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Union Roundup – June 2009

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“This decision by the membership marks the end of a very long process. We can now move forward with a new sense of certainty.” Those were the words of actor Sam Freed, a 2nd National Vice President in SAG, as quoted in Jonathan Handel’s showbiz column over at The Huffington Post, rounding up reactions to SAG’s settled-at-last de facto “strike” of the last year, bringing to a close—for better or worse—Hollywood’s inordinately long shutdown season, nearly two years long, when one factors in the WGA walkout as well.

And it would seem that things should be “certain” for a while—working actors are getting a 3 percent raise in an era where most people are getting layoff notices and/or pay reductions, television shows can (theoretically) be organized under SAG contracts again, and the studios lose their last believable excuse for not greenlighting features. The “yay” vote for the new contract clocked in at around 78 percent, with 22 percent against, with higher margins on the “yes” side for union members outside of Los Angeles.

TV Week’s Bizwire took to the web the morning after the vote to pronounce somewhat grandly that Hollywood had achieved “Peace in Our Time” with an end to labor strife. But is it really? One of the only tangible concessions SAG was able to wrest from the conglomerates was an agreement to let their contract expire in two years, instead of three, which is to say, in 2011, when the current WGA and DGA contracts wind down.

What this means of course, is that there is probably only a reliable 18 months or so of feature film production ahead of us, (if “reliable” is a word that can, in any way, pertain to working in Hollywood). At that point of course, the visual content divisions of said conglomerates—those businesses formerly known as “studios”—will announce that until they can sign new contracts with those guilds, it will be too risky to greenlight any new features that might have to be shut down.

Not that SAG’s contract shouldn’t be synchronized with the other guilds. One disadvantage Hollywood’s labor force has had compared to say, the UAW, (back when there was a UAW, in that before-time when America had its own manufacturing base), is that they must negotiate with all the “producers” at once, rather than walk out against a single company—GE, Viacom, take your pick—at a time. Of course, it was when single companies began to peel away from the monolith and settle with writers, that there was, at last, some movement in that shutdown.

But just as “governance” in America is really an unending campaign season—we have, instead of in-depth analyses of where the Obama administration has succeeded or failed in the early going, media speculation on whether Sarah Palin has her garter in the ring for 2012—so one must wonder if Hollywood will be steadily marked by a seemingly unending slowdown/shutdown mode.

SAG president Alan Rosenberg, who would seem to be a lame duck when his term comes up within the year, announced that on the heels of his faction’s position getting roundly rejected (by a majority of the 35 percent of SAG membership who actually voted), he would take to the phones and contact other guild leaders about coordinating strategies early for that potential shutdown in 2011.

Of course, things aren’t as simple as a traditional labor vs. management dynamic. The economy still seems only as steady as a Jello bowl in an aftershock, and it was to a large degree a “one-in-the-hand” attitude that fueled the large “yes” vote for a contract that really didn’t settle the streaming media/ digital revenue issues that have been punted a couple of years down the road.

And not everyone survived to celebrate this putative “peace,” either. Venerable Pacific Title, which was founded as silents gave way to talkies and endured the Great Depression, shuttered its doors before the greenlights of feature production could start winking again. They were unable to secure bank loans to see them through the rest of the year.

On the Millimeter website, writer Michael Goldman set out to do a piece on “post-recession strategies” for Hollywood, and instead found himself writing about companies— like Pacific Title, FX house The Orphanage, and others—that didn’t make it. He interviews producer/director Marshall Herskovitz in the article, who observes that the larger systemic issues of the credit industry’s breakdown have affected the film biz in unpredictable ways:

“My feeling is that [the recession] has definitely impacted the movie business [long term] for the first time,” Herskovitz comments in the piece. “In many ways, we were recession-proof in the past. But there has been a complete shift in how investments and loans are made [globally] now. Those big companies have their own problems, and that never happened before… The potential of an actor’s strike had an intermittent effect, but what I think is more germane is the simple difficulty in raising money, along with the lowered valuation of some of these [media] companies and seeing ad dollars on TV diminish.”

Herskovitz also comments about being at the end of the DVD product cycle: “The other aspect to this is that DVD [sales and rentals] have leveled off. DVDs propped up our industry for the last 10 years, and the movie business without DVDs is not really a profitable business. It used to be, but now the business model doesn’t work without DVDs. There is also the problem of huge actor fees and other things, so in many ways, it’s a shaky business anyway.”

And, per that Jello bowl, only going to get shakier, outbreaks of “peace” notwithstanding.

You can’t definitively negotiate labor contracts when no one knows, exactly, where the revenue is going to come from. Or what it means that people are able to watch things at home, without commercials, because they’ve downloaded them in ways both legal, or otherwise.

Nobody wants to give up the old salaries, or the old perks, of what “making it” in Hollywood used to mean. But nobody knows, really, where the money is going to keep coming from to prop up those edifices.

Welcome to 2011.

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