The New York Times tends to defend anything that aligns with its political ideology. Rarely does it go against the grain and call things until it is too late to ignore.
This is what might be happening with Hollywood.
As noted in numerous articles, the plight of Hollywood is very difficult. I believe we are seeing an industry in decline, at least from the traditional perspective. This is being driven by technology but it was compounded by the COVID lockdowns and the industries being obtuse.
We will see if it can get out of the death spiral it is in and rebound like it did in the past or if this time is truly different.
NY Times: What After The Oscars?
What is usually a time for optimism is anything but that for Hollywood. The next year, at a minimum, is going to be tough. After the last few years, the industry can ill afford something like this.
Yet that is exactly what the industry is facing. If two strikes didn't compound the problem enough, it is likely a third is on the way. This will be by the people who work in the sets.
Can the industry afford another stoppage?
If “Hollywood” were a big summer movie, we’d be right at the end of Act II, at the always-darkest-before-the-dawn moment in the story, when all seems lost. Or, as one agent put it to me, “A lot of us are feeling like we’re working in the aftermath of an industry, not in an industry.”
Time will tell what happens on this end.
In the ashes of last year, an outline of this new normal started to emerge. It’s a landscape that consists not of just big studios (this isn’t the 1950s) or big studios competing with upstart indies that steal their awards (this isn’t the 1990s) but of a mix of new and old models: studios; indies; streamers like Apple, Amazon and Netflix; and the kind of out-of-nowhere hits, faith-based movies and red-state phenomena like “Sound of Freedom” that keep taking people on the coasts by surprise.
The Hollywood illusion of streaming being the grand windfall is popping. This is going to cause a great deal of fallout for these studios. Instead of raking in billions, they are losing that amount each year. Disney is reportedly over $11B dollars in the hole on Disney+ with no sign of profitability on the horizon.
In fact the only one making money from streaming is Netflix. It is even to the point where some studios are licensing content to that company, leveraging their library for profit.
The problem is the largest studio, Disney, has a market capitalization of $202 billion. Even Netflix tops it at $261 billion. Both of these compare to the near $2T for Amazon and over $3T for Apple.
This provides them with plenty of resources.
Technology The Nail In The Coffin
It is likely the nail in the coffin will be technology.
Part of the dispute last summer was over the use of artificial intelligence. This is going to be a major issue going forward. The agreement reached means nothing considering the fact that AI technology is spreading all over the world.
Not only are the studios in jeopardy of seeing competition from within the U.S., the entire world could be getting into the game.
Perhaps the biggest issue that Hollywood has is the fights.
The linked article lays out how the studios and writers along with actors are at odds. This is compounded by the entire industry fighting their own customers by repeatedly putting out products that are being rejected.
It is is to the point where the coasts are even rejecting what Hollywood is producing. This is evident by the box office failures we saw over the last couple years.
Ignore your customers at your own will.
The market is there so it is only a matter of who will fill it. In the past, Hollywood Studios had the time to adapt. This might not be the case this time.
AI is moving at a rapid pace. We see what programs like Sora are doing. This is being outdone by Haiper.Ai. We are seeing LLMs topping each other every couple weeks.
The technology is so alarming that is caused Tyler Perry to pause the progress on an $800 million studio. He stated that seeing Sora had a major part in the decision.
One final piece in the puzzle is the swallowing of these studios. Amazon already took over MGM, one of the premier entites in Hollywood history. Paramount is reportedly on the block. This will not likely be the end of it.
Even if these studios have success in the future, it could end up feeding that which is swallowing up the industry: major technology companies.
We will see where things stand in another year. If the present trend continues, the situation will be even worse a year from now.
Even the mainstream is starting to notice.