labor The WGA Strike Is a Fight Against Silicon Valley’s Gigification of the Entire Economy
Thousands of Writers Guild of America (WGA) writers in New York City and Los Angeles are on strike fighting the impact of technological innovation on their industry and earnings. These entertainment writers are in many ways the original gig workers. Even for unionized writers, job security never lasts more than a few weeks. Much like other gig workers including Uber drivers and DoorDash delivery workers, technological innovations driven by Silicon Valley firms have been used to drive down wages and to justify rewriting the terms of employment in the industry to workers’ detriment. Where taxi drivers saw their work moved onto apps like Uber and its independent contractor model, writers saw their shows moved from broadcast networks to streaming services — with entertainment bosses insisting that residuals, the compensation writers receive on reruns and other future revenue generated from their work, no longer need to be paid.
At their core, the challenges facing both kinds of workers are driven by Silicon Valley’s ethos of rule-breaking in the name of “disruption” that is slowly impacting every sector of the economy. The impact of tech firms on Hollywood began in the 2000s, resulting in the 2007–8 strike, which ensured that streaming services like Netflix and other internet-based media would be covered by the WGA contract.
The primary sticking points of the current strike are about technology. As the WGA West published their list of demands and the companies’ counter proposals, the main issues are the extent to which streaming residuals are based on the number of streams and the preservation of writers rooms (a demand that is about ensuring minimum levels of staffing for writers), which have been threatened by streamers’ movement to shorter seasons than broadcast shows, as well as a ban on the use of artificial intelligence (AI) in the script generation process.
The fight for streaming residuals based on the popularity of the show is the most indicative of technology’s impact on the industry. Historically, writers would work on a broadcast television show, and then every time the show airs, including decades later through syndication, all the writers who worked on the episode would receive a residual payment. Shows like Friends and Seinfeld continue to pay the rent for writers on these shows.
Residuals ensured that writing remained a middle-class job, evening out writers’ incomes between writing gigs. It also ensured that if a show was a hit, the writers got a piece of the money still being made from their creation. Today, writers for hit streaming shows such as Bridgeton or Wednesday stand to receive nothing beyond their initial payment for writing the show; if these shows become a hit or the streamers resell their work, the bosses will make money from the reruns but the writers will not.
The denial of this residual highlights the impact of Silicon Valley’s magical thinking in the entertainment industry. Just look at the math. The WGA West reports that their demands would cost the studios an additional $429 million a year, which is less than half of recent summer blockbusters like Top Gun: Maverick and Black Panther: Wakanda Forever made at the box office. The studios have rejected the proposal, resulting in each of them losing over a billion dollars each in stock value on the first day of the strike. They have the money to pay the streaming residuals, but doing so would require greater transparency in reporting shows’ streaming volume. This threatens the core myth of streamers’ relationship to Wall Street: only growth in subscriptions matters, not profitability.
Ever since Amazon convinced Wall Street that the company was a sound investment despite not running a profit for years, Wall Street investors have flooded money into tech firms such as Uber and DoorDash, which have also failed to prove they can ever consistently turn a profit. In Hollywood, this logic manifested in streaming services like Netflix, HBO Max, and Disney+ arguing that the number of subscribers they hold, not profitability, should be the metric by which Wall Street measures the streamers’ success. The streamers’ argued that if subscriptions continue to grow, they will become profitable eventually.
But subscription numbers, much like determining Uber’s value by the number of rides performed, could be juiced by pouring venture capital money into coupons and subsidized deals, which encourages temporary customers. Unlike Amazon’s years of unprofitability, which resulted in the company’s investment in a vast network of distribution warehouses all throughout the United States and world, all of Uber’s free rides and Disney+’s discounts are not building an infrastructure upon which future earning can be generated — they are a casino-style bet that customers will stay and pay significantly more money in the future.
This system seemed to come crashing down last year, when Netflix’s stock tanked, and the company was forced to introduce advertising to the platform despite years of insisting they would not. Despite this concession, and Netflix’s agreement to share viewership data with advertisers, the union contends the company continues to refuse the level of transparency needed to properly compensate writers for the value they have created. Silicon Valley broke Hollywood’s existing business model with streaming, and no one knows if their new model based on subscriptions will ever even work. If Hollywood studios began paying streaming residuals, they would have to agree to a level of transparency on the number of streams individual shows or movies received, which might reveal that the emperor in fact has no clothes.
As Goes Low-Wage Work, So Goes Writing Work
While the entertainment industry has long been a gig industry, Silicon Valley logic has attempted to further gigify writing in the image of what they did in lower-wage service industries. WGA’s demand to preserve the writers’ room would prevent the industry from becoming staffed largely by freelancers and ensure that younger, more diverse writers can gain experience to move up in the industry, seeks to counter this trend.
