The stunning defeat of Hollywood in the recent battle over anti-piracy legislation is slowly beginning to register with the entertainment industry. Despite being this country’s most important export industry, Hollywood was unable to carry the day for legislation that protects an important cash cow for the US economy.
What happened here and why is it important for the unions in the entertainment industry, particularly SAG?
The key is that Silicon Valley and the telecom world are destroying the old vertical business structures of Hollywood. After decades in which aggregation was the key to success, now disaggregation is the key. There are now dozens of ways to produce and distribute entertainment content. Big capital now flows through hedge funds and venture funds to create these pipelines.
And these disaggregated players are now a political force as well despite the anarchy of their business model. The blackouts by Wikipedia and Google were only the most visible tip of the iceberg. It is not an accident that Obama has visited the Valley a half dozen times in the last couple of years, including stops at Facebook and private dinners with big tech players.
Meanwhile SAG and AFTRA leaders argue that the key is merger – in other words, aggregation in a world of disaggregation. One of the major arguments that merger zealots make is that a new merged union of journalists, musicians and actors will be better situated to deal with, wait for it, large media conglomerates like Fox and NBC Universal. But these are the same groups that just got beat, badly, by a wide ranging network of small and big, private and public, for profit and non profit, technology companies.
And in that victory Silicon Valley won the hearts and minds of millions of consumers who buy into the – inaccurate but persuasive – story that the Valley brings people more choice and cheaper alternatives for entertainment content.
An analysis by Reuters on the debacle for Hollywood contained the following quite revealing assessment of the clumsy bureaucratic response by the congloms:
Some Hollywood executives acknowledge their own flat-footedness in trying to marshal public opinion as opposition mounted. While technology companies brandished the power of the Internet, Hollywood relied on old-media weapons such as television commercials and a billboard in New York’s Times Square. It proved to be too little, too late.
One entertainment-company lawyer complained that opposing arguments were often inaccurate but spread like wildfire anyway on the Internet, leaving supporters scrambling to correct the information without the benefit of a strong online network.
“We do some of that (online) stuff, but it has to go through a committee of 14 people,” he said. “The other side doesn’t have conference calls. They just put stuff out there.”
A merger of SAG and AFTRA, in other words, is a solution to last decade’s war not a credible response to the battles that actors (and journalists and musicians) will face for the next generation.
Some time ago, I proposed an alternative to the merger of SAG and AFTRA. Now it seems prescient and so I put it on the table again. Instead of merger, instead of the time consuming, overwhelmingly complex and expensive process of forcing under one roof very different cultural and political organizations, the entertainment and media industry unions need to form a strategic leadership council.
This council would be formed by rank and file elected representatives who base themselves in both New York and Hollywood with a small professional staff that has as its purpose the generation of concrete ideas for improving the bargaining power of the industry workforce. It would include IATSE, the IBT and CWA as well as the guilds. It should have a seat at the table of the AFL-CIO executive council as well.
Such a council would only be as strong as its ability to develop new ideas for horizontal action across the guilds and crafts as opposed to bureaucratic, staff dominated vertical efforts. This horizontal approach could include coordinated bargaining, attempts to build direct relationships outside of collective bargaining with Silicon Valley, efforts to make a public argument about labor’s role in the industry that is not controlled by the AMPTP.
Over time, as success builds trust and confidence, new organizational structures could emerge. But there is no magic in mergers and SAG is now on a path for a bloody internal fight that will only harden factional lines. Even if merger gets past the 60% hurdle those hardened battle lines will be brought into AFTRA. Those journalists and musicians not familiar with SAG culture will be alienated. A weak and ineffectual union is a distinct possibility.
A council approach, on the other hand, is democratic, transparent, controlled by rank and file members and allows a great deal of flexibility and creativity to take hold. When you go up against Silicon Valley that is a very powerful weapon.