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SAG-AFTRA’s Deal with Netflix Signals Changes

Streaming is changing the entertainment industry & the unions representing artists who make it work

Daniel Hinton's picture
Jul 23, 2019

SAG-AFTRA, the 160,000-member union that represents performance artists and media professionals, has signed a collective bargaining agreement with Netflix, Inc.

 

The union’s National Executive Director and Chief Negotiator David White called the deal “a tremendous win for SAG-AFTRA members and for Netflix,” in a press release that also announced guidelines for on-set intimacy coordinators following pressure from #MeToo and the victorious end to a 10-month strike at a global ad agency.

It’s certainly the first of its kind; usually, the trade unions negotiate one master contract with the Alliance of Motion Picture and Television Producers (AMPTP), which represents studios industry-wide. However, Netflix isn’t a member of the AMPTP. This probably means there are more contracts like this to come, as streaming quickly replaces cable and Netflix continues to disrupt the century-old studio system based in Hollywood.

Netflix has been doing a lot lately, both good and bad. In April they announced expansion plans for a production hub in New York City, and Stranger Things Season 3 just came out, but the historic union contract followed the company’s worst week in nearly a decade. For the first time since 2011, subscriptions in the U.S. decreased in the fiscal quarter, and international subscriptions came in way under expectations. Netflix’s content schedule was back-loaded on the latter half of the year, and the fact that they increased subscription prices in May maybe drove people away.

This, of course, triggered stock prices to drop and analysts to question the streaming service’s future. A market that already has Hulu and Amazon Video in it is about to get way more competitive with Disney, Apple, HBO, and NBCUniversal debuting new streaming options within the next year.

Having said that, Netflix still has by far the most subscribers. As the international subscriber base grows, it could easily end up with the first, second, or third largest slice of a trillion-dollar pie.

To their credit, SAG-AFTRA recognized the trends and is adapting accordingly. One of the most notable parts of the new contract covers voice actors who do dubbing work, usually from English to another language or vice versa. This will attract talent to create original content for a multi-lingual audience, something Netflix has focused on doing in languages such as Hindi and Spanish.

On the one hand, enhanced benefits — gains in residuals and exclusivity rights for artists, improved overtime rules for stunt performers, and specific protections regarding sexual harassment, minimum pay, and turnaround time — will attract talent from within the ranks of SAG-AFTRA, and the same could happen for the other trades such as the Writers Guild or IATSE should they start directly negotiating with Netflix. SAG-AFTRA and WGA have their industry-wide contracts with AMPTP expiring next June, and IATSE’s will expire in 2021. Better contracts negotiated in the interim could kick off a race to the top.

On the other hand, having separate contracts and different standards at each streaming service and production studio creates its own problems. Up until recently, the fact that the trade unions’ contracts with the studios and producers applied to so much of the industry was its greatest strength.

To survive, unions and the industry as a whole will have to be smart and vigilant in the face of these changes.

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