Six weeks after the Hollywood writers strike ended, Warner Bros Discovery CEO David Zaslav has said the union was right and expressed no regrets “overpaying” for the new three-year contract.
“They are right about almost everything,” Zaslav told The New York Times in ‘How David Zaslav Blew Up Hollywood’ a far-reaching interview published on Wednesday. “So what if overpaying? I’ve never regretted overpaying for great talent or a great asset.”
The Writers Guild of America (WGA) contract is estimated to cost the studios and streamers $700m a year after the union and Alliance of Motion Pictures and Television Producers reached a tentative deal on September 24 before union members ratified the deal on October 9.
Zaslav’s comment about overpaying will raise eyebrows in Hollywood in light of his $246.6m compensation in 2021, months before the Discovery-WarnerMedia merger was finalised.
The acquisition brought with it a $56bn debt load, which Zaslav and his CFO Gunnar Wiedenfels have addressed this year with a previously reported revised target of $4bn in cuts including job losses.
The SAG-AFTRA strike ended on November 9 and the union has said its tentative three-year deal is expected to cost the studios and streamers around $1bn over the contract term. The deal is currently before the union’s 160,000-strong membership in a ratification vote timed to end on December 5.
Wiedenfels told The New York Times that WBD expects to generate in the region of $1bn in free cash flow from the Hollywood work stoppages.
That comes from savings on production and related costs during the long production pause which began on May 2 when the writers went on strike and turned into a total shutdown on all filming involving SAG-AFTRA members on projects under the jurisdiction of the actors union as soon as it went on strike on July 14.
As part of cost-saving, Zaslav and Wiedenfels have shelved films for corporate tax write-offs. After adopting the tactic for Batgirl and Scoob! Holiday Haunt will be released in 2022. Executives have just reverted the course of the live-action/animation hybrid Coyote Vs. Acme by Looney Tunes. They’ve been screening it this week to streamers.
