertiser’s dream.”
At this very moment, they are also a dream partner for any executive in the entertainment business. If Adam Silver, Dana White, and George Kliavkoff are not camping out under a negotiating table right now, they are fools.
There are no residual payments involved in rights deals with leagues and teams. Games are so “of their moment,” that replays have little value and are rarely even much of a talking point in these negotiations.
What exactly can one group’s labor dispute do for another’s negotiating power? I guess it largely depends on when actors and writers are ready to come back to the table, but both unions are in this for the long haul. We think of actors like Tom Cruise and writers like Shonda Rhimes and wonder what they have to complain about, but the reality is most members of the SAG-AFTRA and the WGA are just trying to make a living. That is why each union is digging in its heels. The actors say they are prepared to be on strike through the end of 2023. Writers are not even returning to the negotiating table until the fall.
The studios may not have the incentive to end the strikes that we think they should. Remember, fewer people are going to movie theaters and every studio and streamer have a virtually endless supply of unaired pilots they can throw on. If the unions and the studios are each waiting for the other to feel the financial pain, Hollywood may not be cranking out new content for a while.
Right now, I can deal with the strikes. I don’t love that Last Week Tonight, one of my favorite shows, is nowhere to be found, but there is still plenty to watch. Will I feel that way if the new seasons of The Mandalorian or Shrinking are affected? Probably not, and that is what every league should be hammering home to the networks right now.
Market conditions have not been particularly kind to the Pac-12 to this point. To be fair, no one was on strike when these negotiations started and both labor disputes will likely be over by the time a new deal begins. But these strikes are likely to change the way business is done in Hollywood forever.
There will be less scripted and produced entertainment. Either shows will be eliminated or production is going to become increasingly more expensive and fewer will be made.
We also have to assume networks will want to safeguard themselves against future strikes. Reality and news magazine shows used to be a way to do that, but those have writers too. Plus, unless they are hits on the level of The Bachelor, they aren’t the kind of shows you have to watch while they are on in real-time. That makes them less valuable to advertisers.
Sports accomplish all of that though. Live games more reliably bring people to television. It is why spot time for the Super Bowl is nearly sold out before training camps even open. Maybe an October matchup between Colorado and Stanford isn’t the sexiest thing in the world, but it has a higher upside than re-running a 48 Hours about the Murdaugh family again.
The asking prices for live sports rights are already through the roof. The NBA reportedly wants to triple its media rights revenue with its next deal. Endeavor is looking for separate deals for UFC and WWE. There is also NASCAR, the College Football Playoffs, new NCAA championship packages, and more out there for the taking.
Do you know what isn’t guaranteed to be out there? New episodes of the shows that people already love. At best, they are indefinitely delayed.
That is bad news if, like me, you really want to know what the future holds for the Yellowjackets. That is good news if you have the good fortune of taking live games to market.
Demetri Ravanos is a columnist and features writer for Barrett Media. He is also the creator of The Sports Podcast Festival, and a previous host on the Chewing Clock and Media Noise podcasts. He occasionally fills in on stations across the Carolinas in addition to hosting Panthers and College Football podcasts. His radio resume includes stops at WAVH and WZEW in Mobile, AL, WBPT in Birmingham, AL and WBBB, WPTK and WDNC in Raleigh, NC.
You can find him on Twitter @DemetriRavanos or reach him by email at DemetriTheGreek@gmail.com.
