Hollywood industry in crisis after strike, streaming war

Michael Fortin is at the center of Hollywood’s golden age of streaming.

The actor and aerial cinematographer turned his drone flying hobby into a profitable business in 2012 just as the streaming wars were taking hold. For a decade, he’s been flying high above movie sets, creating stunning aerial shots for movies and TV shows on Netflix, Amazon, and Disney.

Now he’s on the verge of becoming homeless – again. He was evicted from the Huntington Beach home he shared with his wife and two young children and is now being evicted from the Las Vegas apartment they moved into because he can no longer afford to live in Southern California.

“We were saving to buy a house, we had the money and we did things the right way,” he said. “Two years ago, I wasn’t nervous about going out to dinner with my wife and kids and spending $200.”

“Now I’m worried about going out and spending $5 on a cheap meal at McDonald’s.”

For more than a decade, business has been booming in Hollywood, with studios scrambling to keep up with newcomers like Netflix and Hulu. But those good times ended in May 2023, when Hollywood screenwriters went on strike.

The strikes lasted months and marked the first time since the 1960s that both writers and actors had joined forces – effectively shutting down Hollywood production. But instead of returning to growth, in the year since the strike ended, manufacturing has stagnated.

Projects have been canceled and productions have been cut across the city as jobs dry up, leading to layoffs at many studios – most recently at Paramount. They had their second round of layoffs this week, as the popular film company moved to cut 15% of its workforce ahead of its merger with production company Skydance.

The unemployment rate in the U.S. film and television industry stood at 12.5% ​​in August, but many believe that number is actually much higher, because many filmmakers are not applying. unemployment benefits because they are not eligible or they have exhausted those benefits. after many months of not working.

Overall, U.S. volumes in the second quarter of 2024 were down about 40% compared to the same period in 2022. Globally, there was a 20% decline in that period, according to ProdProFollow TV and movie productions.

That means we’ll have fewer new movies and exciting shows.

But experts say the streaming boom is not sustainable. And movie studios are trying to find ways to make a profit in a new world where people don’t have to pay for ad-funded cable TV.

“The air has come out of the content bubble,” said Matthew Belloni, founder of Puck News, which covers the entertainment industry. “Crisis is a good word. I try not to be alarmist, but the crisis is what everyone is feeling.”

Part of the boom is fueled by Wall Street, where tech giants like Netflix saw record growth and movie studios, like Paramount, saw their stock prices soar while adding their own streaming service offerings.

“It causes overheating of the content market. There were 600 scripted live-action series on the air just a few years ago and then the stock market stopped rewarding that,” Mr. Belloni said. “Netflix collapsed – all the other companies collapsed. Netflix has since recovered – but others are really struggling to reach profitability.”

And with the streaming bubble bursting, some productions are also being lured away from California by attractive tax incentives in other states and countries. Los Angeles leaders are so concerned about the economic downturn that Mayor Karen Bass last month created a task force to consider new incentives for Hollywood production.

“The entertainment industry is vital to the economic vitality of the Los Angeles region,” Bass said when announcing the plan, explaining that it is the “foundation” of the city’s economy and provides hundreds of thousands of jobs.

The mayor said recent data shows the entertainment industry contributes more than $115 billion annually to the regional economy, with an employment base of more than 681,000 people.

The strike by writers and actors lasted months and resulted in union contracts that provided more money and protection against artificial intelligence.

Duncan Crabtree-Ireland, chief negotiator for the Screen Actors Guild, told the BBC that unionization in Hollywood was inevitable. He said he is optimistic that production will ramp up soon.

“What makes these companies special, what gives them the ability to create unique value, is their relationship with creative talent,” he said as he visited a line outside Disney offices in September, where video game voice actors are currently on strike for similar rights. protection.

Hollywood “always thought it was in crisis,” he said. “It’s a town that’s constantly faced with technological innovation – all kinds of changes – that’s part of the magic. Part of keeping content fresh is that everyone has the idea that things won’t always be the same.”

Mr. Fortin’s drone company operated almost daily before the strike. He has now flown drones just 22 days in the year since the strike ended. And as an actor – he usually plays tough roles – he’s only been on the job for 10 days. He used to work as a supporting actor to make ends meet, but his salary was only enough to cover gas expenses to get from Las Vegas to Los Angeles.

“It was a big wave and it crashed,” Mr. Fortin said after a day of flying his drone on the AppleTV+ show Platonic — his first performance with a drone since September Private.

“Everything is happening little by little,” he said in his truck before driving back to Las Vegas for his deportation hearing.

“Hollywood gave me everything,” he said. “But it seems like the industry has turned its back on a lot of people, not just me.”