Will The Writers' Strike Drive Down The TV Upfronts?

As the year winds down, the press releases dry up a bit and the new topics are few and far between, but one of the interesting tidbits of news this month is that the Hollywood writers' strike continues on. As many of you know, the writers' strike is a bitter dispute between the studios and the Hollywood screen and TV writers, and the dispute is over a very valid point; digital distribution royalties.

I side with the writers on this ever important issue as they merely want to be compensated fairly for their work in the future as we enter into the digital economy and the Internet becomes a more important distribution vehicle, but the studios want to retain the strong royalty shares they maintain on traditional broadcast rights. What I find most interesting is that the effect of the strike may actually be even more impactful in a positive manner on the writers than the actual negotiations themselves!

Year after year the television upfront has continued to increase in overall value, with rates increasing and total dollars allocated increasing as well, but each year there's been the threat of the future effects of digital distribution -- with the eventual outcome being that dollars will shift from TV to Internet as online video becomes a higher utilized format. Now the effects of the writers' strike are actually coming to fruition in the eyes of the average American consumer, since their favorite shows are running out of new episodes and they have no hope for future episodes in the foreseeable future. Shows like "Heroes" are now over and there are no new episodes in the can, which can certainly be detrimental to the future of a show! Already we see online shows like "QuarterLife"(Fox and MySpace) getting brought over to TV and "Law and Order: Criminal Intent" being brought back from TNT to air again on NBC. Some of the networks set aside shows like "American Idol" and "Lost," which are both set to air in the new year, but for the most part the average consumer will be treated to more reality programming or reruns of their favorite shows. Not the foreseeable future to do wonders for the Nielsen ratings!



What I'm getting at is, if the new year is all about reruns, than it is entirely feasible that two things will happen. First off, viewers will stop watching as much broadcast TV as usual and spend more time with other media formats, such as movies on DVD, reading or the Internet. This will be coupled with an increase in these writers finding new outlets for the creativity, like how the cast and writers of "30 Rock" went live with their show in New York, or how a number of writers are filming their work for shorts and putting it up online with sites like or just broadcasting it on YouTube.

Even the late-night talk shows are finding ways around the strike, with David Letterman and Jay Leno both agreeing to pay their staffs directly until the strike is over. Fundamentally, all these elements could have the eventual result of us witnessing the first decline in the television upfronts in I don't know how many years! Imagine what happens come March, April, May, when the ad execs on Madison Avenue take a look at the upcoming schedule, bereft of any quality new shows and filled with reality programming -- and they see the Internet featuring quality original "programming" and delivered in an on-demand format! What will happen with the ad revenue? Where will all those dollars go?

Once the studios and the writers come to agreement, which I imagine will happen well before May 2008, we'll see new shows get fast-tracked into production, but the damage may have already been done. The writers will have explored new distribution models and may not be as dependent on the studios for their livelihood going forward, plus they will be getting a larger share of the profits from the mainstream broadcast shows. The "double whammy" being that the writers will benefit on both ends.

Ahhh, to be a writer! Don't you agree?

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