Within both unions and the handful of giant media conglomerates that control the entertainment industry, sharply divergent agendas are making it more difficult to reach consensus in negotiating contracts.
Those differences are coming to a head today as the Writers Guild of America and the Alliance of Motion Picture and Television Producers face a contract expiration that comes just after midnight. Most observers expect talks to continue beyond then if progress is being made, and remain hopeful that a deal will be negotiated without a strike. Even if talks break off, any walkout wouldn't happen immediately, because writers must first hold a strike authorization vote.
Hollywood's current state of labor unrest is underscored by sharp divisions within the two guilds--the employed versus the jobless, those who work in TV versus film, newcomers versus veterans, headliners who make millions versus those who barely make a living.
Complicating matters is the consolidation of the industry into giant multimedia companies with different goals; technological advances such as DVD and the Internet that have vastly expanded the outlets for entertainment; globalization of the market; and the proliferation of cable TV.
Hollywood's shifting economics have seen dramatic increases in both studio revenue and the costs of making films and television programs.
"I call it the Balkanization of both groups," said Ira Shepard, a veteran labor lawyer who negotiated for advertisers during last year's six-month commercial strike by actors. "It's like the fall of the Soviet Union."
The Writers Guild, for instance, takes pains to stress that negotiations affect both TV and film writers. But three key money issues--money paid when shows are rerun on cable TV, in foreign markets and on the Fox network--that could trigger a strike almost exclusively affect the two-thirds of its members who write for TV and are of little interest to most screenwriters.
Likewise, the Screen Actors Guild, which is expected to start negotiating with studios in mid-May to replace a contract that runs through June, is an even more fractious group plagued by open infighting among its 100,000 members, who include working and unemployed actors, highly paid stars, commercial actors, dancers, extras, stunt performers and others pushing their own agendas.
But factionalism isn't exclusive to the labor guilds.
On the other side of the negotiating table are studios and networks that now are part of huge, diversified media conglomerates cobbled together from giant mergers during the last six years. Despite being the center of the talks, film and TV operations are an ever-shrinking portion of the overall businesses of their parent companies.
Although differences have long existed within the groups, for more than a decade they bubbled beneath the surface, allowing an unprecedented period of labor peace through the 1990s. Contracts were negotiated with little animosity well in advance of their expiration dates.
But changing industry economics brought about by soaring production costs, the expansion of cable TV and foreign markets, the expected emergence of digital distribution of films and bitter internal rivalries within the labor guilds pushed those differences into the open.
"With such diverse interests, it's amazing they ever get a deal done," said one top entertainment lawyer.
Residuals Versus 'Creative Issues'
Unlike labor unions in the auto, airline or other industries, most members of Hollywood's guilds are unemployed most of the time, with wage disparities between the haves and have-nots running into the tens of millions of dollars. At SAG, about 85% of the nearly 100,000 members are unemployed. The Writers Guild says that in any given year half of its 11,500 members don't work.
Although some writers are multimillionaires, 25% of the guild's members make less than $30,000. About 70% of SAG members make less than $7,500 a year acting.
Adding to the pressure is that both guilds, for maximum leverage, are negotiating about the same time.
In the current writers talks, the stickiest money issues have proved to be residuals that largely don't affect screenwriters. Instead, film writers have been preoccupied with enlisting the guild to help protect them from what they see as disturbing practices by studios and directors in making films. Those "creative issues" include whether directors should routinely have "A film by" screen credit and whether writers are included in meetings, allowed on the set and invited to press junkets.