Home Hollywood “Cut!” Hollywood looks for savings as costs rise.

“Cut!” Hollywood looks for savings as costs rise.


The nominations for the 74th Emmy Awards were revealed on Tuesday, and while one might focus on the nominees or analyze who might be the winner, TV company and studio executives struggled behind the glitz and glamour. Both performing arts divisions are dealing with rising production costs, delays in equipment and parts deliveries, and uncertainty about material availability. It’s all affecting the way they do business.

To learn more, Marketplace host Kai Ryssdal spoke with The Hollywood Reporter’s business and legal reporter Winston Cho, who writes about Hollywood’s fight against inflation. Below is an edited transcript of their conversation.

Kerris Dahl: So at the beginning of this article, you said “the entertainment industry collapsed under the weight of inflation”. What does this mean for the entertainment industry?

Winston Cho: So inflation and supply chain disruptions have gotten to the point where production has to start choosing where they want to start cutting. A brick-and-mortar production executive told me that one decision he had to make was that a scene could be seven-eighths of a page. Is that scene really necessary? Can we combine it with another scene? Now, that’s a saving of $500,000 — obviously a lot of money for these productions. This is where we usually see these cuts. I should say that some of these major studios haven’t made these cuts yet.

Risdal: Yes, that’s a very good point, actually. Because if you’re Studio X, and you’re going to shave $500,000 off the production budget, but Studio Y is like, “Yeah, you can have whatever you want,” and guess where this A-lister goes.

Give: to a larger studio. Yes.

Risdal: Yes. Still, something amazing is going on there. There are some stories in this post about a production designer or production supervisor, like, not looting, but picking in an old abandoned building that is about to be demolished so he can get things like lumber and insulation and this. everything.

Give: Yes, that’s a very interesting story. The foreman in the construction shop on the set told me that he had actually heard of an office building that was about to be demolished. Now, an idea flashed through his mind that they could actually raid office buildings looking for parts that would be demolished anyway. The main thing they were after was insulation, and both the manufacturer and the building shop were facing huge lead times, so he searched the office building for insulation, you know, other parts of the building like light fixtures, spare parts and stuff like that . And, you know, all he spends is the labor of tearing down the building, basically. So you know, it’s a huge win for him.

Risdal: Yes, we should be clear, we’re not talking about hard stuff, right? We’re talking about lighting cables and plywood and those things used to build the actual physical scene.

Give: Specifically, the parts, components, and supplies needed to actually build the physical set. I’m not talking about wood, or, you know, metal, or, you know, fabric or anything.

Risdal: It seems to me that entertainment, TV shows and movies, in some ways, are particularly incapable of responding to changes in inflationary costs, right? Because, you know, a regular store retailer can pass those costs on to the consumer, and the consumer, in general, kind of has to pay him or buy something else. It’s not like studios can pass the cost on to moviegoers or people sitting on the couch streaming Netflix.

Give: Yeah, I mean, I guess they could raise the price of the subscription service, but that’s, you know, they’re obviously remiss. I mean, the business is so big right now, it’s so thriving that it’s probably worth it now for the set build shop, for the studio, to invest in, expand the building, build the soundstage space. You know, the producers, the producers want this space, they need this space, and, you know, the stage operators out there, they want to be able to provide that space.

Risdal: It’s important to point out a lot of these studios and production companies here, and I mean, you know, nobody shed any tears for them. They do a great job. profit.

Give: I mean, Disney put in about $33 billion this year, Warner Bros. put in $23 billion, and Netflix put in about $17 billion in its content budget. I mean, you know, some of these companies are going through tough years, but they want to publish content. They need to get the content out.

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