Originally Published: 13 JUL 23 03:47 ET

Updated: 13 JUL 23 06:08 ET

By Chris Isidore, CNN

New York (CNN) — A union representing about 160,000 Hollywood actors is poised to go on strike after talks with major studios and streaming services have failed.

It will be the first time its members have stopped work on movie and television productions since 1980, after a final day of negotiations on Wednesday did not produce an agreement.

Fran Drescher, president of SAG-AFTRA, the union, said in a statement the studio management’s offers were “insulting and disrespectful.”

“The companies have refused to meaningfully engage on some topics and on others completely stonewalled us,” she said. “Until they do negotiate in good faith, we cannot begin to reach a deal.”

The union said its negotiating committee had unanimously recommended a strike and that its governing board will vote on that recommendation later Thursday morning.

A news conference to announce the results of the vote and possibly the formal start of the strike is set for noon PDT at the union’s headquarters in Los Angeles.

The union’s rank-and-file members had already voted 98% in favor of authorizing a strike.

The body representing studios and streaming services said it was “deeply disappointed” in the decision to strike, saying it had offered “historic” pay increases.

“Rather than continuing to negotiate, SAG-AFTRA has put us on a course that will deepen the financial hardship for thousands who depend on the industry for their livelihoods,” said a statement from the Alliance of Motion Picture and Television Producers (AMPTP).

News of the upcoming strike action comes after a two-week extension of the union’s contract expired.

A federal mediator requested by management and approved by the union joined the final day of talks.

Joining the writers

SAG-AFTRA members will now join the more than 11,000 members of the Writers Guild of America, who have been on strike against the same studios since the start of May.

That strike had already halted production of most movies and scripted television programs. There has been no apparent progress in ending the action.

Now, there are concerns that with actors joining the writers on strike, the shutdowns could stretch through the summer and perhaps even persist through the end of the year.

The actors’ strike is expected to bring most of the remaining productions to a halt, with the exception of some independent films not associated with major studios.

Hollywood actors and writers haven’t been on strike at the same time since 1960, when former US President Ronald Reagan, then a performer, was the president of SAG, the precursor to SAG-AFTRA.

The industry has changed radically since the last actors’ strike against studios in 1980, when most television shows were on just three broadcast networks and movies were shown first in theaters.

“The studios and streamers have implemented massive unilateral changes in our industry’s business model, while at the same time insisting on keeping our contracts frozen in amber,” said Duncan Crabtree-Ireland, the union’s chief negotiator.

“Their refusal to meaningfully engage with our key proposals and the fundamental disrespect shown to our members is what has brought us to this point. The studios and streamers have underestimated our members’ resolve, as they are about to fully discover.”

The difficulty of coming up with contract language to cover the age of streaming services and artificial intelligence (AI) is why many people fear it will be difficult to reach agreement on a contract quickly.

“This is a sea-change negotiation,” said David Mumpower, chief content officer of Mickeyblog — which tracks news about Disney — and cohost of the “Streaming into the Void” podcast.

“And if they get it wrong now, they’re going to have it wrong for decades.”

Watching the bottom line

The strikes come at a time when the major media and tech companies that have jumped into the world of streaming services are focused on cost cutting and profitability, rather than subscriber growth.

The AMPTP is negotiating on behalf of the studios — including Amazon (AMZN), Apple (AAPL), CBS (VIAC), Disney (DIS), NBC Universal, Netflix (NFLX), Paramount Global, Sony (SNE) and CNN parent Warner Bros. Discovery.

Many of these companies have seen drops in their stock prices in the last year, prompting cost cuts that have included layoffs.

It had earlier seemed as if the actors’ strike could have been avoided.

Drescher recorded a video message to members saying the union was having “extremely productive negotiations” with AMPTP.

But immediately after her message, a letter signed by hundreds of high-profile performers — including Meryl Streep, Glenn Close, Jennifer Lawrence, Bob Odenkirk, Mark Ruffalo, Quinta Brunson and Rami Malek — urged the union to take a hard line.

The actors said they were prepared to go on strike for the contract that members needed.

“A strike brings incredible hardships to so many, and no one wants it,” the letter said.

“But we are prepared to strike if it comes to that. And we are concerned by the idea that SAG-AFTRA members may be ready to make sacrifices that leadership is not. We hope you’ve heard the message from us. This is an unprecedented inflection point in our industry, and what might be considered a good deal in any other years is simply not enough.”

More than 300 actors signed the letter initially. The signature count has since climbed to over 1,000, according to trade publication Deadline.

The issues in the actors’ strike included increased pay, as well as progress on residuals, particularly on streaming services.

There are also concerns about the emergence of AI.

“We all agree AI is going to be used. We don’t know yet how it will be used,” said Tom Nunan, a lecturer at the UCLA School of Theater, Film and Television.

The AMPTP said its proposal to the union included “a groundbreaking AI proposal that protects actors’ digital likenesses.”