Hollywood is in some deep trouble. The agreement between AMPTP (American Motion Picture and Television Producers), which represents Hollywood’s studios and production companies, and SAG-AFTRA (the Screen Actors Guild and American Federation of Television and Radio Artists), the two guilds that combined in 2012, expired at midnight on Wednesday, July 12. Today, the SAG-AFTRA national board unanimously voted to declare a strike; the strike had previously been approved by nearly 98 percent of members. However, since May 2, the WGA (Writers Guild of America) has been on strike.

A SAG-AFTRA strike would have significant negative economic effects, similar to the WGA strike. Most productions in New York, Los Angeles, and around the nation have already been forced to stop due to staff members’ refusal to cross the WGA picket lines. A strike would have a significant impact on many industries because SAG-AFTRA represents 160,000 members, including “actors, announcers, broadcast journalists, dancers, DJs, news writers, news editors, program hosts, puppeteers, recording artists, singers, stunt performers, voiceover artists, and other media professionals,” according to their website. (In contrast, the WGA has only around 20,000 members and has just started day 73 of its strike.)

To be clear, a strike does not prevent someone from acting; rather, it prevents them from working for the corporations that are on strike (AMPTP members like Disney and Netflix). They cannot encourage work for the affected companies either, barring specified agreements. Major studios have, for example, been skipping Comic-Con rather than risk a disappointing performance from the few performers who would cross the picket line. Since WGA members have already abstained, you probably won’t see actors promoting new movies (like Barbie or Oppenheimer) or strolling the red carpet at film festivals. They won’t be present on the set, of course.

What does SAG-AFTRA want?

The average TV season now only consists of eight to ten episodes, as opposed to the 26 episodes per season that it once did under the traditional broadcast model. As a result, it is more difficult for actors to maintain a steady income because they put in far less effort on each job and frequently have longer gaps between them. However, pay hasn’t kept up with the change, therefore SAG-AFTRA is requesting a rise. (As the negotiations carry on, the particular terms are remain elusive.) Additionally, the guild believes that residuals, which are given to actors when their work continues to generate revenue for the studio in the form of reruns or streaming video libraries, are at a level that is unsustainable for its members. Residuals are paid to actors in a manner similar to royalties.

SAG-AFTRA, like the WGA, is extremely concerned about the possibility that quickly advancing AI will supplant its members. And that’s how it should be: actors’ voices or likenesses may be used to teach AI, which can then be applied to create fresh performances in voice-over, on-screen, and other contexts.

When questioned why they can’t increase minimums or residuals, the studios frequently point to the current economic climate as the cause. They don’t discuss AI much, which is probably noteworthy in and of itself. SAG-AFTRA disagrees with that math, just like the WGA does.

The truth is that studios and production businesses are increasingly incorporated into larger enterprises and tech firms that are answerable to shareholders. As a result, their perspectives on profit and revenue diverge from those of those who earn a living. It’s difficult to dispute with some mind-blowing numbers about CEO pay at entertainment businesses; in 2021, the average salary for a top Hollywood executive was $28 million. Disney CEO Bob Iger just signed a contract to lead the firm through 2026 and earns around $27 million annually. He described the actors’ demands as “not realistic” on television the morning the strike was declared.

Additionally, the AMPTP didn’t exactly come out looking good in a recent Deadline article that was released the day before SAG-AFTRA’s contract was set to expire and in which an anonymous studio executive claimed that they would let the writers strike continue until union members began losing their homes and apartments. According to a “insider” cited in the article, it is “a cruel but necessary evil,” and the article implied that the AMPTP had no plans to resume negotiations in the nearby future.

What does this mean for hollywood?

Many of the reality TV and unscripted programs that the TV networks have already scheduled for the autumn will still be able to air even if the SAG-AFTRA strike continues. The remainder will primarily be determined by how long these strikes last. The AMPTP will have to accept the fact that there won’t be many new movies or TV shows to attract people into purchasing tickets or streaming service subscriptions if they are serious about freezing people out until they lose their homes. The economic impact is significant; the writers strike alone cost California’s economy almost $2 billion in 2007.

Therefore, if your favorite show hasn’t already been postponed, it probably will be soon. Things are going to be strange; movies are going to advance once more. The unions contend that this is the price to pay for preserving the entertainment industry for the foreseeable future. Regardless of who “wins,” the ramifications will last a very, very long time.