WGA/SAGAFTRA Strike Discussion Thread | SAG Ratifies Contract

[21C]

I was thinking about it and I think there's a very good chance the AMPTP does let this thing drag out until the next year. 

As far as  I understand, the way the AMPTP works is that all of the companies in question need to agree before any deal gets made. And the problem the current landscape is facing is the fact that some of the companies involved have some very very very different priorities. 

I know the line of thinking that "Well they can't actually hold out until January because then their shareholders will question them and then they'll panic" and the thing is that may be true for some companies, but not all.

WBD, Disney, Sony, Paramount, Universal probably do want this thing ended by October or something like that. But Netflix, Amazon and Apple?

Netflix has a lot invested in international content, they also have a lot invested on reality TV and all their highest performing shows are still legacy shows that have been around for ages. The password sharing crackdown and the ad-tier has also seemingly had an effect on boosting up their revenues that seems like it could probably weather the storm of the strike for quite a while. 

And Amazon and Apple... those 2 are particularly dangerous because the entertainment business is not yet a core business for either of them. Prime Video is  still adjacent to Amazon Prime, which is still gonna pull in numbers regardless of the amount of content they have coming out or not, and Apple TV is still in its infancy and not yet a crucial part of the overall Apple infrastructure at all. The shareholders of both Amazon and Apple are not gonna be paying much attention to whatever is happening on those parts of their corporations because it's not a priority for them at all, probably not even top 3.  So those ones can afford to hold for probably an egregious amount of time that the other studios can't; but as long as they hold it doesn't matter because the AMPTP can't approve a deal without them.

Maybe there can be a scenario where WBD/Disney/Sony/Paramount/Universal can make deals on their own, but I don't know, that's highly dependant on what their agreement as a collective with the AMPTP is and how costly it'd be for them to break apart from their collective bargaining agreement.

Edited July 15, 2023 by 21C

[dudalb]

1 hour ago, DInky said:

 

 

The CEOs also don't want the shareholders to know when they fail because then they might be held accountable.

This. If I were a shareholder, I would demand to see the streaming numbers.

[Jonwo]

1 minute ago, 21C said:

I was thinking about it and I think there's a very good chance the AMPTP does let this thing drag out until the next year. 

As far as  I understand, the way the AMPTP works is that all of the companies in question need to agree before any deal gets made. And the problem the current landscape is facing is the fact that some of the companies involved have some very very very different priorities. 

I know the line of thinking that "Well they can't actually hold out until January because then their shareholders will question them and then they'll panic" and the thing is that may be true for some companies, but not all.

WBD, Disney, Sony, Paramount, Universal probably do want this thing ended by October or something like that. But Netflix, Amazon and Apple?

Netflix has a lot invested in international content, they also have a lot invested on reality TV and all their highest performing shows are still legacy shows that have been around for ages. The password sharing crackdown and the ad-tier has also seemingly had an effect on boosting up their revenues that seems like it could probably weather the storm of the strike for quite a while. 

And Amazon and Apple... those 2 are particularly dangerous because the entertainment business is not yet a core business for either of them. Prime Video is  still adjacent to Amazon Prime, which is still gonna pull in numbers regardless of the amount of content they have coming out or not, and Apple TV is still in its infancy and not yet a crucial part of the overall Apple infrastructure at all. The shareholders of both Amazon and Apple are not gonna be paying much attention to whatever is happening on those parts of their corporations because it's not a priority for them at all, probably not even top 3.  So those ones can afford to hold for probably an egregious amount of time that the other studios can't; but as long as they hold it doesn't matter because the AMPTP can't get a deal without them.

Maybe there can be a scenario where WBD/Disney/Sony/Paramount/Universal can make deals on their own, but I don't know, that's highly dependant on what their agreement as a collective with the AMPTP is and how costly it'd be for them to break apart from their collective bargaining agreement.

The traditional studios will do side deals, the big five alone could easily do it and I would argue that Apple and Amazon who are releasing things theatrically will to. 

