TV’s Streaming Bubble Has Burst, Writers Are Striking, and “Everybody Is Freaking Out”

 

 

 

By Joy Press-Vanity Fair

 

The golden age of streaming didn’t always reward the people who actually mined the gold. Back in 2017, around the time that The Handmaid’s Tale emerged as a global hit for Hulu and became the first streaming show ever to win the top drama Emmy, one of its writers, John Herrera, was working a second job. The good news was that he still heard some solid gossip from Hollywood insiders. Or overheard, to be more accurate: They were talking to each other in the back of his Lyft. “There were a couple of instances of driving people to LAX and dropping them off while a billboard for Handmaid’s was staring down at me,” he says. 

And that was the golden age. The streamers’ appetite for originality and niche programming was once their chief selling point, apart from us not having to go outside. But that’s declined since Netflix’s loss of subscribers caused the company’s market cap to dip $54 billion last year, and Disney, NBCUniversal, and Paramount collectively accumulated more than $8.3 billion in streaming losses. Wall Street, unsurprisingly, is second-guessing the throw-everything-at-the-wall mentality that fueled the streaming arms race. Now, Disney, Warner Bros. Discovery, and others have laid off thousands of staffers, pulled the plug on underperforming programming, and vowed to be more cautious. All the while, the threat of a writers strike has hovered overhead (it began on May 2), slowing production even further. “People are just desperate,” says David H. Steinberg, a writer and showrunner. “I’ve been doing this for over 20 years, and I’ve never been in a situation where people are like, ‘Oh, no one’s buying anything right now.’ We just can’t sell.”

The buyers are obviously not having the time of their lives either. Part of HBO’s appeal has always been that it’s selective about what it makes. Casey Bloys, the chairman and CEO of HBO and Max content, and his team have delivered Succession, Euphoria, The Last of Us, The White Lotus, Mare of Easttown, and House of the Dragon, so you could argue that they know exactly what they’re doing. But several sources say they were surprised and disconcerted last year when HBO pulled the handbrake on what seemed to them like an unusual number of projects. There are all kinds of reasons for not making a series, like when it hasn’t coalesced in the way everybody had hoped, but Bloys now reports to Warner Bros. Discovery president and CEO David Zaslav, who’s on a mission to drive shareholder price up by cutting costs and easing the debt load. “At HBO, the creative direction and commitment remains exactly the same,” the company says in a statement. “All one needs to do is look at our robust slate and it’s obvious that our programming remains unchanged.” And it’s true that big money still flows for potential blockbusters. But there’s concern in the industry that the smaller gems are being sidelined. “In a Wall Street investor call, David Zaslav said that Casey Bloys is a fucking ‘unicorn,’ ” says one dealmaker. “And yet, he’s really just cutting his horn off, you know?” 

To be fair, everybody is learning to curb their enthusiasm. “Wall Street changed the rules of the game,” says Marc Guggenheim, a veteran showrunner. Instead of chasing subscriber growth with great content, streamers are now directed to focus on profitability. “Overnight, all the streamers will suddenly be measured by a completely different yardstick that they weren’t built to meet.” Guggenheim compares the companies to a car speeding down a highway at 100 mph: “Suddenly they slam on the brakes and the car spends a little time skidding out of control. I picture Ted Sarandos white-knuckling the steering wheel going, ‘Okay, well that was fun. But let’s get the heart rate down now.’ ” 

The financial pressure on streamers has caused a parade of panic. “Everyone in the industry is freaking out, because things are getting cut left and right,” says a former studio executive. “What’s being cut big-time is development. And that’s where most of this town is. I’m working on a project. How often have you heard that?” It takes time and care to bring truly original shows into the world. “I’m worried about that pipeline—not just at HBO, but at Showtime, Hulu, FX, and others—getting their budgets cut as things get consolidated,” says the exec. “You get to a White Lotus because HBO nurtured Mike White and Enlightened. You get to an Everything Everywhere All at Once because A24 nurtured the Daniels.” 

Over the past few months, we talked to dozens of executives, writers, producers, crew members, actors, directors, and dealmakers, many of whom asked for anonymity, as people in Hollywood tend to do when they’re going to tell the truth. One award-winning showrunner thinks of the streaming revolution as an earthquake with a series of aftershocks. “And I guess the question really is: At the end of the quakes, are we going to be better off or worse off?” She lets out a ragged sigh. “It doesn’t look good.”  

