Brian Lehrer: It's The Brian Lehrer Show on WNYC. Good morning again, everyone. Well, after a month-long strike, the Screen Actors Guild and American Federation of Television and Radio Artists, also known as SAG-AFTRA for short, was told by the studios that all negotiations are off the table. Maybe haven't heard this with all the other news going on, but the Alliance of Motion Picture and Television Producers, AMPTP, announced last Wednesday that the differences between the two sides were too great to reconcile and has suspended contract negotiations, even though they recently settled with the writers. Here is SAG-AFTRA President Fran Drescher speaking to the Associated Press on Thursday.

Fran Drescher: They had given us a proposal package. We worked for 36 hours on it. We brought it back to them, we walked them through it, and they left, and then called a few hours later and said we're breaking negotiations.

Brian Lehrer: Joining me now to break down the latest breakdown is Krysta Fauria, Los Angeles-based AP reporter covering entertainment. Krysta, thanks for coming on. Welcome to WNYC.

Krysta Fauria: Hi, Brian. Thanks for having me.

Brian Lehrer: Listeners, SAG-AFTRA members, and I'm a SAG-AFTRA member, many of us who work here at WNYC are SAG-AFTRA members, but I think you know by now that the broadcast industry or this arm of the broadcast industry is not on strike. It's the actors who make television shows and movies, but we want to hear from you striking actors. How are you taking the latest news that the studios have walked away from the negotiation table?

Any producers listening, any representatives of the studios, you can call, too. How do any of you see this strike ending or anyone else impacted by the strike? Help us report this story. Give us a call now at 212-433-WNYC, 212-433-9692, or tweet @Brianlehrer. I guess a basic question here, Krysta, is if they settle with the writers, why can't they settle with the actors? Aren't they the same issues?

Krysta Fauria: That's a good question, and I think there was definitely maybe a feeling that that could happen. Basically, going into last week, the Alliance of Motion Picture and Television Producers, as you said AMPTP, represents Hollywood Studios, and they struck a deal with the Writer's Guild of America at the end of September, which was subsequently ratified last week. Members of the WGA voted almost unanimously to approve this new contract, and then shortly after the deal with the WGA was announced, the AMPTP reached out to the Actor's Guild to resume negotiations.

As you alluded to, this was a big step and a good sign. It was the first resumption of talk since SAG-AFTRA first went on strike back in July. There was definitely a feeling, at least from the outside, that the actors strike could be over soon. When negotiations resumed with writers last month, their strike was over just five days later. The actors and the studios met a few times over the span of a little less than two weeks.

Then last week, late Wednesday night, the AMPTP released a statement saying they were breaking off talks. They said that the gap between the studios and the actors was too great, and that conversations are no longer moving in a positive direction. As we heard from Drescher, they basically said they had submitted this proposal and then she got a call later that night saying they were breaking it off. Go ahead.

Brian Lehrer: I see that it has to do, to get into one of the specific issues, with the demand for a levy that SAG-AFTRA was demanding that the Writers Guild did not ask for. Here is Netflix co-CEO, Ted Sarandos, speaking at a Bloomberg Screentime media forum last Thursday about this.

Ted Sarandos: We said, look, we agree that we could entertain a success-based bonus, which led to this transparency issue that we were able to get to where we would share the viewing data with the Guild. Like I said, that issue that resolved with the writers was not only accepted in the deal but ratified by a 99% vote of the Writer's Guild. I know that all these guilds are not created equal, and they all have different needs and more bespoke needs, but like I said, that is one that worked, that rewarded success, which we agreed with, but a levy on top of our revenue or per subscriber with no insight into the revenue per subscriber or anything, it just felt like a bridge too far to add this deep into negotiation.

Brian Lehrer: That could leave a lot of listeners lost in the weeds. Can you explain the levy a little bit more and what that means? What that Netflix co-CEO called a levy on top of our revenue or per subscriber with no insight into the revenue per subscriber. Ah, what does that mean?

