TK's MORNING BUZZ: Hollywood Strikes That Stop Movie Production Mean 'a Weak Slate of Theatrical Product' Down the Road30 Apr, 2001 By: Thomas K. Arnold
Tomorrow's the deadline for contract talks between the major studios and the Writers Guild, and if a settlement isn't reached by the stroke of midnight and the 11,500-member union votes to walk, observers say it's more than likely that the 135,000-member Screen Actors Guild will also go on strike when their labor pact expires July 1. A dual strike could shut down film and TV production.
Video is one of the points of issue -- the dispute between the studios and the writers centers on residual payments writers earn as movies and TV programs enter the after market, which includes home video -- and yet video will also be a beneficiary.
With no new movies coming out, video retailers will likely reap a bonanza.
For months now, the home video divisions of the major studios have been working overtime on contingency plans that, in a nutshell, are designed to keep the money flowing into Hollywood even if no new films are produced. Catalog promotions, fueled by DVD, will be in the spotlight as studios seek to regain the money they're losing through the home video channel -- and retailers will find themselves with more product and more customers who want to watch that product simply because the Big Screen is dark.
But retailers who are silently praying for a strike should think twice. A walkout might benefit them in the short term, but it would wreak havoc on the movie industry in general, putting thousands of people out of work -- not studio executives, but regular Joes who happen to be involved in some way with the motion picture industry.
Everyone remotedly connected with Hollywood would suffer -- so much so that Los Angeles Mayor Richard Riordan has been pressing for a compromise amid fears that a prolonged walkout could plunge the city into a recession. Riordan said a study last week found a prolonged strike by writers and actors could cost the Los Angeles County economy as many as 81,900 jobs and $6.9 billion in income.
Riordan even suggested negotiators tap as mediator former U.S. Senator George Mitchell, who helped broker a peace deal in Northern Ireland.
Video retailers who are still relishing the short-term prospects of a strike might want to consider this: What goes around comes around. Remember what happens every few quarters, when all the big retail chains' financials are down? The fingers invariably point at "a weak slate of theatrical product."
A strike may give home video a temporary boom, but four to six months down the road, there's going to be a bust. If movie production stops, home video's going to be hit with one of the weakest slates of theatrical product our industry has ever known.
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