[21C]

Just now, Jonwo said:

The traditional studios will do side deals, the big five alone could easily do it and I would argue that Apple and Amazon who are releasing things theatrically will to. 

The thing is though that the theatrical releases of both Amazon and Apple are kinda inconsequential for them at the moment; most of the stuff they've put out theatrically is stuff they know will lose money anyway. It's not something that their shareholders particularly care about at the moment because both of those corporations have other priorities as a whole that will still make money.

[Porthos]

1 hour ago, DInky said:

 

Can we stop saying that they're removing shows for a "tax write-off"? You can't do that for something you've released. They're removing them to avoid paying residuals.

 

No, it's a new(???)-ish accounting trick about "depreciated assets".  Technically called an "impairment charge".

 

Quote

Disney Reports $1.5 Billion Write-Off Charge for Removing Shows From Disney Plus and Hulu

5

 

Daniel Frankel

June 4, 2023·1 min read

 

 

 

‘Turner & Hooch’ on Disney Plus

The Walt Disney Co. said in an SEC filing last week that it will incur a $1.5 billion impairment charge in its ongoing fiscal third quarter following the removal of shows and movies from Disney Plus and Hulu.

 

Looking to reduce taxes and other charges, Disney pulled more than 50 titles from Disney Plus and Hulu, including recent series The World According to Jeff Goldblum, Y: The Last Man, The Mysterious Benedict Society, Dollface, The Mighty Ducks, Turner & Hooch, Willow, Maggie, Dollface and Cheaper by the Dozen.

 

Disney also said in its filing that it expects to write down another $400 million as more content gets removed.

 

It wasn't a surprise. During Disney’s fiscal Q2 earnings call last month, chief financial officer Christine McCarthy told investors an impairment charge of between $1.5 billion-$1.8 billion was coming.

 

Disney trimmed EBITDA losses on streaming to $659 during its fiscal second quarter vs. $1.1 billion the previous quarter.

 

More on the "adjustment of content value" angle:

 

https://variety.com/2023/digital/news/disney-1-5-billion-content-write-off-charge-streaming-1235631877/

 

Quote

Disney to Take $1.5 Billion Content Write-Off Charge in June Quarter After Pulling Dozens of Titles From Streaming Services

Mouse House says it could incur an additional $400 million charge for TV, movie removals

By Todd Spangler

 

Disney, after removing dozens of shows and movies from Disney+ and Hulu last week, said it will incur a $1.5 billion impairment charge for the June quarter.

 

In an SEC filing Friday, the company said that on May 26, 2023, it removed “certain produced content” from its direct-to-consumer streaming services. As a result, Disney will record a $1.5 billion impairment charge in its fiscal third quarter financial statements “to adjust the carrying value of these content assets to fair value.”

 

Disney said it’s continuing to review content on streaming platforms and “currently anticipates additional produced content will be removed from its DTC and other platforms, largely during the remainder of its third fiscal quarter.” As a result, Disney currently estimates it may incur further impairment charges of up to about $400 million related to produced content.

 

On Disney’s earnings call last month, CFO Christine McCarthy had said the company expected to take a write-down in the June quarter of $1.5 billion-$1.8 billion from removing content from its streaming platforms. By writing down the value of the content assets, Disney can remove those from its balance sheet to avoid having to pay ongoing residuals and to reduce its tax bill.

 

In its content purge last week, the media company pulled off more than 50 titles from Disney+ and Hulu, including series “Willow,” “The Mysterious Benedict Society” and “Dollface,” and movies such as “The One and Only Ivan.”

 

On Disney’s earnings call, CEO Bob Iger said he was “confident that we’re on the right path for streaming’s long-term profitability” and that as part of that the company would be “rationalizing the volume of the content we make and what we’re spending.” He also said the company expects to raise the price of Disney+ without ads later this year “to better reflect the value of our content offerings.”

