Hollywood actors' strike: Decoding two main issues — artificial intelligence and residuals

Hollywood has shut down. After writers' union, Writers Guild of America (WGA), began a strike in May earlier this year, it is the turn of SAG-AFTRA (Screen Actors Guild-American Federation of Television and Radio Artists). For all intents and purposes, until at least one of the strikes is resolved soon (ideally, by studios agreeing to their conditions), Hollywood as we know it, is dead. For without writers, there cannot be scripts, and even if there are already finished scripts, there aren't actors to act them out on the screen. To say the least, this is not an ideal situation for either party — the striking writers and actors, and studios.

While studios possess considerable power and resources, allowing them to endure strikes for extended periods, the individual strikers face a different reality. They are aware that their personal financial sustainability during a strike is limited. However, picketing outside studio premises is their only course of action to advocate for fair compensation, better working conditions, and the protection of their rights.

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The reasons behind theSAG-AFTRA strikeboil down to two main issues.

Artificial intelligence

Studios wanted to use Artificial Intelligence-driven Large Language Models (LLMs) like ChatGPT to write scripts, and this was one of the reasons WGA members took to streets in the first place. But AI, though not specifically ChatGPT, is also one of the reasons SAG-AFTRA members are dissatisfied.

In a supposed proposal that sounds like something from a science-fiction horror thriller or a cyberpunk movie, studios want background performers to be scanned and own their likenesses forever in return for one-day pay. This revelation has sparked concerns about the future of actors' creative rights and the potential exploitation of their digital likenesses. With actors and writers united in their demands for fair compensation and protection against AI manipulation, the strikes take on a new urgency.

A June letter written by the union's general counsel Jeffrey Bennett reads, "SAG-AFTRA maintains that the right to digitally replicate a performer's voice or likeness to substantially manipulate a performance, or to create a new digital performance, is a mandatory subject of bargaining. You cannot unilaterally impose terms in individual contracts that purport to grant these rights."

Also Read:Hollywood studios seek to replace background actors with AI after one day's pay

While the Alliance of Motion Picture and Television Producers (AMPTP), which represents studios, streamers, producers, and distributors, has denied the reports regarding the AI proposal as per CNBC, studio executives have not yet directly commented on the matter.

Streaming services have impacted residuals

Consider residuals in the entertainment business as royalties book publishers pay to authors. While the situation regarding residuals in traditional forms of entertainment was simple, streaming has complicated matters. Unlike traditional TV, streaming shows often have fewer episodes. In the past, successful TV series would generate a steady stream of residual checks for actors and writers. However, the rise of streaming has altered the system, causing negative impacts on their earnings. Both actors and writers are seeking stronger protections to limit the use of AI in order to safeguard their jobs.

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Union leaders claim, not without reason, residual payments at present fail to adequately compensate members for their contributions, arguing that these payments have been diminished by inflation and the streaming industry's practice of providing lower residual income compared to traditional exhibition models.

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