For example, the studios are demanding that comedy variety writers be paid only a “day rate” in which a writer’s contract could only be a single day long. Currently, late show writers are only guaranteed thirteen-week contracts; going to a day rate would essentially turn writers in the industry into the equivalent of Uber drivers. There is nothing fundamentally different between writing for a traditional TV show and a streaming service, but the studios are trying to shift to this gig model and eliminate the writer protections, which the WGA has fought for, just like gig apps argued their tech innovations allow them to misclassify workers as independent contractors.
Writers walk the picket line on the second day of the television and movie writers’ strike outside of Paramount Studios in Los Angeles, California, on May 3, 2023. (Frederic J. Brown / AFP via Getty Images)
Making matters worse, the companies are seeking to replace writers with AI technology. The fear is that first drafts of TV shows will be produced by AI, then a smaller number of writers would “punch up” the scripts. As anyone who has used ChatGPT knows, this seems unlikely to produce high-quality scripts. And AI-generated scripts might not even be copyrightable, as the US Copyright Office has ruled that AI-generated artwork is not entitled to legal protections because it is inherently based on plagiarizing past works of art.
The end result is that the WGA strike is an existential battle for the future of the profession. While the challenges to preserve a model that has produced decent-paying jobs is daunting, the situation could be worse. WGA’s last strike in 2007–8 ensured that the streaming services were covered under the WGA contract in the first place. Had the union not won that battle, they might not have survived to this point.
A Model for Taking on Silicon Valley?
If successful, this strike offers a path forward for the labor movement in fighting the gigification of labor and Silicon Valley’s insistence that tech need not follow existing laws or feel beholden to its workers in any way. The WGA stands well-positioned to lead this fight, because they do not fit the stereotypical notion most Americans have of what a labor union is. In contrast to factory-based industrial unions of the Depression and New Deal eras, such as the United Auto Workers or Steelworkers, the WGA is a guild drawing on traditions that precede the AFL-CIO, going back to the nineteenth-century Knights of Labor. During our current tech-based Gilded Age, turning to union models from the last such age could prove useful.
Historically, guilds were formed by artisans to protect the conditions of their industries by establishing standards and ensuring members adhere to these standards. Where a union negotiates with the employer, the guild negotiates with its members, setting standards that members will not undercut. The WGA both fights to ensure that employers follow the contract and that members do not attempt to work outside the contract. But a major problem facing the WGA is whether the actors and directors’ guilds will join their fight or undermine their strike like the directors did in 2007 when they settled their contract before the WGA did. The WGA might get their own members to hold the line, but if the other guilds don’t follow suit, the union could be in trouble. (A solidarity rally last Wednesday which included all the major entertainment unions hinted that this time might be different.)
Furthermore, unlike industrial unions, guild membership is based on demonstrated skill, not merely employment at a given factory. As such, writers “earn” a WGA card from working enough jobs. A major benefit of guilds in fighting tech firms is that they mirror the network structure of these firms. The guild structure matches the reality that writing is gig work. No movie or TV production lasts forever. Many in the labor movement have called for portable benefits to match the reality that workers increasingly move between employers and often work for multiple employers at the same time. Yet the WGA and other artist guilds have been doing just this for decades. They have achieved benefits portability without compromising on core labor issues such as employee status, which have plagued many efforts to provide benefits and rights to app gig workers.
Additionally, unlike an industrial union, guilds maintain standards by negotiating on the number of workers, the price paid, and costs incurred by gig-based employment. Guild unions recognize the hard truth that for gig work to be truly profitable for workers, restrictions must be placed on the number of workers in the industry and the minimum standards of membership in the guild. This is often hard for trade unionists schooled in the industrial unions that have dominated American labor to digest, but it is essential for maintaining standards and full-time employment in diffuse and gig-based industries.
If this strike is successful, the WGA could provide a powerful model of service sector, app-based gig workers to take on their Silicon Valley foes. Where the WGA demands streaming residuals, Uber drivers could demand a say in setting the pay and conditions of each ride, as the New York Taxi Workers Association and the Deliveristas have done in New York City. The WGA is fighting for minimum staffing levels; DoorDash drivers could fight for greater control over the number of delivery workers on the streets. Where WGA demands streaming transparency and no AI, Lyft drivers could demand greater transparency of algorithmic management and tracking, such as a recent CWA-led effort in Colorado.
Uber drivers and their unions see the tech-based similarities between their struggles and the WGA strike. As Bhairavi Desai, president of the New York Taxi Workers Alliance, which has organized Uber drivers, explained, “We stand in full solidarity with writers . . . the mighty Writers Guild gives us hope to push back and win against the tide of Uberization. It’s not about streaming, just like for us it’s never been about an App. The fight is against tech finance upending generations-old labor protections in the name of technology.”
The WGA strike is not only a massive fight to defend decent-paying writing jobs, but also a battle over how the labor movement as a whole can fight Silicon Valley’s tech-based disruption logic, which seeks to expand the gig economy’s abusive and exploitative model into every industry.
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Andrew Wolf is an incoming assistant professor of global labor and work at Cornell University’s School of Industrial Labor Relations.
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