Strike Watch: Welcome To (Grim) Reality

With the reports surfacing from tonight's Writers Guild meeting (or would you call it a rally?) that a walk out is now authorized and only the timing is in question, the real recriminations can start. The financial repercussions begin from this moment forward, and--excluding the expected but somehow still shocking news that the strike was apparently on--today's noisiest saber rattle came from CBS C.E.O. Les Moonves.

Many close observers of the strike debates would have bet that Viacom chief Sumner Redstone would have been the first to spout off about how blithely his corporation could walk through a writers strike. But-not unlike when Viacom C.E.O. Philippe Dauman said an end to the DreamWorks deal with Paramount would be immaterial, it was a Redstone lieutenant who cast the first stone on the strike.

Moonves' comments to financial analysts during a conference call on earnings today were widely and rapidly broadcast as he said, even if a strike occurred, "We're fully prepared to offer alternative programming options, and we would anticipate no material impact on the company for the remainder of the television season."

Some may have called it bluster--a Merrill Lynch report estimates that 57% of CBS' total revenue for fiscal year 2007 is vulnerable to a strike. NewsCorp, which is even more devoted to reality TV programming than CBS, has 36% exposure, and Disney, with its mix of family features, Jerry Bruckheimer-produced blockbusters, and park and merchandise perennials, is 27 percent exposed.

Still, Moonves used his reality-show cash cows to put the best face on the situation: "The great news for us is we have three well established long running franchises, which is Survivor, Amazing Race and Big Brother on CBS, and obviously, America's Next Top Model and Beauty and the Geek on the CW. Survivor is, believe it or not, we're beginning Survivor 17."

Backed by his theater-of-humiliation suite (the controversial Kid Nation went unmentioned in his comment) Moonves actually sounded bolder than he had back on September 18, in a Merrill Lynch fall preview discussion:

You look back ten years ago, a network only got paid in one way - they sold advertising, period. And since then, the rules changed. And suddenly, we were able to have ownership. So, now, we get advertising revenue, we get DVD revenue, we get domestic syndication, we get international syndication. And now, obviously, all the different ways we're selling our content on the Internet is huge.

That 'huge' of course, is exactly the sort of declaration that haunts AMPTP negotiators who must sit at a negotiating table and cry poor to the WGA reps. Clearly the writers' anger has been fueled by such declarations to Wall Street, as evidenced by the link at the recently established UnitedHollywood blog to a piece by former New York Timesman (and veteran of the working journalists' successful scrap over rights to some of the newspaper's internet take), Jonathan Tasini: "
The truth is that the top CEOs, while they are demanding that writers suck it up and make a pittance, are raking in obscene astronomical salaries and stock options."

Tasini also posted some CEO salaries ot prove his point, including Moonves' 2006 pay of $24.86 million, his five-year pay haul of $63.43 million. With stock options worth $30 million, and the CBS number for last year: 14.32 billion in revenue, with 1.66 billion in profit.

Moonves, during the September session, noted that CBS's own film production group, operating independently of Viacom's Paramount, "is moving forward. I think you'll see some announcements on that in the not too distant future. Our plans remain four to six movies a year, in the range of 20 to 50, 20 to 60, no more than that... dependent on the strike, etc.... we determine when we start production"

His concluding thoughts then seemed to mix threat and empathy:

A strike will be terrible for everybody. We are prepared for it. We have a lot of reality programming that could go on. It wouldn't be good. There are some of my studio peers that would, believe it or not, welcome a strike, that six months without production might be a healthy thing for them economically.

And I hope everybody remembers what happened in 1988. There is -- the writers lost jobs. The actors lost jobs, some of which were never replaced. But, more news magazines came on, some more reality shows came on. And the amount of jobs available post-strike were reduced for a while. And it just hurts everybody.

The last point, at last in the short term, can hardly be debated.
Although a recent Variety piece incensed some WGA stalwarts who felt it presented a rosier picture of feature film production, estimating that "There are as many as 50 studio movies ready to go into production now if writers walk...most studio 2008 slates aren't an issue",
One industry insider with a serious stake in the strike's impact noted that the films that are right on the bubble between locking a script or not are feeling a creative and logistical pinch:

By nature of the fact that everybody was ramping up for the June [DGA and SAG] guild] issues, there was a lot in the pipeline--so they're not being caught with no movies. They have them and they're out to actors, they're making deals. But as regards the October 31st issue, they didn't have a real strategy, even three-four weeks ago. Nobody thought [a work stoppage] it was happening, and you'd be surprised how, at the production level, how many studios were unprepared for that."

The obvious difficulty is if you've got an 85 to 100 million dollar mover with a director and a star and January start date, a lot of times the production script rewrites would be going on until the start date and sometimes three or four weeks into shooting. -if you're studio who'd been planning to do that, you're now looking at the strike starting, and suddenly, you're done.

Given the amount of A-list directorial talent that was first circling, then grabbing a spot in a high-stakes game of musical chairs (in which Paramount Studios noticeably missed a couple opportunities) were directors like Martin Scorsese, Tim Burton and Michael Mann and actors like Matt Damon (booked to co-star in Harvey Milk opposite Sean Penn before he opted to go do an Iraq movie with Bourne series director Paul Greengrass.

The working actors and directors, most of whom are financially quite comfortable anyway, will proceed much as they were. For the writers, it's going to be picket lines and going to the mattresses--for many, in different neighborhoods than they've become accustomed to. "The little guys always get killed" in strikes, one agent told me today, and with an array of belt-tightening maneuvers already moving across the agency business, the impact is already being felt. Strike 2007 is coming and with it, some realities even grimmer than Survivor 17.

(CBS CEO Les Moonves and Viacom CEO Philippe Dauman, June 2007; photo by Peter Kramer/Getty Images)