Is Hollywood heading for a civil war?
WGA West President David A. Goodman speaks during the 2019 Writers Guild Awards on Feb. 17 in Beverly Hills, Calif. Goodman and the WGA are squaring off with talent agents in a labor battle that could shake Hollywood. By Steven Zeitchik Steven Zeitchik Reporter covering the business of entertainment in the U.S.
The writers are upset by the evolution of the major Hollywood agencies, particularly the “Big Four,” the companies known as CAA, WME, UTA and ICM. These firms have over the years gone from a business model based heavily on collecting 10 percent commissions on jobs booked for clients to collecting fees from studios for the larger role of putting together the creative elements of a TV show or movie, a process known as packaging.
Or does such expansion amount to profiteering in contradiction of their purpose, and should their tasks be limited to the more specific goal of landing jobs for clients? Unlike the most recent Hollywood labor showdown in 2007-2008, in which writers walked off the job for more than three months because they could not reach a deal with producers, there would be no strike, and thus — probably — no immediate interruption of new shows on the air.
On Tuesday, the sides will meet for only the third time since the conflict emerged, when representatives from the WGA will sit across a table from ATA leaders and principals of the major agencies in a Los Angeles conference room. The first two meetings were considered non-substantive, with the WGA simply listing its positions. Whether significant negotiations will happen before the late-March vote is considered iffy at best.
“As agencies get into production it creates a very large problem,” said David Goodman, the president of the WGA West, “because it means a writer would be working for their agent. Now an agent has an interest in controlling the budget, for instance.” That, he noted, runs directly against a writer’s interest in increasing a show’s budget to up their paycheck.
Goodman said packaging fees were directly responsible, in part because agents collect 10 percent from the studio that in turn reduces the pool writers draw from, and in part because those fees disincentivize agents from fighting for higher client fees because they’re already collecting much more on packaging.
Whether the WGA would actually ask clients to fire their agents or whether this is negotiating brinkmanship remains to be seen. But realizing they were falling behind in the public-relations war, the agencies have begun firing back. The letter follows a note last week from WME President Ari Greenburg to writer clients after the company held several town halls with them.
“My agency was not representing my best interest — they were representing theirs,” the entry concluded.
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