Without question the streaming boom was a miraculous turn of events for TV addicts who liked their entertainment smart, challenging, and on tap. Platforms lured talent by offering creative freedom and bags of cash up front. No more commercial breaks! No more intrusive network notes like “We’re really craving more heart!” and “We just don’t like her!” Creators could break taboos, experiment with genres, and make binge-worthy masterpieces. The result was a wave of idiosyncratic series that transformed our idea of television. Think of Fleabag’s madcap, sex-soaked journey through grief; Severance’s Orwellian take on office culture; BoJack Horseman’s talking horse and his meta-critique of Hollywood; Reservation Dogs’s imaginative evisceration of our myths about Indigenous Americans; and Station Eleven’s poetic vision of a postapocalyptic world. 

As soon as Netflix started streaming original programming in 2012, every major media and tech company scrambled to get a foothold in this new landscape. The execs had seen the music industry get ambushed by streaming, and nobody wanted to go broke and have to pull their kids out of Harvard-Westlake. Was it clear how streaming platforms would coexist with broadcast and cable? Nope. Was it even clear how streamers would make enough money to justify what they paid top talent? Nope, the sequel. Regardless, corporations threw themselves into the fray. “All these platforms were brand new, trying to make noise and grab cultural attention,” says the showrunner behind a buzzy series. “One way to do it was to have all these highly original, highly creative, highly expensive premium limited series with huge movie stars getting to do a lot of really experimental stuff. It was like funny money that was funding all this as a way of announcing, ‘We’re here! We’re part of the party!’ ” 

The number of scripted series soared. In 2022, 599 English-language scripted shows were released, according to research from FX, which is headed by John Landgraf, the executive who coined the term “peak TV” to describe the glut of programming. That’s more than double the number tallied for 2012 and doesn’t even include unscripted and variety series. (The rise of international shows, many of them riveting, was just as dizzying.) With so many productions on the go simultaneously, the inevitable feeding frenzy ensued—and a lot of good came out of it. Formerly strict hierarchies hired new faces. Streamers welcomed novelists, playwrights, and journalists with open checkbooks. Studios dispensed lucrative “overall deals” to top writers, directors, actors, and producers. (An overall deal means the studio has you locked down, but at least you’re rich.) A handful of household-name showrunners, like Ryan Murphy and Shonda Rhimes, scored stratospheric nine-figure deals, suggesting that Hollywood was a prospector’s paradise. 

But the collateral damage was no joke. The networks used to employ tons of people just to create and shoot pilots for a zillion shows that never saw the light of day. And if a broadcast show did make it into America’s living rooms? It’d have at least 20 episodes every season, which meant people had steady employment on a single series all year. Actors, writers, and directors would also get residual checks every time an episode was rerun, the way songwriters get royalties. For some TV creatives, it could have a big impact on their bottom line if their show was sold into syndication. People in the industry love to trash network TV as timid and formulaic, but it didn’t just bring many of them to the dance, it bought them second homes in Ojai.

Streaming was a sea change. Transparency about viewership disappeared, pilots were gone, TV seasons were drastically shorter, and workers on all levels had to patch together gigs to make what they used to make on one show. Everybody relying on substantial residual or syndication checks was largely out of luck: What does the word rerun even mean now? “Streamers are making the same product but they changed the delivery system, so they barely have to pay anybody any residuals,” says a showrunner. “I make way more from residuals from a network show that I worked on many years ago than I do on anything that I’ve done on a streamer.” It’s only because of the broadcast checks that he can laugh about the time a streamer sent him one for a penny. 

None of the top-tier execs and writers we talked to expects anybody to weep for them, but the streamers’ pivot has upended everything. Like Uber, they changed culture and only then realized their business model was unsustainable. Now they’re aggressively cutting back on deals with talent, the number of original scripted shows they’re making, and the budgets attached to remaining projects. “I certainly know people, myself included, who realistically might have thought a year or two ago that they’d be renegotiating for multimillion-dollar overall deals,” says a prominent showrunner. “Now it’s like, Oh, there’s not going to be any deal for me at all.” In other words, welcome to Peaked TV. 

For a handful of years now, series creators and writers have considered miniroom a particularly ugly word. “The miniroom is one of the most harmful things that has happened to writers,” says another showrunner. Everybody hopes that they will lead to real jobs, but if they don’t? “It’s like every 10 weeks you’re trying to get a new job.” Minirooms—fewer people doing the same amount of work with even less security—are egalitarian in the sense that they seem bad for everyone. (AMC was an early adopter, and many others have made use of them.) TV writer-producer Liz Hsiao Lan Alper says that because experienced writers and novices are paid the same rate in minirooms, some studios are hiring only upper-level writers to get the most bang for their buck. “It’s basically making it so that there are fewer and fewer lower- and middle-level writers who can make a living,” she says. “And in the WGA, most of our diversity is found amongst our lower and middle tiers.” 

