Can Hollywood survive corona virus?

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as the Cova 19 pandemic continues to wreak havoc across the United States industries across all sectors are feeling the effects of an economic shutdown there’s no doubt that the issues around the coronavirus are having a significant impact the Dow index has now lost 3200 points this week alone it is now down nearly 10 percent this year one of its biggest victims is Hollywood the center of America’s entertainment industry the US government’s call for social distancing has forced all studios to shut down their TV and film production as well as postpone all of their theatrical releases resulting in hundreds of thousands of workers in the industry losing their jobs in the process I myself am on hold for a job in May very big Network job and I keep thinking it’s just not gonna happen we have seen a halt in production the past due to strikes and other things but this is quite different this is a halting production that no one could have anticipated no one saw coming really it couldn’t plan for it this is huge news considering Hollywood is one of the key players in the American economy a 101 billion dollar industry that supports two and a half million jobs and contributes to 181 billion dollars in total wages so the industry of creating visual entertainment is an industry that is spread out over a large area from the caterers the people that provide food for

the workers and for the large amounts of workers that create the shows all the way to the streamers and to the industry that is based around exhibiting the product that we create it’s one of America’s largest exports as one of the world’s oldest film industries Hollywood has had its fair share of experience with recessions but nothing quite like kovin 19 which poses an essential question can the movie industry survive the corona virus and if so what would it look like after the American market has always held a long-standing belief that movies are a recession proof industry and so if you think about why we would think of Hollywood as being recession proof it’s because what’s happening in a recession is what we think of in economic terms as substitution people will substitute from more expensive goods to cheaper goods so in entertainment terms you can substitute from a live show which is expensive to movie which is much cheaper it’s also because of how well Hollywood fared during the Great Depression movie attendance remained high at 60 to 80 million attendees per year people couldn’t afford bread yet they were going to the movie theaters almost around the clock but things have changed since then during the Great Recession of

2008 the industry took a major hit despite a relatively stable performance in the box office hiring rates in the art entertainment and recreation sector dropped by 16% with nearly 900,000 employees laid off or discharged in 2008 alone and companies that own major film studios like disney viacom and Time Warner nearly halved in share prices during its were strong but Cova 19 poses an entirely different challenge as recent measures for social distancing closed down theaters physically preventing people from going to the movies the challenge with kovat 19 is it’s unlike any recession we’ve ever had before we don’t know if people are gonna want to return the theaters we don’t know how how frequently they’re gonna want to go or if they’re gonna want to go at all for the first time in history studios are looking at near zero box-office revenue for the foreseeable future domestic box office for the third week of March brought in a mere 5,000 $179 a hundred percent decrease from the previous week it’s a devastating hit considering 42 percent of global theatrical and home mobile entertainment market still depends on theatrical releases people are willing to pay more to watch a movie in a theater than on any other platform and so if these films can’t be shown in theaters that is just gonna be economically disastrous for the studios and as the National Association of theater owners requested relief measures from the government and now what we need Congress to do is to step in and to help industries like ours that are completely shut down shares of theater chains like AMC and Cinemark plummeted over 50% certainly with the rise of streaming we’ve seen a decline of theatrical tickets and so the theater business has been on shaky ground before the virus and this will only amplify that the series of bad news from Hollywood and the unprecedented 6.6 million unemployment claims reported by the Labor Department have sent the entertainment sector spiraling media groups that own subsidiaries in movie production and distribution like Comcast Sony and

