It has been nearly three months without any sort of active production in Hollywood because of the SAG-AFTRA strikes. SAG-AFTRA is the union that represents screen actors, which went on strike on July 14 after they failed to reach some sort of agreement with the Television Producers and the Alliance of Motion Pictures regarding the new deal.
Similar to the WGA strike that began before it, SAG-AFTRA seeks a bunch of similar clauses in its next contract with AMPTP, including transparent residuals from streaming projects as well as defined protections from AI. Seems pretty fair, right?
The demands might turn out to be a double-edged sword since many believe that the streaming data going public will lead to studios being more selective with what they allow to pass. Either that might end up happening, or the prices of the streaming service subscription will greatly increase in order to accommodate the advancing pay system.
Unfortunately for the subscribers, Netflix plans on taking the latter path. As per a report by the Wall Street Journal, Netflix plans to "wait until the dual Hollywood writer and actor strikes end" before the red and black streaming platform raises its subscription prices. It might happen sooner than later since WGA has already reached an agreement with AMPTP last month.
On the other hand, SAG-AFTRA continued its negotiations with the studios this week. The platform hasn’t raised its costs since January 2022. Currently, Netflix has three tiers: premium for $19.99/month, standard for $15.49/month, and standard with ads for $6.99/month. The most significant pricing changes have recently been centered around limiting password sharing, with Netflix now offering an extra member add-on of $7.99/month.
Netflix’s Plans On Keeping Its Content Volume
Netflix’s plan to increase its costs suggests that the company is currently focusing on making up for its impending budget increases externally instead of internally. With Warner Bros. Discovery deciding to archive Batgirl and Disney canceling a nearly-finished Spiderwick Chronicles, it looks like the studios would rather save money by reducing the amount of content they release.
Boxing up completed projects such as Batgirl and Spiderwick Chronicles allows the studios to save pennies and dimes once you look at the bigger picture. However, scrapping films or shows in the early development stage helps the studios allocate possibly hundreds of millions of dollars to residuals for the writers and actors.
In short, the studios are unable to release numerous projects in the refined residual era at Netflix’s low prices. When it comes to the streaming service, it looks like they might be willing to increase the prices of their subscriptions simply to maintain volume.