This was not the dream, to put it mildly. “I babysat in fancy writers’ houses when I was coming up as an assistant, and I thought, Oh, when I get to that level, that’s what I’ll have,” says writer and showrunner Emily Silver. But she climbed the industry ladder only to discover the steps disintegrating. “The future I saw in front of me—it’s not there. Do I need to sell my house? I’ve seen a lot of people move out of Los Angeles in the last few years, and that is something that has been on my own mind.”

“We haven’t gone on vacation since the pandemic because I don’t know if I’m gonna make any more money ever again,” says one veteran writer. “That’s the panic. That’s what I worry about. The sad part about the business—and I don’t tell this to people that are trying to break in—is that no one tells you when your career’s over. They don’t call you up and say, ‘I’ve got some bad news, you’re never gonna work again.’ ”

If you’re in the mood for irony, there’s plenty to feast on these days: Some folks are now running back to network TV. “There was a moment where everyone turned away from broadcast,” says a television agent. “And then people saw how hard it was in streaming!” One writer points out that, with streamers cutting the number of writers they hire for each show and the number of episodes they’ll pay for, working on a time-tested network procedural is “a dream.” He estimates that writing and producing just one episode of a broadcast show could end up paying $150,000 over time. Knock out a number of them, and you can retire on the residuals.  

Here’s another irony, if you’re still hungry. “Everyone pooh-poohed network television,” says a veteran television writer. “They said, ‘We’re going to make these dark antihero shows, we’re going to take big swings.’ And guess what the streamers want now? They basically want what network shows were 10 years ago. Netflix would kill for a Big Bang Theory.” 

If you think of Hollywood as one giant Tesla parking lot, keep in mind that there are many income brackets in the TV industry. One editor who works on streaming TV series has witnessed real class resentment: “They’re hiring the stars for $5 million for 20 days of work or whatever, and if the star is like, ‘I don’t like that pimple on my cheek’? They’ll spend thousands to remove it in VFX, no question. Do you need that $5 million when this person gets $10,000? Considering it’s supposed to be liberal Hollywood, it’s kind of the worst when it comes to income disparity.” 

The Writers Guild of America is well aware that writers aren’t the only endangered class. “Our employers are squeezing every worker in Hollywood in order to shake out a few more pennies to put into the pockets of the Wall Street boards, who are demanding that they get at least as much—or more—profits than they have in the previous years in order to keep up that growth,” says Alper. “And we’re being squeezed in a way that’s no longer sustainable.” 

In the last few years, Hollywood’s VFX workers have been in demand thanks to the proliferation of special effects–heavy streaming shows and movies, but they say they’re working long hours for low pay in sometimes unsafe conditions. In a 2022 survey, nearly 70 percent of VFX workers who responded felt their work was not doable long-term. “I can’t fathom any future where I can retire,” one anonymous VFX professional confessed in the poll. Another wrote, “Things like stress, depression, and burnout have become built-in aspects of the job.”

“There’s already no middle class in LA,” says a studio executive. “I don’t know how LA as a city sustains itself in future generations because people are just going to make so much less money over time than they have for the last 30 years or so.” 

California, thanks in part to the downturn in entertainment and tech, has gone from a nearly $100 billion budget surplus to a projected $22.5 billion deficit in the last year. 

A lot of people within the industry knew that a reckoning was on its way. “This correction was necessary, and we’ve all been dreading it,” says another studio exec. For one thing, so many series were launched that even shows with marquee names have sunk beneath the waves. Do you remember the Julia Roberts series on Starz last year? What was it called? How about Samuel L. Jackson’s series on Apple TV+? And they were good shows. 

All this has led to some messy moments as corporate overlords try to rein in their streaming Frankensteins. One of the more surprising side effects was the decision by some companies—most notably Warner Bros. Discovery—to pull existing original series off their streaming services or simply mothball shows that have already been shot to cut costs. Prime Video’s new franchise Citadel has undergone reshoots, one television agent notes. “They’re looking at it as a potential global hit, so they can find money for that. And Netflix found money for The Three-Body Problem,” the high-budget forthcoming sci-fi adaptation from Alexander Woo and the Game of Thrones creators, David Benioff and D.B. Weiss. “What’s not happening is the flyers—the shows that gave artists a feeling that anyone could come from anywhere.” 

