The Writers Guild of America declared victory after fighting with Hollywood’s largest talent agencies for nearly two years about how agents make their money.
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The pandemic sent Hollywood on a kind of roller coaster ride last year. On the one hand, this has led to an enormous increase in the demand for streaming content and, on the other hand, it has stopped film and television production. And that combination may have helped fuel the Hollywood power struggle between the industry’s biggest talent agencies and the Writers Guild of America. This is the union that represents film and television writers. Stacey Vanek Smith and Alexi Horowitz-Ghazi from our daily business podcast The Indicator From Planet Money take it from here.
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ALEXI HOROWITZ-GHAZI, BYLINE: If we were to do this script style, what does the world look like before this conflict?
JOHN AUGUST: It’s a world where there are studios that hire writers and agents that help writers get those jobs.
HOROWITZ-GHAZI: This is John August, a veteran screenwriter and a member of the Writers Guild negotiating team. He says talent agents have historically tied creatives like writers to the suits in the studios and TV networks for a 10% commission.
STACEY VANEK SMITH, BYLINE: But in the last few years Hollywood has started to move away from this classic system. The big agencies have always been paid more directly by the studios and TV stations rather than on commission. The big agencies had also started producing their own content.
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AUGUST: All of a sudden, your agent is no longer just the person on your side of the business. They really represent the other side of the deal, too. And that’s as clear a conflict of interest as you can imagine.
HOROWITZ-GHAZI: After months of unsuccessful attempts to renegotiate this entire system with the agencies, around 7,000 film and television writers from the Writers Guild fired their talent agents at once in April 2019.
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AUGUST: We’re trying to recreate the relationship between writers and agents in Hollywood.
VANEK SMITH: August says this was daunting at first, but the writers quickly switched to these informal networks that would help them connect with employers.
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AUGUST: Everyone started realizing that agents matter, but they’re not really critical to the whole process.
HOROWITZ-GHAZI: And then of course there was a pandemic and two big things happened to Hollywood. At first, television and film production came to a standstill. Second, everyone started bingeing huge amounts of content.
VANEK SMITH: And that was great news for streaming services, some of which debuted in the middle of the pandemic. It was also great for writers who could work from home and in many cases were even more in demand.
HOROWITZ-GHAZI: The big Hollywood agencies, on the other hand, were in trouble.
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AUGUST: In many cases these big agencies represented touring musicians as well as live entertainment and wrestling, and they had all of these things that were closed because of the pandemic. Writing was the only thing left.
VANEK SMITH: August says the combination of pressures ultimately helped shift power to the authors in their negotiations.
HOROWITZ-GHAZI: In July, United Talent Agency, one of the four major agencies that dominate the industry, signed a contract with the Writers Guild to mitigate conflicts of interest. It agreed to return to commission work and limit ownership of manufacturing companies to 20%.
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AUGUST: And that set the dominoes in motion.
VANEK SMITH: Two of the other big agencies did similar deals in August and December. Finally, last Friday, WME – the Hollywood agencies’ final event – announced that it too had reached an agreement with the Writers Guild of America and effectively ended the dispute.
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AUGUST: In the end, the writers got everything they wanted. We have found a solution to the two major conflicts of interest.
HOROWITZ-GHAZI: And that’s how scriptwriters could call a classic Hollywood ending. Alexi Horowitz-Ghazi.
VANEK SMITH: Stacey Vanek Smith, NPR News.
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