Krysta Fauria: [chuckles] Well, so basically, Drescher was transparent about this in my interview. She basically said that they are asking for 0.57 per year per subscriber. She repeatedly has gone back to this idea that this residual model is outdated and that it needs to be changed, and they believe it's an important update to that model. The AMPTP said this would cost the companies an additional 800 million a year, which they said would create an untenable economic burden, but SAG has said that that figure was overestimated by 60%. They said that to subscribers the day after this all happened.

Obviously, I think a big part of it is Sarandos and AMPTP in general is just talking about the numbers of what this would cost. I think Drescher and SAG, a lot of what they're saying is that it doesn't matter. I'm not really concerned with the cost. You can't use this just, 'oh, how much money is going to actors' because you need to look at it on how much is each one being paid? You know what I mean?

Brian Lehrer: I do. Here's a text that's come in from a listener. It says, "We are desperate for the studios to return to the table and negotiate in good faith to come to a resolution." Someone else writes, "Thousands of crew members and behind-the-scenes workers are hurting and need the talks to resume ASAP. People are losing health insurance, life savings, housing, taking money from retirement funds, et cetera." Both of those texts, Krysta, referred to the negotiations not happening at all right now. Why did the studios walk away from the table, per se, rather than just reject the latest proposal and continue to negotiate?

Krysta Fauria: That one, it's hard to say. I'm not really sure. That's definitely the feeling that I've gotten from SAG-AFTRA and especially from Drescher in her interviews is that she doesn't understand to what end they're doing this. She's repeatedly called it the silent treatment and said that it's counterproductive and disappointing. The idea that they're conveying at this point is that it's sort of the ball is in the AMPTP's court. There's a lot of reasons you could speculate to why they would be not wanting to be at the table, but obviously, they're going to have to come back at some point if they want to make a deal.

Brian Lehrer: During that interview with the Netflix CEO that we played the clip of, moderator Lucas Shaw, who's the managing editor of Media and Entertainment at Bloomberg News, began his interview by noting, yes, Netflix is profitable, but it's not gaining any more subscribers hand over fist like it used to, and noted that competitors to Netflix are losing money. Said it's also questionable whether Netflix is as big as TV was in its heyday. That being said, what are the economics driving-- I realize that's a complicated question, but maybe what's a piece of the economics driving the new model for how people get content?

Krysta Fauria: Part of this is that it's complicated to know-- it's hard to know because these companies, tech companies in particular, have been so tight-lipped about their finances and they are not very transparent about it, which I think is one of the big issues that has come up repeatedly during these negotiations. It seems like there's differing philosophies on what they're doing.

I think Dresher comes to this and is repeatedly saying, "You guys got into this business not understanding the business, and so you're coming to me and surprised that this is going to cost this much when this is just what it costs to make movies, to make TV." I think what she alluded to at least was that they have fundamentally different ideas about why they're in this. I think she is frustrated that they're not understanding the actual cost of what it is to make to make content, for lack of a better word.

Brian Lehrer: Listeners, if you're just joining us, we're talking to Krysta Fauria, Los Angeles-based Associated Press reporter covering entertainment about the breakdown for now and talks between the television and movie actors and the studios, even though they came to an agreement with the writers recently. We're talking about the issues that they can't get to yes on. 212-433-WNYC, 212-433-9692. Here's Buzz in the Bronx, says he's an actor. Buzz, you're on WNYC. Thank you so much for calling in.

Buzz: Hi, there. I'm trying to use radio-appropriate language when I hear someone like Ted Sarandos say that we insisted on levying $0.57 cents per month for-- it's ridiculous. These are examples of how things will shake out because the reality is once this is all settled, however long it takes, and God, I hope it's soon, there probably will be less content available, and they will charge their subscribers more. It isn't because that the actors are so greedy because they would like to replace any gains that the actors would achieve later on. It's dishonest what I'm hearing from the AMPTP. I know I'm biased, of course, but it really is ridiculous some of the things they're saying.

Brian Lehrer: What would you like to see as the solution?