Cynicism about the industry is, more than ever, the mood of the day. “What they’re doing is going to create an erosion of the quality of the product,” says Brittani Nichols, a writer-producer on Abbott Elementary. “I just don’t understand how you could piss off writers, piss off your audiences, and then tell them, ‘but we need you to sign up for these 18 different streaming services.’ ” Another writer puts it this way, “When someone comes to me with an idea now, I’m like: ‘Who gets murdered, or where are the zombies?’ You can hide cool character stuff in the zombie show, but you can’t just have a show about cool characters anymore.” 

Showtime—which, like HBO, is one of the original prestige cable networks—is being integrated with Paramount+. Chris McCarthy, who oversees Paramount Media Networks and Showtime, speaks plainly about his franchise-flavored ambitions. “We’re not playing to the coast, we’re playing to the center of the country and the coast,” he says. “I think we proved the model first with Yellowstone—that you make a premium scripted series into a franchise, and make it fresh and new.” Franchise fever is also driving McCarthy’s plans to extend the universe of series like Dexter and Billions (look out for Millions and Trillions). “What the franchises do is just set a much more stable base that brings us a mass audience, so we’re much more profitable from the beginning, but then we have to build on that,” McCarthy says. “I think the misconception was the winners are always going to be the ones with the most amount of content, when in fact the winners are gonna be the ones with the most mass hits. And what breaks through that clutter for most people is franchises.”

No one would ever question the rise of Yellowstone and the Taylor Sheridan universe. But franchises aren’t always sure things. “So many hits are made by taking chances, by doing something that hasn’t been done before,” says a studio executive. “A lot of buyers are saying, ‘We’re looking for our Game of Thrones.’ ‘What’s the next Stranger Things?’ That’s never how a hit show comes to be born. That, for me, is the most depressing part of this time.” 

The pandemonium has rattled many of streaming’s creative bosses. “The fact that business is chaotic and you don’t know what’s going to hit is undermining executive confidence,” says showrunner Glen Mazzara. “During the pandemic, people really felt that the audience would not want anything dark, so everybody was looking for a hopeful Ted Lasso–type thing. And then the biggest show of that period was Squid Game, which was dark. Do you understand how terrifying that is for people who have mandates to find anything but that—and yet that’s the one that hits the jackpot?”

Another concern is that this new caution will damage streaming’s gains in terms of diverse programming. “The streamers were ready to take risks and bet on talent in a big way,” says a female showrunner. “In the early days, it didn’t feel like the ordinary system because they were in a rush. They bet on you and they stood out of the way.” Now at many places, she says, “the parent company is getting nervous and wanting to see results and wanting to see profits, so you see them starting to put the brakes on.” And who tends to get shut out whenever there’s a retrenchment? “When these executives are really trying to play it safe,” says a streaming writer, “they’re not going to first-time showrunners who might be women or people of color.”

So what does the next decade look like in an industry where creativity increasingly means Wall Street telling tech companies like Netflix and Amazon what to do? “I have this dystopian vision of the future where it’s like that second half of Wall-E,” says one streaming writer. “We’re all in those pods, constantly being fed content curated for us, but it’s all created by AI.” 

Still, it’s impossible not to feel for the studio execs, given how much pressure they’re under just to survive. “This is a time for us to rethink the way we do things—the way we develop, the way we sell, the way we work with our deals,” says one. “We’ve adjusted our slate to be budget-conscious, whether that’s looking for shows that are in a limited location or can be genre but shot with some constraints. We’re just looking to get wins on the board.” Some of today’s platforms likely won’t survive the cull. Paramount Media’s McCarthy talks about the challenge with the rugged enthusiasm of a football coach urging on his players. “You have to run into change, you have to love it,” he says. “This business is driven by change and that’s the exciting part. It’s like you get to reinvent the world in real time. And create some new ones.”

For those of us who have grown to love the Wild West of streaming, with all its rogue thrills and unexpected treasures, its original voices and undiluted visions, there’s some real sadness at the thought that this was all just a transition to some kind of more profitable new normal. But Garrett Basch, an executive producer, has found a potential upside that’s at least a little comforting. “The past few years definitely have been a gold rush,” he says, “but I also think it’s been kind of a gold rush of trash. A lot of things have been made that probably shouldn’t have been. This fiscally responsible new streaming model is not going to take the talent away—but I think it can help take out the trash.”