Videoage International January 2021

22 January 2021 V I D E O A G E Hol lywood Exodus the course of the year, ViacomCBS laid off over 550 people, too. Across the industry, an estimated 30,211 jobs were cut in 2020, according to international job placement company Challenger, Gray & Christmas. This number is only one percent less than the total layoffs in 2008 during the financial crisis. But we need to add 10,000 job losses in 2019 and 15,474 job cuts in 2018 to that. The landscape looks grim for those who want to make their film and TV business dreams come true, especially in the center of the industry, Los Angeles, California. The layoffs are in response to lower revenue caused by the COVID pandemic. But since demand is always present, and content will be delivered through new and imaginative methods, the industry will refocus and rebuild. Those who create content are compelled to do so and they usually can’t simply go off and become dental hygienists. Distribution of that content will shift, but more of it will be available, and the industry will regroup, retrench, and then grow again. Displaced executives may end up back at their old companies, when production and distribution pick up. Until that happens, however, their skills can be adapted readily to new industries — OTT companies still need financial expertise, content knowledge, production skills, sales and marketing expertise, public relations staff, and the like. The executives who handled that at the companies discussed above, before the pandemic claimed their jobs, will likely transfer those skills to new companies. It would not be surprising, however, if many of these executives realize they will be subject to layoffs, downsizing, and reductions in force wherever they may apply for a job. As a result, many will start their own shops, alone or with colleagues, putting a different spin on the work they do, with different, potentially more demanding bosses — themselves. While there are job cuts, there are many new pipes delivering content to the home, bypassing movie theaters. Aside from the “old timers” (Netflix, Amazon Prime Video, and Hulu), newcomers are flooding the market. Disney Plus, Peacock, and HBO Max are new streaming entrants. Paramount Plus (formerly CBS All Access) is beefing up its profile. Plans for new streamers abound. Each of them will have exclusive content. Based on these new proprietary pipelines for delivering content, studios and networks have determined that since they have an abundance of content on hand, they can stream that content, on their own networks, cost to the consumer be damned. Those networks will all need new and additional compelling content to satisfy the demand. But even that demand will be tempered by the limits faced by consumers. After all, how many streaming services can a home afford to have? Those big, fat pipes permitting on-demand viewing of all kinds of content need to be filled with content. That content will be created differently in 2021 than it was in 2019. (We don’t even need to talk about 2020.) Perhaps some crew roles will be automated. Maybe a non-union boom operator can be replaced by a device. Technological advances will serve to reduce the costs of production, freeing up more dollars for more productions, which will fill the Media Job Losses In Facts & Figures I n November, the Chicago-based job out- placement company Challenger, Gray & Christmas estimated 30,211 job losses in the media sector. Of these, 16,160 occurred in news (print, broadcast, digital news). The rest were in advertising, television, streaming, and movie production. By comparison, the sector saw just over 10,000 job losses in 2019 and 15,474 in 2018. Job losses in the U.S. spiked in May during the first wave of the pandemic and then increased again over the summer. Several major media conglomerates, including ViacomCBS, Comcast (NBCUni), Disney and AT&T (Warner Bros.) have reduced their workforces since the start of the pandemic. According to The Wall Street Journal , layoffs at Warner Bros. could reach 20 percent of its labor force. At Lionsgate, the layoffs reached 15 percent. AMC Networks cut about one in 10 workers. And ViacomCBS laid off 450 people in May, citing economic conditions. But as early as February 2020, ViacomCBS laid off 117 people due to consolidation at the company. NBCUniversal laid off five percent of em- ployees in its television and streaming de- partments, and has plans to cut one in 10 workers. In the talent agency sector, in the seven major U.S. agencies, dismissals reached an estimated total of 1,100 employees. In the video game industry, a counter on the website videogamelayoffs.com clocks the number of employees laid off since January 2020, and at the end of December, that number was 1,850. Job losses in the U.S. ad agency sector is estimated at 50,000. Despite the number of job losses, the media industry barely cracked the top 20 industries for layoffs, according to Challenger, Gray & Christmas. The leisure industry led with 857,620 layoffs (including 32,000 employees at Disney’s parks), followed by retail with 179,520, and transportation, with 159,674. The U.S. media sector has posted 1,586 hiring announcements in 2020, more than double the 622 posted in 2019, but Colleen Madden, director of public relations and research at Challenger, Gray & Christmas, explained that, “With the job market currently stalling in many sectors, it may be difficult to predict where some of these workers find new employment. Those in news may find new jobs in outlets that are currently doing well — The Washington Post just announced a hiring surge and The New York Times and The Wall Street Journal have been hiring. For entertainment — television, movies, advertising — depending on the skills they have, they could find employment producing content for non-traditional media companies, streaming companies, or corporations with large marketing budgets.” DS streaming pipes. But at the same time, some of those jobs, which were filled by individuals, will be automated, and thus eliminated. The unions will eventually lose that battle. For the near term, a government remedy may work. There is legislation pending in Congress, by Representative Carolyn Maloney (D-NY), that will allow insurers to rely on the federal government with regard to claims generated due to COVID-19. If a production that follows industry protocols must shut down because a key staffer is infected, insurers currently won’t cover that loss, either on a general liability policy or on a completion bond. If the federal government is in place as the intended “backstop,” the insurer will suffer some loss, but the federal government will protect the insurer from significant loss and will provide the capital to cover the loss, thereby allowing for the production to resume. Significantly, this backstop will allow the production to move forward in the first place, which alone will assist in the creation of jobs in the independent sector. Without a completion bond, or general liability insurance, independent films (especially those financed with debt, where the loan must be repaid on delivery) cannot proceed. As of this writing, studios and other well-capitalized companies are shooting films, and “taking the risk” that COVID-19 causes a shutdown. That financial risk is predictable and can be borne by deep-pocketed companies. With the independent sector creating more and more content, the need for this insurance grows. Rep. Maloney’s legislation would be a boon to the film and TV industries. As the vaccine is distributed, and more people are protected from COVID-19, the number of productions will increase. But it may well take the entire year before productions return to normal volume, without the extensive and expensive COVID protections mandated by the guilds. Until then, however, the industry will adapt, as it always has, from threats that have included television, cable television, video-tapes, DVDs, and now COVID-19. (By Marc Jacobson*) (Continued from Cover) * Marc Jacobson is a New York City-based entertainment lawyer. “Higgins, did you order 150 pink slips?”