Buzz: Well, I'm not in the room of the negotiations and it takes-- I'm an actor, not an accountant, and I don't deal with spreadsheets as well, but the profits that these companies are getting are huge. I want everybody to make money, but we just want to be treated fairly. You have so many of our members who are not qualifying for their health insurance, for instance, who have to take other jobs. They can't do anything. I live in New York City, which has had very vibrant film economy. It shouldn't be that way. It hasn't been that way. It's been degrading for several years and we get to this point. The pandemic and streaming just was a final nail in the coffin.

Brian Lehrer: Buzz, thank you so much for your call. Good luck. Jody in Newark, you're on WNYC. Hi, Jody.

Jody: Hello, Brian. I've just turned off the radio.

Brian Lehrer: Thank you. No seven-second feedback. Go ahead, Jody.

Jody: I enjoy listening to your program so much. I start my every day with it. I'm calling because I see it as an overall problem, the talks and everything, and not coming to the table and the silent treatment as it's called. For me personally, it's about the sharing of wealth. I think we have people at the top who are hoarders of money. On top of that, I think there's a psychosexual component to this of enjoying watching people suffer, and not giving enough money, and not sharing with people. People fighting for $23,000 to get healthcare is ludicrous with the kind of money that other people are getting within the industry itself at the top, studio heads, the top A-list actors as they're called. That's my thoughts.

Brian Lehrer: Jody, thank you very much. Alan in Weehawken, you're on WNYC. Hi, Alan.

Alan: Hi, Brian. I think this is a pretty basic negotiating tactic by the producers. They've made a deal with the writers. The deal with the writers is ultimately going to be the deal that they're going to make with the actors, but right now, because of the time off, because of the strike, there wasn't much scripts in the pipeline. It's going to take a few weeks, few months to get stuff ready for pre-production and casting anyway. My guess is the studios are saying, "Screw them, let them sweat it out, and if they want to come back to the table and make some concessions with us, great. If not, we'll make the deal eventually."

Brian Lehrer: Huh.

Alan: I think if we just hang tight-- If we hang tight, then we're going to get everything that we want.

Brian Lehrer: Alan, thank you very much. Krysta, that's an interesting theory that it's going to take time to ramp up again as the writers come back to work, so they're just holding out to not have to pay the actors during this period, if I'm understanding the caller correctly, and ultimately, it's going to be something similar to what the writers got once the studios are ready to actually produce again.

Krysta Fauria: That's definitely a possibility, and I think that that is-- I think Drescher has alluded to that, that the longer that they wait the weaker, in theory, the AMPTP hopes the resolve of the actors is. I think it's definitely a possibility that, obviously, they're just ramping up again and don't really have scripts to necessarily be making at this point. They're not in a huge rush possibly.

Brian Lehrer: Right, but also that the studios would be weaker, continuing to lose money over time, and more anxious to make a deal, but I guess in a very contentious negotiation like this, each side is waiting out the other to see who becomes more desperate. Right?

Krysta Fauria: Right. I will say, Brian, I think it's worth noting that the writers had their own false start in negotiations about a month before their successful round of talks, but I think what might be different here is that there was some sense of optimism going into these ones that it could be over soon because a deal had been reached with the WGA.

Brian Lehrer: Francie in Queens, you're on WNYC. Hi, Francie.

Francie: Yes, Brian. I think talk is cheap and time is money, whether you're in Hollywood or anywhere on planet earth, but the bottom line, unfortunately, the big picture is that when everybody returns to the industry, there is no longer a big picture. This is truly a line in the sand. Heretofore, content was king, it was a maniac. [unintelligible 00:16:36] was the more the better, and boy, was there a lot. Let's face it, it was not all quality, but it was jobs, it was work product, it had a ton of eyeballs on it, and everybody was flush. When we all come back, the picture is much smaller. That's why, in my opinion, it is so vital that the bottom line be really tailored and precise.

The industry, particularly the producers, must not be allowed, they played Russian roulette in the past, that card game is over, they must not be allowed to place on the back of actors their failure to put up effective legal guardrails on who could have access to their live streams. That was their fiduciary responsibility to themselves and their shareholders. Their failure to do that cannot now be wiped out on the back of actors at the negotiating table. Actors must get a piece of the pie. They must get a piece of the action that will show a parody of esteem, both from the producing community to the acting community, and vice versa. Without that leverage, there is no deal worth engaging. Thank you, Brian.