Viacom have sunk with the rest of the market the problem worsens once you look outside of the US theaters around the world are shutting down and that is bad news for the film industry that heavily benefits from international ticket sales studios are now looking at alternative release strategies on April 10th universals trolls world tour became its first film to release digitally and theatrically at the same time the determining factor on whether a film would be released on home video rather than in a theater is based a lot on the budget because again if you don’t have the theatrical dollars coming and mean the movie theater revenue it’d be really hard to make a lot of those bigger movies profitable most if not all of the big-budget summer blockbusters like MGM’s no time to die and Warner Brothers Wonder Woman 1984 have been postponed to a later date some films like universals fast 9 are even being delayed for an entire year whether it’ll be profitable is another question and that’s why these movies have to be theatrically released because that’s the only way is from those tickets sold in movie theaters that you can pay back first the production budget then pay for the marketing budget and then at that point eke out a profit however streaming is one part of the media in the street that is rapidly growing recent nielsen data shows that an average person spent 36% more minutes streaming during the week of March 16th as compared to the week of February 24th before the shutdown Netflix and YouTube are the two most popular choices it’s gonna accelerate the the introduction the adoption of streaming and our homes and then it’ll be interesting to see what the long-term effects are do do the theaters come back or do we all decide that you know what sing in my home watching this in the safety and comfort of my home is so much easier the pandemic is not only devastating to the big studios but the people who work in the industry as well Hollywood has long been known for its freelance economy that hires freelancers of various backgrounds and expertise we’re constantly hustling we hustle in order to work in this industry you hostile and and if you’re really lucky you get on a regular show that runs for a while and then it ends and then you’re that’s it right on the phone emailing but hundreds of thousands of them have lost their jobs overnight as productions are postponed or canceled due to the virus I had quite a few things lined up to shoot and all of a sudden one right after another the phone started ringing and I was watching the news so I knew inevitably that was what was coming and boy just like dominoes one right after another everything many of these workers live paycheck to paycheck and rely on overtime or secondary jobs to stay afloat a bigger issue lies in the fact that many of them don’t qualify for traditional unemployment benefits due to their employment status and the nature of their job the gig economy is a very fragile economy and I think this virus is exposing that fragility I think a lot of our problems economically extend beyond before this virus are being revealed now and part of that is the fact that we have a large amount of people who are self-employed the Writers Guild of America strike in 2007 might give a glimpse into how devastating the situation could turn out to be the strike forced many major productions to shut down over 100 days costing 37,000 700 jobs and 2.1 billion dollars in just three months this whole situation just caused so much angst and stress for people in the industry and again for all industries and I don’t know we couldn’t have seen this coming but I guess it is somewhat analogous to a like a writer’s strike or something like that but that’s totally different because that was something planned and this is something completely unimaginable even six months ago a few companies have stepped in to provide relief for the industry the streaming service Netflix are now setting up a 100 million dollar Relief Fund for its out-of-work production crews and cast members thank God our union is also continuing they fought to continue our health care for the next six to nine months so that normally we have to qualify with certain amount of our verse but they’re kind of they’re waiving that right now so that’s no one

will get kicked off medical which is great but most hope lies on the unprecedented two billion dollar stimulus bill signed into law on March 27th although the stimulus package does not directly address Hollywood as it did with medical and airline industries it provides some measures for studios and freelancers to stay afloat the new bill allows for more freelancers and part-time workers to be eligible to apply for unemployment benefits with an additional $600 per week for four months compared to other beneficiaries bigger studios can take advantage of the 500 billion dollar lending program while smaller businesses with less than 500 employees can rely on a 350 billion dollar lending program as long as they do not lay off its workers as to how much it will help the industry is somewhat of a mixed bag nobody thinks that this $1200 is going to solve the biggest problems of the cash flow of being stopped from our employers especially if we’re talking about an extended period of time anytime you are injecting two trillion dollars into the economy that is far better than not injecting two trillion dollars into the economy so the stimulus bill will have a positive impact on the entertainment business it might just happen in the long run but maybe not in the short run I think it’s great for right now but how long is that $1,200 musta last not in LA that’s that doesn’t last very long at all but no matter how bleak and uncertain the future might be one thing is for certain people will always want some sort of entertainment entertainment for so many of us is the the thing that keeps us going and gives us that escape from these troubles that are happening right now in our world

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