Hollywood industry in crisis after strikes and streaming wars

Michael Fortin was at the heart of Hollywood’s golden age of streaming.

The actor and aerial cinematographer turned his passion of flying drones into a profitable business in 2012, just as the streaming wars were beginning. For a decade, he flew above film sets, creating stylish aerial shots for films and TV shows on Netflix, Amazon and Disney.

He is now on the verge of becoming homeless again. He was evicted from the Huntington Beach home he shared with his wife and two young children and is now being evicted from the Las Vegas apartment they moved into because they could no longer afford to live in Southern California.

“We were saving for a house, we had money, we did things the right way,” he says. “Two years ago, I didn’t worry about going out to dinner with my wife and kids and spending $200.”

“Now I’m afraid to go out and spend $5 on a value meal at McDonald’s.”

For more than a decade, business was booming in Hollywood as studios struggled to catch up with new companies like Netflix and Hulu. But this beautiful period ended in May 2023, when Hollywood screenwriters went on strike.

The strikes lasted several months and marked the first time since the 1960s that writers and actors joined forces, effectively shutting down Hollywood production. But rather than reacting with a roar, a year after the end of the strikes, production fizzled.

Projects have been canceled and production has been halted across the city as jobs have dried up, with layoffs at many studios – most recently at Paramount. There was a second round of layoffs this week, as the popular film company moves to cut 15% of its workforce ahead of a merger with production company Skydance.

Unemployment in the U.S. film and television industry was 12.5% ​​in August, but many believe those numbers are actually much higher because many film workers are either not filing for unemployment benefits because that they are not entitled to it, or because they have exhausted these allowances. after months of no work.

Overall, the number of U.S. productions during the second quarter of 2024 was down about 40% compared to the same period in 2022. Globally, there was a 20% decline over this period, according to ProdProwhich follows television and film productions.

This means fewer new movies and binge-worthy shows for us.

But experts say the streaming boom was unsustainable. And studios are trying to figure out how to be profitable in a new world where people no longer pay for ad-supported cable TV.

“The air is out of the content bubble,” says Matthew Belloni, founder of Puck News, which covers the entertainment industry. “Crisis is a good word. I try not to be alarmist, but the crisis is what people feel.

Part of this boom has been fueled by Wall Street, where tech giants like Netflix have seen record growth and studios, like Paramount, have seen their stock prices skyrocket for adding their own service offerings. streaming.

“This caused the content market to overheat. Just a few years ago, there were 600 live-action scripted series on the air, and then the stock market stopped rewarding them,” says Belloni. “Netflix collapsed – every other company collapsed. Netflix has since recovered – but the others are really struggling to become profitable again. »

And along with the bursting of the streaming bubble, some productions are also being lured out of California by attractive tax incentives in other states and countries. Los Angeles leaders are so concerned about the slowdown that Mayor Karen Bass last month created a task force to consider new incentives for film production in Hollywood.

“The entertainment industry is essential to the economic vitality of the Los Angeles region,” Bass said in announcing the plan, explaining that it is a “cornerstone” of the city’s economy and provides hundreds of thousands of jobs.

Recent data shows the entertainment industry contributes more than $115 billion (£86 billion) a year to the region’s economy, with an employment base of more than 681,000 people, said the mayor.

Strikes by writers and actors lasted for months and resulted in union contracts offering more money and protections against artificial intelligence.

Duncan Crabtree-Ireland, chief negotiator for the Screen Actors Guild union, told the BBC that some consolidation in Hollywood was inevitable. He says he is optimistic about the imminent resumption of production.

“What makes these companies special, what gives them their unique ability to create value, is their relationship with creative talent,” he said while visiting a picket line outside a Disney office in September, where video game voice actors are currently on strike to fight for similar rights. protections.

Hollywood “still thinks it’s in crisis,” he says. “It’s a city that’s constantly dealing with technological innovation – all kinds of change – which is part of the magic. To keep content fresh, everyone has the idea that things don’t always have to be the way they have been.

Mr. Fortin’s drone company was operating almost every day before the strikes. Today, he has only flown these drones 22 days a year since the end of the strikes. And as an actor – he often plays tough guys – he only worked 10 days. He worked as a background actor to survive, but the salary barely covered the gas money to get to Los Angeles from Las Vegas.

“It was a big wave, and it crashed,” Mr. Fortin said after a day flying his drones on AppleTV+’s Platonic — his first drone gig since April.

“Things are happening little by little,” he said in his van before returning to Las Vegas for a court hearing to challenge his deportation order.

“Hollywood gave me everything,” he says. “But I feel like the industry has turned its back on a lot of people, not just me.”