 

In addition, according to Iger, the company will launch an integrated Disney+/Hulu “one-app experience” in the U.S. by the end of 2023 for subscribers of both services. Comcast chief Brian Roberts said “I think it’s more likely than not” that his company will end up selling its 33% ownership stake in Hulu to Disney within the next year. “I’m pretty certain if and when we sell our Hulu stake, it will be for more than what we have in it,” Roberts said.

 

 

It's not the same style of tax write off as Batgirl was and I don't nearly have enough financial background knowledge to really be able to discuss it intelligently (and I'm sure there are folks here who can), but Disney 100 percent took shit off the air off their servers for tax purposes.

 

Whether it's a true tax write off as a CPA would understand it is irrelevant on how it plays to the public.  And the cast/creators directly affected for that matter.

Edited July 15, 2023 by Porthos

[The GOAT]

 

[ListenHunnyUrOver]

Why does it seem like Disney (and their subsidiaries) are always the ones spearheading disgusting technological interventions like this?

[Cappoedameron]

1 hour ago, Jonwo said:

The traditional studios will do side deals, the big five alone could easily do it and I would argue that Apple and Amazon who are releasing things theatrically will to. 

All the big TV networks will definitely get deals done. They depend too much on their TV shows to fool around. I don't see them lasting that long. 

[Deep Wang]

24 minutes ago, ListenHunnyUrOver said:

Why does it seem like Disney (and their subsidiaries) are always the ones spearheading disgusting technological interventions like this?

 

Because they are a greedy mega-corporation that only cares about the bottom line and filling the CEO's pockets with as much money as possible and will ruin peoples lives to do so?

[DAR]

Does this mean MTV has to play music videos again?

 

 

[Water Bottle]

2 hours ago, 21C said:

I was thinking about it and I think there's a very good chance the AMPTP does let this thing drag out until the next year. 

As far as  I understand, the way the AMPTP works is that all of the companies in question need to agree before any deal gets made. And the problem the current landscape is facing is the fact that some of the companies involved have some very very very different priorities. 

I know the line of thinking that "Well they can't actually hold out until January because then their shareholders will question them and then they'll panic" and the thing is that may be true for some companies, but not all.

WBD, Disney, Sony, Paramount, Universal probably do want this thing ended by October or something like that. But Netflix, Amazon and Apple?

Netflix has a lot invested in international content, they also have a lot invested on reality TV and all their highest performing shows are still legacy shows that have been around for ages. The password sharing crackdown and the ad-tier has also seemingly had an effect on boosting up their revenues that seems like it could probably weather the storm of the strike for quite a while. 

And Amazon and Apple... those 2 are particularly dangerous because the entertainment business is not yet a core business for either of them. Prime Video is  still adjacent to Amazon Prime, which is still gonna pull in numbers regardless of the amount of content they have coming out or not, and Apple TV is still in its infancy and not yet a crucial part of the overall Apple infrastructure at all. The shareholders of both Amazon and Apple are not gonna be paying much attention to whatever is happening on those parts of their corporations because it's not a priority for them at all, probably not even top 3.  So those ones can afford to hold for probably an egregious amount of time that the other studios can't; but as long as they hold it doesn't matter because the AMPTP can't approve a deal without them.

Maybe there can be a scenario where WBD/Disney/Sony/Paramount/Universal can make deals on their own, but I don't know, that's highly dependant on what their agreement as a collective with the AMPTP is and how costly it'd be for them to break apart from their collective bargaining agreement.

 

You can lump Sony in with Amazon/Apple/Netflix. 

 

Even then, if WBD/Disney/Paramount/Universal really want a deal, they are going to put immense pressure on the other companies. For instance, sure Prime will bring in numbers. Until WBD/Disney/Paramount/Universal threaten to pull their libraries. (Same a bit with Apple, Netflix, and I think Sony sells movies/TV shows as well). And it's for the most part pressure that's one-sided. 

 

I mean the strike might very well last until next year. But let's not get ahead of ourselves here. 

[filmlover]

3 hours ago, Plain Old Tele said:

No one's posted Fran going off on Iger today?

