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CNN Sunday Morning

Writers Guild Strike Could Cripple Entertainment Industry

Aired April 29, 2001 - 10:18   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JASON CARROLL, CNN ANCHOR: The entertainment industry is bracing for the worst as the final days of the contract with the Writers Guild of America ticks down. It expires Tuesday at midnight and both sides are in talks to try and avoid a strike.

CNN's Lauren Hunter takes a look at what will and what will not be on television if the writers walk out.

(BEGIN VIDEOTAPE)

(BEGIN VIDEO CLIP, "THE YOUNG AND THE RESTLESS")

UNIDENTIFIED ACTRESS: There's no obvious brain damage, but he's not out of the woods yet.

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LAUREN HUNTER, CNN CORRESPONDENT (voice-over): For soaps such as "The Young and the Restless," daytime drama could take on a whole new meaning if there is a strike by Hollywood writers next week.

LYNN LEAHEY, "SOAP OPERA DIGEST": A long-term strike would be devastating to daytime. What happens is characters will go off course, storylines will go off course. Things won't make sense. All kinds of things happen on day time. Adjustments have to be made, an actress gets pregnant, someone want's to leave. You won't have the head writer there to make those kind of decisions. You won't have your key people there to make those very important decisions.

HUNTER: Ten soap operas provide 45 hours of original programming each week. And though general story arcs are written six months in advance, there's only about two weeks of episodes shot and ready to air in case of a strike.

MARK SCHWED, "TV GUIDE": No matter what happens, you will see a huge impact on what's on network airwaves if there's a strike. They won't go blank, but it'll be -- it'll be something to see, all those repeats and, you know, no new shows.

HUNTER: Many existing prime-time shows, including NBC's "Law & Order," have already shot additional episodes. And networks are relying heavily on unscripted series, including game shows, news magazines and reality shows. Writers usually start working on new episodes for fall shows in late June, but if they're walking a picket line, that could delay the start of the networks' fall season.

SCHWED: This is making their development season a nightmare, because how can they give somebody a green light to produce a show when they don't know if they're going to be able to have actors or writers? So it's driving them nuts.

HUNTER: Talk shows that employ guild writers, such as "The Tonight Show with Jay Leno," and "Late Night With David Letterman," could also be affected. During the last strike in 1988, both the Letterman and Johnny Carson shows aired reruns.

As for changes at your local theater, the summer movie lineup is already in place with set release dates for films such as "Pearl Harbor" and "Shreck," so it may be several months before audiences see much difference. So, as writers and producers continue their talks through the weekend and no strike authorization vote yet scheduled, Tuesday's deadline may not be as firm as once thought.

Lauren Hunter, CNN entertainment news, Hollywood.

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CARROLL: Now for more on the possible impact of a writers' strike, we turn to Brett Pulley in New York. He covers the Hollywood beat as the senior editor of "Forbes" magazine. Thank you so very much for joining us.

Why don't you start out by telling us, what is your gut telling you? You think there will be a strike?

BRETT PULLEY, SENIOR EDITOR, "FORBES": Well, certainly it's coming down to the deadline. It's difficult to tell now, because right now they're negotiating under a news blackout, so we haven't heard much in recent days.

What we do hear is that supposedly they have spent the past few days focusing on some of the easier issues and are planning to take up the tougher ones, like residuals. Of course, residuals, they plan to take that up in the latter hours of the talks, if indeed they do go up to the final minute Tuesday night.

And residuals, of course, that's the money that the writers and the actors receive for the repeated use of the programs; every time those programs show in repeat here in the U.S. or in foreign markets, they get a cut of that money. And that's one of the big issues that's keeping them apart right now.

CARROLL: Brett, if there is a strike, who are the people who are going to be hurt most by it?

PULLEY: Well, I think the first place you certainly have to look, Jason, is in L.A. and the L.A. area. The entertainment business in the L.A. county area contributes about $25 to $30 billion a year in revenue. And studies have shown, studies that have been conducted anticipating this strike, have shown that they expect a $7 to $10 billion loss of revenue in a prolonged strike that would go three to five months, and about 81,000 jobs.

Because this is an industry there that employs about 1/2 million, or about 1/4 of a million people directly and another 1/4 of a million in ancillary jobs, wardrobes, catering, et cetera, et cetera.

In fact, Mayor Riordan in L.A. last week pulled together a bunch of small business owners, people who own the cleaners across the street from the Paramount lot, people who own the lunch counter across the street from Sony Pictures. And those people obviously are concerned, because their livelihood depends on those places being up and operating.

CARROLL: Brett, I actually pulled this out from home here. This is an article from "The New York Times" from the business section from last week. Basically, this analysis piece says that the companies, the big media companies, are not eager to take a hard line against the writers' union. What are your thoughts on that?

PULLEY: Well, it's true. Well, but these big multinational conglomerates, I mean, there are a couple of interesting things here with them. One is, this, their ability to get this thing settled and not, in fact, have to endure a long strike, I think will say a lot about the ability of multinational media conglomerates to manage these quixotic purveyors of creative content.

For many years, when studios were sort of independent operations, they were able to keep peace with the talent. But now, of course, they are these big, big companies, as you point out, and then there are those like Vivendi, which runs Universal Studios. Now, Vivendi is a pretty diverse company, so even in a prolonged strike, they should be OK. A lot of their business is in water in Europe and waste management.

And even an AOL-Time Warner. AOL-Time Warner is a pretty diverse company also. However, in a prolonged strike you have to wonder what happens to the WB network, which is still a fledgling network, if too many viewers decide they're tired of looking at reruns there.

Then, of course, there are companies like Viacom, which have a lot of connected units. Viacom has CBS television, which would be impacted, MTV, other cable holdings which would be impacted. Paramount Studios and Paramount Television.

CARROLL: Alright, Brett Pulley, thank you so very much for your input this morning. Brett Pulley, senior editor of "Forbes" magazine. Thanks again.

PULLEY: Thank you.

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