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Why writers are having a hard time earning a living in the streaming economy

A MARTÍNEZ, HOST:

Members of the Writers Guild of America are on strike, and they say they can't make a living writing for the streaming platforms. We wanted to understand how the streaming services are different and how the strike might change the streaming industry. Paul Hardart is a professor at the NYU Stern School of Business. Earlier in his career, he was a Hollywood executive.

Paul, so why does working for a streaming studio like, say, Netflix change a writer's ability to make a living?

PAUL HARDART: Oh, it's a really good question. I think the main difference is it used to be that the incentives were linked. So the writers and the studios were trying to get people to watch the show and get high ratings and get people to pay attention to the show. Today, the streamer is trying to get people to subscribe to their service, so they're looking more at the aggregate of the service versus the individual show.

MARTÍNEZ: And the shows are typically - what? - like, eight episodes, right? Not a typical network show that's - what? - 20 something.

HARDART: Yeah. And if you think of your own habits - right? - some of the shows that are popular now have big stars. And they go for maybe four, five, seven, eight episodes or, if it's a series, may only last for two to three seasons versus if you had a popular show in the past, it could go for as many as 10 or 12 seasons.

MARTÍNEZ: So then given how many streaming services are struggling to show profits, how could studios then pay writers more, I mean, even if they wanted to, Paul?

HARDART: You know, I think the way it's changed is most of these streaming services focus on a metric called ARPU, which is the average revenue per user. You know, they're more aligned with how the overall service is doing. And so I think what's happened is the technology has fundamentally changed how the studios do business. And therefore - and that's also changed how we consume - consumers consume content. And that's led to a totally different paradigm. So I think the strike is basically an indication that the world has shifted and that a new paradigm has to be developed.

MARTÍNEZ: If the streaming services - say they just - like, tomorrow they decided we're going to pay the writers more. How would that change things for the viewers? Would there be fewer scripted shows? Would there be more reality shows?

HARDART: Well, you are looking at things - the increase of sports or unscripted television. But I think, you know, humans and human nature, since the dawn of time, love stories that are written by creative concepts that sort of reflect our humanity. So I don't think that's going away. I think we just have to rethink how we are compensating the writers that are coming up with these amazing ideas.

MARTÍNEZ: Have we been systematically, Paul, over the years, conditioned to maybe adopt a streaming model as a way we watch our television. You know, I mentioned earlier how typically series on network television were 20 something episodes, and now we're getting used to eight. Are we kind of used to the way things are now and not really pining for the way things used to be?

HARDART: Well, I do think - I think of our own, you know, individual behavior. I think - and this has also, you know, sort of accelerated during the pandemic is - you know, there's so many demands on our attention, whether it's TikTok, whether it's podcasting. And so I think there's so much choice that to get our attention and hold our attention has become increasingly difficult.

MARTÍNEZ: Yeah, 'cause I got to admit, Paul, I'm clicking more on the short series than anything longer than eight episodes. So, I mean, I'm kind of contributing to these shorter series, meaning that these writers are getting paid not as much as they would be.

HARDART: Exactly. And that's sort of the challenge. So I think whatever the negotiations involve, they have to address that the world has changed. And you see that even as, you know, AI has been sort of in the public domain for about six months. And that's already something that's a grave concern to the Writers Guild. So you can see, even in the process of negotiating, the world is changing. So I think it's sort of an interesting time. And again, we do have to sort of look at - there's huge amounts of money being spent on content, and there just needs to be a new way of thinking about how people are compensated that basically align interests.

MARTÍNEZ: One more quick thing, Paul. Why would the studios be willing to take these negotiations to where we are now? I mean, what upside is it for them?

HARDART: It's a great question. I think - you know, I think both parties would love there not to be a strike, but it's brinksmanship.

MARTÍNEZ: Good enough answer as any other. Hollywood - former Hollywood executive Paul Hardart is a professor at the NYU Stern School of Business.

Paul, thanks.

HARDART: Thank you. Transcript provided by NPR, Copyright NPR.