Streaming is changing how Hollywood works, for better and for worse
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Streaming is changing how Hollywood works, for better and for worse

Source Code

Good morning! This Monday, streaming has its Hollywood moment, Expensify files to go public, and Apple will unveil new MacBook Pros.

Housekeeping

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That's show business

A last-minute agreement between the International Alliance of Theatrical Stage Employees (IATSE) and the Alliance of Motion Picture and Television Producers (AMPTP) helped avert a strike that would have shut down Hollywood: The two sides agreed on a new contract that includes pay raises as well as improved break schedules, Deadline reported Saturday evening.

The union had threatened that 60,000 of its members would go on strike today after weeks of contract negotiations. Streaming rates and residuals were just a small part of the union's catalog of demands. But ultimately, this labor dispute was all about streaming.

The last time IATSE members ratified a new contract was in 2018; a lot has happened since.

  • Disney+ and Apple TV+ launched at the end of 2019, and HBO bundled its streaming efforts under the HBO Max brand in May 2020. Other notable streaming launches included Paramount+ and Peacock, while Hulu began adding streaming-only shows from FX to its catalog.
  • Netflix grew its global subscriber base from 130 million in Q3 2018 to an estimated 212 million in Q3 2021.
  • Viacom acquired Pluto TV, Fox purchased Tubi, and Roku bought Quibi's assets. All of them are now looking to bring originals to their ad-supported services.
  • Movies like Disney's "Soul" and "Luca" as well as WarnerMedia's "Suicide Squad" and "Dune" all debuted or are set to debut on streaming services first.
  • At the 2021 Emmys, streaming services stole the show, with Apple's "Ted Lasso" nabbing seven awards, and Netflix taking home a whopping 44 Emmys — more than any other TV network or service.

In 2021, Hollywood has become synonymous with streaming, and some of the most popular shows and movies are being made by some of the world's richest and most powerful tech companies. IATSE workers point out that there is a large disparity between their working conditions and the balance sheets of the tech companies making bold moves in Hollywood.

  • "I did a show this year that was $12 million an episode for a company where the CEO just went to space," camera technician Carman Spoto can be heard saying in a video of the labor-aligned More Perfect Union while images of Jeff Bezos flashed across the screen. "We were working 16-hour days, and we were scheduled not to have any lunches for a six-month show. That's the reality."
  • The streaming boom has also led to a massive ramp-up of production activity across Hollywood: When "House of Cards" debuted as the first real streaming success story on Netflix in 2013, U.S. networks and streamers had a total of 349 scripted shows. By 2019, that number had grown to 532.
  • More shows for more services means longer hours and fewer breaks for studio workers. "We've had multiple people get in car accidents and some died in car crashes on the way home from being overworked and not getting enough sleep because the turnaround times are so quick," Spoto said in the same video. "That's more dangerous than when we're doing explosions on set [...] or doing helicopter stunts."

Shifting economic incentives behind streaming make matters worse: Companies like Apple and Amazon have been using streaming as loss leaders to boost other parts of their business, or investing billions of dollars with the expectation to grow audiences first and worry about returns later.

  • Up until July, Apple gave people a free year of Apple TV+ for buying one of its devices. Anyone who buys a new iPhone this fall still gets three months of free access to the service.
  • This has helped Apple promote its devices business while also growing the audience of Apple TV+. During the first weekend in August, "Ted Lasso" became the most popular show across the major U.S. streaming services, according to data from streaming aggregator Reelgood.
  • However, thanks in part to those extended free trials, the number of paying Apple TV+ subscribers is still comparably low: The company reportedly told IATSE in July that Apple TV+ had less than 20 million paying customers.
  • Those numbers allowed Apple to pay crew members a lower rate than bigger streaming competitors under new media rules carved out in earlier contract negotiations that were meant to help smaller services compete against industry giants. (Apple has told the media that its crew rates are "in line" with what other services pay.)

