A day after the industry’s writers overwhelmingly voted to authorize a potential strike, Netflix co-CEO Ted Sarandos weighed in on how the streamer might fare if a work stoppage does become a reality.
“If there is one, we have a large base of upcoming shows and films from around the world. We could probably serve our members better than most,” the executive said on a Tuesday earnings call for the streamer. “We really don’t want this to happen but we have to make plans for the worst [-case scenario] and so we do have a pretty robust slate of releases to take us into a long time.”
Contract negotiations between the union the Writers Guild of America and the Alliance of Motion Picture and Television Producers (AMPTP), which represents the studios and streamers, have been ongoing since March 20, with the parties last meeting on Monday. That same day, the WGA announced that nearly 98 percent of its members had voted to authorize strike in a record-setting referendum that was also unprecedented for the union in terms of its turnout.
During his Wednesday remarks, Sarandos was careful to clarify that “we’re at the table and we’re going to try to get to an equitable solution so there isn’t a strike.”
The co-CEO — whose service was largely a DVD mail-order business that was at the outset of its streaming push when the writers last struck in 2007-2008 — called that work stoppage “devastating to creators.” He added that it was “really hard on the industry, it was painful for local economies that support production and it was very, very, very bad for fans.”
While the future of the writers’ contract — which expires in less than two weeks, on May 1 — remains up in the air, Sarandos still projected a rise in content spending over the next few years. While noting that this expenditure depends on revenue growth, the co-CEO estimated that the service will be “back to about the $17B level in 2024.”
As rumors of a potential writers’ strike have swirled around the industry for months, companies have attempted to prepare by stockpiling scripts, handing out early renewals and amassing unscripted titles that are not beholden to unionized writers. If a strike does occur, Netflix could potentially benefit from its habit of working far ahead of its release date on some shows, which Sarandos touted in 2020, at the height of the COVID-19 pandemic’s disruption to the industry. “One of the benefits of releasing our series all at once is that we work very far ahead of our release cycle,” he said during a July 16, 2020 Netflix earning call. “So that’s how we’re able to continue to release this ongoing steady flow [of titles during the pandemic].”
While studio and streaming executives have remained fairly quiet over the course of the writers’ negotiations, during an earnings call earlier in the month Warner Bros. Discovery president and CEO David Zaslav said he was “optimistic we can get through this in a way that’s fair to all parties.” (Zaslav also promoted the array of content that would be ready to go on his company’s streamer, Max, if a work stoppage were to occur.)
The AMPTP, meanwhile, said in a rare statement on Monday that the WGA’s ratification of a strike authorization was “inevitable” and that a deal “is only possible if the Guild is committed to turning its focus to serious bargaining by engaging in full discussions of the issues with the Companies and searching for reasonable compromises.”
