Image: "Reno 911" actors
Damian Dovarganes  /  AP
"Reno 911" actors create a "crime scene" at the headquarters of the group representing producers in Encino, Calif., on Tuesday to show support for the writers.
updated 12/18/2007 7:18:52 PM ET 2007-12-19T00:18:52

With "American Idol" and Jay Leno back on the air in January, it may seem that all is right with television. But the industry is facing its worst labor crisis in two decades, a crippling writers strike that's reshaping the business of TV and threatening to permanently shift the viewing habits of millions of Americans.

Now in its seventh week, the Writers Guild of America walkout has forced producers to reconsider how shows are developed, the type of shows produced and how they're sold to advertisers.

On the audience side of the equation, a flood of strike-induced reality series and truncated dramas may drive viewers toward alternate entertainment — including Internet programming, which is at the heart of the contract dispute.

The walkout has halted production of most scripted and late-night shows, although Leno and Conan O'Brien are coming back to work next month on NBC, as is ABC's Jimmy Kimmel. CBS' David Letterman was considered likely to follow suit.

(Msnbc.com is a joint venture of Microsoft and NBC Universal.)

Talk of industry change is dismissed by some writers as spin designed to undermine union resolve on payment for streamed and downloaded distribution. But networks contend the strike has given a new urgency to the need to confront ballooning costs and an evolving marketplace.

"The strike is forcing us to look at the way we all do business and to make choices that were tough when business was as usual," said NBC Universal Chief Executive Jeff Zucker. "This is allowing us to make the tougher choices."

With negotiations at a standstill, the impact is extending to the 2008-09 season, beginning with the typical first-quarter "pilot season" in which networks commission single episodes of potential series.

It's an unwieldy process that may have had its day, said two executives at a major network, speaking on condition of anonymity because their company had yet to officially detail its plans.

Pilots are more expensive than ever to produce, reaching $6 million or more for complex action dramas, but don't necessarily represent the series that are delivered, the executives said. This year's results were unimpressive, with a number of anticipated new series — ranging from NBC's "Bionic Woman" to ABC's "Cavemen" — failing to get ratings traction.

Instead, networks are considering taking pitches straight to series, especially when a show comes from road-tested producers. A prolonged strike would force the issue, pushing broadcasters up against the fall season production deadline.

Guild member Warren Leight, executive producer of "Law & Order: Criminal Intent," contends the rumored death of pilots is greatly exaggerated. "People have grumbled every year for the last 20 years that pilot season is too expensive," Leight said.

Another entrenched custom involves May events in New York at which networks, with elaborate, multimillion-dollar fanfare, unveil their fall schedules for Madison Avenue and collect billions of dollars in advertising commitments.

"There has been no final decision, but it is increasingly unlikely that we will do a traditional upfront presentation this year," CBS spokesman Chris Ender said. "We've been talking about it for years; this may be the opportunity to work with our clients to reinvent the process in a way that better serves networks and advertisers."

NBC is reconsidering the scope of its presentation, Zucker said, but added, "I don't think the selling period will change" because of its efficiency.

For audiences, the central issue is loyalty amid disorder.

Because of the strike, "Lost" may only be able to air half the episodes of the 16 that were planned when it returns in January. "Desperate Housewives" won't reveal the second part of a tornado cliffhanger until after the drama resumes production.

A few new scripted shows are poised to help fill the gap, and other options are emerging, some innovative. NBC said this week it will air "quarterlife," an Internet series from the producers of "thirtysomething," with short "webisodes" combined into hourlong episodes.

At least one network is taking a look at imported programming, mulling how receptive U.S. viewers would be to shows lacking an American accent.

But upcoming broadcast schedules largely will be stuffed with reality shows — and not just blockbusters like Fox's "American Idol," or ABC's "Dancing with the Stars," which returns in March.

If the genre doesn't burn itself out, the programming balance could remain tilted toward reality even after the strike is settled.

Will viewers warm to "Dance Wars: Bruno vs. Carrie Ann," ABC's "Dancing" spinoff, or NBC's "American Gladiators" with Hulk Hogan — or just shrug and look beyond TV for fun?

Dozens of established writers are trying to take entertainment directly to consumers on the Internet and negotiating with venture capitalists for startup funding.

In a recent consumer survey, half of those polled said that they have or will seek more online entertainment because of the strike, according to Kelton Research and the Wi-Fi Alliance, which tests and certifies wireless products.

On average, those questioned said they already get nearly a third of their entertainment online, according to the poll, which had a margin of error of plus or minus 4.1 percentage points.

While that suggests a dangerous drain for TV, especially for broadcast networks long subjected to cable's theft of viewers, one analyst cautioned that such a view ignores the corporate context.

In the last protracted Hollywood strike, the 1988 walkout by the writers guild, networks saw viewers migrate to cable and stay there. This time around, broadcasters may be losing audience share to a sister company, not a competitor.

The Walt Disney Co., for instance, owns ABC as well as cable channels including ABC Family and Disney Channel, while General Electric-owned NBC's corporate family has CNBC and MSNBC. Media conglomerates also are staking out Internet turf: MySpace is a unit of News Corp., which owns Fox TV and, among other cable channels, Fox News Channel and Fox Sports Net.

Media companies "are managing a different business than they did" in the '80s, a multichannel and multimarket one, said David W. Rips, director of the media and entertainment practice at Deloitte Consulting.

Whatever the financial intricacies, consumers will make their way through them.

Chris Becker, 43, of Newport Beach, has a strike strategy in place: DVD rentals of dozens of movies he's been wanting to watch and season compilations of new network series.

"I try to be selective, but now's the opportunity to catch up," Becker said. "I'll probably see shows I hadn't seen before."

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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