Brian Lehrer: Thank you, Francie. Very interesting stuff. We're going to take one more call from an actor, and thank you all actors, other SAG-AFTRA members for calling in. Jonathan in Montclair, you're on WNYC. Hi, Jonathan, turn off your radio because I can only stand to hear my voice once. Go ahead.

Jonathan: No. Thanks for-

Brian Lehrer: Yes, we're good.

Jonathan: -taking my call. I have a bit of a conspiracy theory. Pretty much I just think that they're holding off pretty much just to hurt other studios. I think the studios with money know that some of the studios without money can't go prolonged without content. It makes sense-- the WGA strike was the biggest hurdle to get over. In a sense, the SAG-AFTRA strike should have been finalized closely afterwards, but some of these bigger studios that can afford to go a couple more weeks or a couple more months without production or content are really going to kill some of these smaller studios. How many streamers are there?

Brian Lehrer: That's a very interesting conspiracy theory. Krysta, from your experience as an LA-based entertainment reporter for the AP, do you think there might be anything to that?

Krysta Fauria: Obviously, we can't know, but I will say that Drescher has, in my previous interviews with her, has talked about the awkward nature of these negotiations with the AMPTP, because apart from the negotiations, they are competitors. There is definitely some merit to the idea that they're in a weird spot with each other, and that in reality, they are competitors. They're not buddies.

Brian Lehrer: If the big studios can wait out the little studios and see some of them collapse, and then there'll be more concentration of wealth and more profits for the big fish. That doesn't mean there's going to be more jobs, unfortunately, for actors or writers or anybody else, but, well, who knows? Maybe that's a factor. I want to play one more clip of SAG-AFTRA President Fran Drescher before you go. This is about AI, using artificial intelligence to imitate and produce the likeness of actors, which some fear would replace actors altogether or in a frightening number of roles. It impacts every member, potentially, but it's particularly important for the major Hollywood stars as I've been reading. Let's take a listen to more of your interview with SAG-AFTRA President Fran Drescher on Thursday about this.

Fran Drescher: They don't want to hear about it because they keep giving us this huge inflated number of how much they're spending on production, and how much they're paying out to our union in salary, but it's all divided up amongst so many thousands of people that it doesn't add up to anything except for our highest paying earners, which I have zero problem with. We're fighting for them as well with AI. They're very concerned about their likeness, their essence of being. The thing that makes them a star is going to be ripped off, going to be turned into something that's hardly even recognizable.

Brian Lehrer: That was a very interesting clip to me when I heard it, Krysta, because I guess, as an outsider, I would've guessed that it would've been the opposite. That for the big A-list stars, pick your one, whoever it is, they have their personality, they have their uniqueness. People want them, they don't want to artificial likeness of them, but that it would have the potential more to hurt actors who are not the most famous ones, who could more be replaced by a computer program. Which is it? Then we're out of time.

Krysta Fauria: I think it's a both and for sure. Obviously, the people, the A-listers, and I was just talking to one last week who was terrified of his likeness being used. I think there's definitely merit to that and for a good reason. We've already seen this being used with people who have passed away and things like that, and so that is a real thing. You're right, that I do think we've seen in their negotiations, that the AMPTP is actually looking to pay basically background actors for day rates and then it use it in perpetuity, it said.

There's definitely a both and, and I do think it certainly would hurt in the short term, at least financially, the everyday journeyman actor more than the big stars, but certainly, it's a both and. I think that's one of the reasons. I'm glad you brought this up because I do think this is another one of the big points that is making this negotiation more complicated than the writers.

Brian Lehrer: 20 seconds, do you do predictions? How does this end?

Krysta Fauria: I don't do predictions. They're waiting for the AMPTP to come back. That's it.

Brian Lehrer: All right. Negotiations currently suspended between the producers and the actors. We leave it there with Krysta Fauria who covers entertainment in LA for the Associated Press. Thanks for joining us and getting up early to do it. We really appreciate it.

Krysta Fauria: Thanks for having me, Brian.

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