Part of IATSE's list of demands was to get rid of these new media exemptions. But at the core, all of the other demands — meal and rest breaks, better pay and increased contributions to the union's pension funds — were also about streaming, because these days, everything in Hollywood is about streaming. And as the big media and tech companies are duking it out in the streaming wars, their foot soldiers were willing to battle a first big fight of their own.

— Janko Roettgers (email | twitter)

This story originally appeared on Protocol.com. Read it here.

Note: Protocol has agreed to be acquired by Axel Springer, whose chairman and CEO Mathias Döpfner is on the board of Netflix.

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People Are Talking

On Protocol: Gaining traction as a Facebook whistleblower seems to require a little PR help, Sophie Zhang says:

  • "Frankly I should probably have hired a PR agency at the start and not tried to do everything myself. That was not a good decision."

Google's Mark Isakowitz thinks the new antitrust bill may have unintended consequences:

  • "It would break a wide range of helpful services from leading American companies, while making those services less safe, less private and less secure."

Lawmakers must do something about crypto, says Mohan Bhagwat, the leader of a Hindu group connected to India's ruling party:

  • "A currency like bitcoin — I don't know which country controls it or which rules govern it. The government should do it. It has to do it."

On Protocol | Workplace: Diversity reports are becoming more common, but some execs are still on the sidelines, Uber's Bo Young Lee says:

  • "There are certain companies whose founders and leaders really believe, 'This is not our place to discuss this.'"

Coming this week

Sophie Zhang will testify in Parliament today. Frances Haugen is expected to testify next week.

Apple is holding an event today. Rumor has it we could see updated MacBook Pro models and a new set of AirPods.

Google will debut the Pixel 6 and Pixel 6 Pro tomorrow, though there's not much mystery left in the announcement.

The Jamf Nation User Conference begins tomorrow. It'll bring together Apple enthusiasts and InfoSec leaders to talk about how to best manage Apple devices.

The Women in Tech Summit kicks off on Wednesday. The three-day event is all online and will cover topics like cloud security and machine learning.

Trans Netflix employees and co-workers will stage a walkout on Wednesday. They're protesting the streaming service's decision to release Dave Chappelle's new comedy special.

In Other News

Facebook can't rely on AI to address hate speech and violence, according to a report by The Wall Street Journal. Engineers said the platform's algorithms aren't robust enough to block out all hateful content, which the company has refuted.

Instagram is worried about losing young users, according to leaked internal documents. Execs' concerns grew over the past few years, so much so that the company set aside millions of dollars for targeting teens.

"Squid Game" is expected to be worth $900 million. The show is wildly successful and didn't cost a ton of money to produce, relatively speaking, at $2.4 million per episode.

Steam banned blockchain games. Anything that lets players exchange NFTs or cryptocurrencies won't be allowed on the store.

Instacart's strike may not be that effective. Sure, most gig workers seem to agree with the demands of the movement, but it's hard to take an unpaid day off from the platform, and many don't want to face retaliation.

Expensify filed to go public. The expense management software company reported some losses last year, but it seems to be on the up and up so far in 2021.

Everything you didn't know about Zoom

Changing your Zoom background so it looks like you're at a coffee shop or a faraway tropical island is like Zoom 101. Going a little deeper into the settings can make you a Zoom power user.

Protocol's Lizzy Lawrence offers some tips for everything from leaving meetings with one click to helping everyone focus during a call. And if you want to get really creative, she explains how to place all of your participants in a virtual setting. Just when you thought you were sick of Zoom, maybe these tips will give it a refresh.

A MESSAGE FROM PROEDGE, A PWC PRODUCT

Target critical skill gaps and close them with engaging and personalized employee learning. Empower your people with ProEdge, the single solution that can upskill entire organizations and help keep them ahead of the ever-changing demands of the digital world.

Learn more

Thoughts, questions, tips? Send them to sourcecode@protocol.com, or our tips line, tips@protocol.com. Enjoy your day, see you tomorrow.

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