WGA Warns Ad Buyers of Potential Strike’s ‘Significant Impact’ on Primetime, Late-Night

The Late Show with Stephen Colbert
Courtesy of CBS

Just as Madison Avenue starts to mull how many billions of ad dollars to earmark for TV as part of the industry’s annual “upfront,” the Writers’ Guild is warning media buyers that a potential strike by its members could dampen Madison Avenue’s couch-potato prospects.

“With the cable networks’ Upfronts underway and the broadcast networks’ Upfronts beginning in May, I am writing to inform you of a potential labor dispute that could have a significant impact on primetime programming for the 2017-2018 television season,” says a letter sent Tuesday to one media-buying firm by David J. Young, executive director of Writers Guild of America West, and reviewed by Variety. “As a stakeholder that may be negatively affected by this dispute, this information may be relevant to your media buying plans.”

The letter goes on to suggest that in the event of a strike, “a work stoppage will begin May 2nd” and ” could significantly affect the fall television season.” As a result,” late night shows including ‘Tonight Show Starring Jimmy Fallon’ ‘The Daily Show,’ “Jimmy Kimmel Live,’ ‘Saturday Night Live,’ ‘Full Frontal with Samantha Bee,’ ‘The Late Show with Stephen Colbert’ and others will go off the air. Some scripted series scheduled to air in the summer of 2017 may be affected as writing and producing for the season is ongoing.”

The WGA is about to conduct an authorization vote for a strike, part of an ongoing wrangle with the The Alliance of Motion Picture and Television Producers over compensation levels for writers as TV series shrink from the past’s 22-episode norm to shorter orders as a result of new economics in the TV business.  WGA has set April 19 as the start date for its strike authorization vote. The guild’s current master film and TV contract with the major studios expires May 1.

The letter is clearly meant to pressure the AMPTP by going to one of the main sources of  the industry’s revenue and profit. NBCUniversal alone tries to sell $6 billion of ad inventory during the upfront season, during which U.S. TV networks try to sell the bulk of their ad inventory for the coming programming cycle. In 2016, the nation’s five big English-language broadcast networks secured between $8.41 billion and $9.25 billion in advance ad commitments for primetime, according to Variety estimates – the first time in three years they’ve managed to break the $9 billion mark. Billions more are committed to other TV dayparts as well as cable and Spanish-language TV.

“Our objective continues to be to reach an agreement with the WGA at the bargaining table,” The AMPTP said in a statement. “We hope the Guild will engage with us on the issues in that forum when negotiations resume on Monday.”

In the letter, Young cites fallout from the WGA’s last strike, which took place starting in November, 2007, and lasted for 100 days. According to the letter, the work stoppage “resulted in the loss of almost 25% of primetime scripted programming for the 2007-2008 broadcast season,” leading to a greater reliance on reality programming and a drop in ratings.  Should a strike occur in 2017, we would expect that the delay or loss of original primetime programming will similarly affect ratings.”

Ad buyers are in the midst of holding early meetings with TV networks, hoping to get a sense of new programming and new advertising possibilities. In recent weeks, for example, Omnicom Media Group over a two-day period hosted ad-sales teams from companies including Discovery Communications and Time Warner’s Turner, according to executives familiar with the discussions.

Dave McNary contributed to this story