Actors delay potential strike against studios and streaming services, extending contract negotiations

By Chris Isidore, CNN

New York (CNN) — A union representing about 160,000 actors has put plans to go on strike against major studios and streaming services on hold.

The contract between the actors and an alliance of studios had been due to expire at midnight Friday. But late Friday the Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) announced it would push back the expiration until 11:59 p.m. PDT on July 12 as it continues negotiations.

“In order to exhaust every opportunity to achieve the righteous contract we all demand and deserve, after thorough deliberation it was unanimously decided to allow additional time to negotiate by extending the contract,” said Fran Drescher, the star of the 1990s sitcom “The Nanny” and the current president of SAG-AFTRA, in email to members Friday night.

Drescher appeared to be addressing some leading actors who have been publicly pushing the union to take a hard line in negotiations by ending her email: “No one should mistake this extension for weakness. We see you. We hear you. We are you.”

The decision to delay the start of a strike was not a surprise, as a number of industry experts had been predicting just that. But that doesn’t mean that a strike will now be avoided, said Jonathan Handel, an entertainment lawyer and writer and author of a book on the 2007-08 writers strike, “Hollywood on Strike!: An Industry at War in the Internet Age.”

“There will probably be a strike,” he said earlier in the week, before the delay was announced. “While discussions have been productive, it does not necessarily mean they’re close to a deal.”

Film, TV production already disrupted by writers strike

If the actors do go on strike, they would join 11,000 members of the Writers Guild of America, who have already been on strike for two months. If a strike is avoided, it would put pressure on the WGA to settle, since the studios have already reached a deal with a third major Hollywood union, the Directors Guild of America.

Production of many movies and television shows have already been shut down by the current writers strike. An actors strike would bring most remaining productions to a halt, other than on some independent films not associated with studios. There has been no visible progress in ending the writers strike since it started. Now, there are concerns that if the actors join the writers on strike, the shutdowns could stretch through the summer, maybe even through the end of the year.

The actors union has not been on strike against television shows and movie productions since 1980. The industry has obviously changed radically since then, when most shows were on just three broadcast networks and movies were only shown first in theaters. Video rental giant Blockbuster hadn’t started yet, let alone been forced out of business by streaming.

The difficulty of coming up with new contract language to cover the age of streaming services and artificial intelligence is what makes many people doubtful a contract can be reached without a strike.

“This is a sea-change negotiation,” said David Mumpower, a media expert, chief content officer of Mickeyblog, which tracks news about Disney, and co-host of the “Streaming into the Void” podcast. “And if they get it wrong now, they’re going to have it wrong for decades.”

But it also comes at a time that the major media companies and tech companies that have jumped into the world of streaming services are focused on cost cutting and profitability, rather than just subscriber growth as they were a few years ago.

The Alliance of Motion Pictures and Television Producers (AMPTP), which is negotiating on behalf of the studios, includes Amazon (AMZN), Apple (AAPL), CBS (VIAC), Disney (DIS), NBC Universal, Netflix (NFLX), Paramount Global, Sony (SNE) and CNN parent Warner Bros. Discovery. Many of those companies have seen drops in their stock price in the last year, prompting deep cost cutting, including layoffs.

Earlier in the week it seemed as if a deal between studios and actors could be reached before the deadline. Drescher recorded a video message to members saying that the union was having “extremely productive negotiations” with AMPTP.

Stars sign on

But after that, there was a letter signed by many high profile actors and actresses, including Meryl Streep, Glenn Close, Jennifer Lawrence, Bob Odenkirk, Mark Ruffalo, Quinta Brunson and Rami Malek, among others, urging the union to take a hard line. The letter said they were prepared to go on strike for the contract that members need going forward.

“A strike brings incredible hardships to so many, and no one wants it,” said the letter. “But we are prepared to strike if it comes to that. And we are concerned by the idea that SAG-AFTRA members may be ready to make sacrifices that leadership is not. We hope you’ve heard the message from us. This is an unprecedented inflection point in our industry, and what might be considered a good deal in any other years is simply not enough.”

More than 300 actors signed the letter initially, and the signature count since climbed to over 1,000, according to trade publication Deadline, with Charlize Theron, Joaquin Phoenix, Jamie Lee Curtis, Cobie Smulders and Pedro Pascal among those who have signed on.

Interestingly, Drescher herself has signed the letter.

The issues in the actors negotiations are some of the same as in the writers’ strike, including not only increased pay but progress on residuals paid for when films or shows are shown again, particularly on streaming services. Streaming platforms have been repeatedly removing older films and episodic shows from their services. Reducing payments of residuals is the main incentive to do so.

There are also concerns on potential increased use of artificial intelligence, or AI.

“We all agree AI is going to be used. We don’t know yet how it will be used,” said Tom Nunan, a lecturer at the UCLA School of Theater, Film and Television, as well as a film producer and writer.

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