Major Hollywood studios and streaming platforms are considering terminating first look and overall deals with writers as early as August 1, according to industry insiders. The move comes as the Writers Guild of America (WGA) and SAG-AFTRA continue their strike, causing significant disruptions in the entertainment industry.
Producers, including Amazon, HBO, Warner Bros. TV, NBCUniversal, Disney, and CBS Studios, had previously suspended many of these deals in May, only a week into the strike. However, as the labor conflicts persist, studios are now contemplating terminating these pacts altogether under contractual force majeure clauses.
This decision is seen as a drastic but necessary move by industry insiders. The termination process is expected to be more complex than in previous strikes due to the surge in content production and the prevalence of first look and overall deals.
While some top talent, such as Ryan Murphy, Shonda Rhimes, Taylor Sheridan, and Tyler Perry, have contract clauses that protect them from individual termination, studios would need to terminate all term agreements to avoid legal complications and prevent the loss of creators to rival studios once the strike is over.
However, it is unlikely that studios will terminate all agreements as they are already saving money by suspending deals. The potential savings from terminating these deals are also negligible when compared to the potential public relations backlash that studios may face.
The WGA has been advocating for better contracts for its members, but mid-range writers with first look and overall deals are more vulnerable to force majeure termination. As work on current projects slows down, more deals may be suspended in the coming months.
The outcome of these terminations will largely depend on the relationships and culture within each individual studio or platform. While some studios may choose to terminate deals to cut costs and navigate through the ongoing strike, others may opt for more collaborative approaches to sustain their relationships with writers.
In the midst of this labor conflict, the fate of first look and overall deals hangs in the balance. As August 1 approaches, writers, studios, and streaming platforms anxiously await the decisions that will shape the future of the industry.
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