Chapter 07
Hollywood stands at a fragile turning point. What might the next 12-18 months hold? Three scenarios — and the key indicators to watch.
The good news: The labor wars of 2023 are resolved. Content pipelines are slowly unclogging. California's beefed-up incentives plus labor stability have set the stage for a production rebound.
Many stalled projects have resumed. Some studios report a surge of scripts in development. Streaming growth has stabilized with more viable business models.
The challenges: Hollywood must confront a "new normal" of reduced volume — likely fewer total jobs and projects than 2019-2022. LA faces an uphill battle to reclaim production market share.
"We'll remain in uncharted territory. We have months to go before we can describe what the new normal looks like for filming in L.A."
— Paul Audley, FilmLA PresidentIf things break positively — no recession, breakout hits boost confidence, tax credits attract projects — Hollywood could have a mini-boom by late 2025.
A gradual recovery through 2025, but not a full return to pre-pandemic heights. Modest improvement, not a boom.
Risk factors could make things worse: recession, accelerated streaming fatigue, major studio financial distress.
Quarterly reports will be the primary measure. Is each quarter of 2025 showing improvement? Q1 2024 was dismal — Q1 2025 should see a jump. If not, that's worrying.
Earnings calls from Disney, Netflix, WBD — listen for commentary on content spend (resuming growth or still cutting?), profitability milestones, and consolidation hints.
A surprise breakout can lift the industry's spirits. Also watch if studios lengthen theatrical windows (theaters doing well) or shorten them (trouble).
Implementation of new contracts — any disputes on AI usage requiring arbitration? Any viewership bonuses paid (proof the system works)? By mid-2025, guilds start preparing for 2026 negotiations.
California EDD data on motion picture jobs. If they climb back near pre-strike numbers by late 2025, that's positive. If unions report many members still idle, that's a red flag.
Are studios announcing robust film slates for 2025/26? If slim pickings or more delays, contraction persists. Any talk of "re-expanding" output would be bullish.
Strike-delayed projects should be filming. First real test of whether rebound materializes.
Networks and streamers reveal 2025-26 slates. Upfront advertising season shows market confidence.
Loaded theatrical slate could push box office toward $10B. Holiday season tests audience engagement.
First projects under boosted California credits must start shooting. Key test of incentive effectiveness.
WGA (May) and SAG (June) contracts expire. Negotiations begin — will lessons of 2023 hold?
"Hollywood in late 2024/early 2025 is down but not out. It's an industry in retrenchment, finding its footing in a transformed landscape."
The likely outcome is something in-between — Hollywood recalibrated. Neither the apocalyptic "Hollywood is dying" scenario nor a return to the golden years.
Instead: a resilient, evolving Hollywood that still sets the tone for show business worldwide, albeit sharing the stage with more players than before.
Core strengths remain:
The coming year will be pivotal in determining whether LA can reassert itself as a thriving production hub or settles into a more modest role amid a dispersed global industry.
Key success factors:
What we know for certain: this new normal is forming now, one cautious step at a time.
Hollywood will endure and adapt — the world's appetite for content is not abating. But the industry that emerges will be leaner, more geographically dispersed, and more financially restrained than the free-spending Hollywood of the late 2010s.
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