Law & Hollywood

On Nov. 5, 2007, the Writers Guild of America, West, and the Writers Guild of America, East, went on a strike. The labor organizations represent radio, film and television writers. The strike began due to a breakdown in contract negotiations between the unions and the Alliance of Motion Picture and Television Producers (AMPTP).

AMPTP is a trade organization representing American film and television producers like NBC Universal, CBS, Paramount Pictures, Walt Disney Company, Sony Pictures Entertainment, News Corp., Warner Brothers and MGM. As a result of the strike, production came to a halt on over 60 popular television shows and the Los Angeles economy alone suffered economic losses to the tune of $3 billion.

Writers Wanted Additional Income from Internet Streaming

During the strikes, writers demanded higher payment on DVD revenues, in addition to a cut of profits from television shows and movies broadcast via the Internet and different types of new media.

Late-night talk shows experienced the first setbacks due to the strike and soon began showing reruns. A lot of prime-time television dramas and comedies were also affected.

On February 12, 2008, the AMPTP and Writers Guild of America came to a tentative agreement, and guild workers voted in favor of ending the strike and returning to their writing work. The strike came to an official end in late February after the AMPTP and guild members approved a three-year employment contract.

Strike Cost Billions in Lost Revenue and Income

The labor strike had devastating affects across the entertainment industry. The Los Angeles Times estimated that the local economy of Los Angeles lost over $3 billion alone. About $772 million of that represented the lost wages of production workers and writers. About $981 million was lost revenue of businesses that serve the industry. About $1.3 billion was lost from consumers who stopped spending as much money at restaurants, retail stores and car dealerships.