The actors' union will strike alongside film and TV writers, and it could be a nightmare scenario for Hollywood: 'There's going to be no cash flow'

• For the first time since 1960, Hollywood actors and writers are on strike at the same time.
• Both unions striking could force a quick resolution with the Hollywood studios.

For the first time in 63 years, Hollywood is facing two simultaneous guild strikes. Writers walked out 10 weeks ago, and actors hit their own (already extended) deadline on July 12 to negotiate a new contract with studios.

SAG-AFTRA, the actors' union, announced Thursday that it would be going on strike at midnight Friday. Fran Drescher, the union's president, made an impassioned declaration of solidarity not just with Hollywood writers but with labor everywhere.

To the Alliance of Motion Picture and Television Producers, the organization representing the Hollywood studios and streamers, she said, "The jig is up." She and Duncan Crabtree-Ireland, the union's executive director and chief negotiator, said their membership is ready to bring the pain to the entertainment conglomerates, which have profited off of Hollywood's new business model while squeezing the artists and craftspeople who drive it.

The Writers Guild of America action has largely shut down most film and TV production. When the actors hit the picket lines Friday, it will cause an even deeper disruption to the entertainment industry.

"Everybody's really nervous because there's going to be no cash flow — they won't be making anything," a top talent agent said.

Some observers see a combined strike hastening an end to the impasse, while other see it extending the industry's paralysis.

A quick recap: The WGA and SAG-AFTRA have been unable to reach new deals over wages, the use of artificial intelligence, and other issues with the AMPTP — which represents more than 350 studios, networks, and streamers, including Netflix, Disney, and Amazon.

The WGA has been on strike since early May. Like WGA members before them, SAG-AFTRA members voted June 5 overwhelmingly to authorize a strike.

Stakes were high enough with the writers' strike. The last time they walked out, in 2007-2008, the work stoppage lasted 100 days, causing more than 60 TV shows to shut down and ratings and ad sales to drop. It cost the state of California over $2 billion and over 37,700 jobs.

With actors joining the fight, the logistics and optics of the movement change drastically. But the industry landscape, issues, and labor environment are vastly different now than in the mid-aughts. Here are two ways a broader work stoppage could play out, based on conversations with a handful of industry insiders.

The nightmare scenario

Jonathan Handel, an entertainment lawyer who previously worked for the WGA, told Insider ahead of the actors' official announcement that he believes the industry is in for a long slog — if only because of how complex and existential the issues are.

It's hard to overstate the magnitude of change that's swept Hollywood since 2008, as Handel sees it. The rise of streaming has upended the way writers and actors are paid. Generative AI, with its potential to write entire scripts and recreate actors, has erupted. The media conglomerates for their part are drowning in debt and struggling to make up for traditional TV declines with streaming dollars.

"There is so much at stake," Handel told Insider. "I don't think that filmed entertainment has seen a more rapid change in such a short period of time than since the end of World War II."

The labor environment broadly has changed, too. The movement is having a moment, as has been evidenced by other unions — from teachers to truck drivers — joining Hollywood writers on the picket line. That kind of moral support will be key to helping the writers and actors stay out longer.

What's more, on the AMPTP side, the major members include legacy studios, pure-play streamers, and tech companies that aren't all on the same page, which could get in the way of their ability to move as a unit to end a strike.

While companies like NBCUniversal and Disney still depend on a fresh fall network TV season — which is already under threat — to draw viewers and satisfy advertisers, Netflix would "probably be happy to see fall TV collapse," Handel said.

The 2007-8 writers' strike ended after the Directors Guild of America struck its own deal with the AMPTP, providing the framework for a WGA deal. As winter melted into spring, a looming Oscars telecast also provided an incentive to resolve things.

The directors in June came to their own new three-year agreement with the AMPTP, but there are outstanding issues that are unique to writers and actors. Staffing of writers rooms is a key concern for the WGA, while SAG-AFTRA members are more focused on AI, observers say. The Oscars telecast (which has lost a lot of its audience in recent years anyway) is months away, and there's talk of postponing the Emmys — typically broadcast in September — to November or later.

A combined writers' and actors' strike "could well go into the end of the year," Handel said.

The dream scenario

On the other hand, it's also likely the two guilds' contracts will be negotiated simultaneously — and there will be some efficiencies where there are shared concerns.

The media companies that rely on fall TV ad sales could bring the rest of the AMPTP membership along with them to get the strike resolved.

And having high-profile actors on picket lines, along with the good vibes unions are enjoying these days, will generate buzz and positive PR for the strikers — which in turn will incentivize the media companies to wrap things up, said Paul Hardart, director of the Entertainment, Media and Technology Program at NYU's Stern School of Business.

Disney CEO Bob Iger, together with Peter Chernin — then News Corp. president and chairman and CEO of Fox — helped break the stalemate to end the strike in 2008. So far, industry stakeholders told Insider, Iger has stayed on the sidelines this time around, but there's a hope he could swoop in once again.

Iger wasn't among the Hollywood heavy hitters, including Disney Entertainment co-chairs Alan Bergman and Dana Walden, who joined a call Monday to discuss the idea of federal mediation, according to reports. "I've had conversations that lead me to believe he'd not been involved," Handel said.

"I do think SAG going on strike expedites things," Hardart said. "I think you'll see pressure from external forces — whether it's the governor of California, the president of the United States — moving this along."

But like most people venturing opinions about Hollywood's simmering hot labor summer, Hardart concluded with a caveat: "I could be completely wrong."

"At some point, even the streamers run out of content and the companies just have to make a deal," Handel said. "The industry just can't continue struck."