 

 

She is holding absolutely nothing back and bless her for it. Iger and these other clowns are doing an A+ job demonstrating exactly why they are way too overpaid for their gigs (and perhaps shouldn't be calling the shots for anything in the first place).

[Gavin Feng]

I can't believe I see EC again in this way.

 

 

 

[DAR]

17 minutes ago, filmlover said:

She is holding absolutely nothing back and bless her for it. Iger and these other clowns are doing an A+ job demonstrating exactly why they are way too overpaid for their gigs (and perhaps shouldn't be calling the shots for anything in the first place).

 

You know the thing about Iger is he was probably the most appealing face the studios could have have put forth.  And it got completely fucked.

[LegionWrex]

10 minutes ago, Gavin Feng said:

I can't believe I see EC again in this way.

 

 

 

Love to see him get blasted though, he's been having it coming for a while.

[DAR]

Well it does hurt the one theater he sells popcorn at.

[21C]

35 minutes ago, Water Bottle said:

 

You can lump Sony in with Amazon/Apple/Netflix. 

 

Even then, if WBD/Disney/Paramount/Universal really want a deal, they are going to put immense pressure on the other companies. For instance, sure Prime will bring in numbers. Until WBD/Disney/Paramount/Universal threaten to pull their libraries. (Same a bit with Apple, Netflix, and I think Sony sells movies/TV shows as well). And it's for the most part pressure that's one-sided. 

 

I mean the strike might very well last until next year. But let's not get ahead of ourselves here. 

I wouldn't lump in Sony with the Amazon/Apple since the entertainment business is significantly more core to Sony, also Sony is financially a lot weaker than Amazon and Apple (Sony has a market cap of $137.5 billion, Apple one of $2.5 trillion and Amazon of $1.8 trillion)

And yeah, maybe they could threaten to pull their libraries buut I'm not even sure if they could since they already signed those deals, but even if they could, that'd probably only work for Netflix since once again, Apple and Amazon have more than enough cash from other sources that are more core to their corporations to weather that storm as well if Bezos and Cook are that determined.  Apple and Amazon could literally buy WBD (Market cap of $32 billion) and Disney (Market cap of $266.7 billion) combined if they wanted to. 

Hell, if you wanna go /really/ conspiratorial, if Apple and Amazon /really/ wanted to go scorched earth, there is an angle where they could actually benefit from holding this out as long as possible and causing the rest of the companies to implode on the stock market since they could later get a Disney or a WBD at a discount. Not saying that's what I think they'll do, but I'm illustrating a point as to how the incentives of those 2 specific corporations could align with really prolonging this against everyone else's interests and how the ridiculous amount of money they have and the position they are in would let them do it without much of a problem. Since they are worth trillions thanks to other ventures unrelated to this they are in a position where they can play /extremely/ dirty without actually getting hurt. 
 

Edited July 15, 2023 by 21C

[filmlover]

I doubt the strike lasts until next year but with it being apparent that a deal isn't being reached in the foreseeable future, the fall festivals have a good chance of being a lost cause and it wouldn't be surprising if some of the smaller movies that were clearly aiming for festival bows end up being punted off to next year to be on the safe side (not Killers of the Flower Moon but stuff like Poor Things, Dumb Money, Drive-Away Dolls, etc.) in hopes that they'll be able to build buzz then. Good for those praying for a Spider-Man Best Picture nomination that those dreams have an actual chance of coming true now, I suppose.

[eddyxx]

7 hours ago, MysteryMovieMogul said:

This is also so wild. Just saw this Tweet posted by a Disney Influencer, and... the fact that Influencers are freaked out about whether or not they can keep being Studio Publicity is so unhinged.

 

This is confusing. She’s not even

part of the union, yes? Why did she think she couldn’t shill for her corporate overlords?

[eddyxx]

5 hours ago, Cappoedameron said:

Wait was this show removed, I thought you could watch it on Disney Plus still? Didn't it have like 4 seasons?

 

They recently changed the marvel layout on Disney plus so probably did it then.  I think the only “legacy” live action shows still on there are under agents and inhumans tab, and the defenders saga tab.