Although advances in digital technology may be the most noticeable change in the television and film industries, the shift from talent agencies to talent management companies may be one of the most important. For decades, talent agencies held sway over the entertainment industry. But changing times have created the rise of companies designed to manage talent in a different way. While there are still changes to be made, particularly with the Labor Commission, it seems that talent agencies may be fading away shortly.
The Fall of Talent Agencies
Until recently, talent agencies held remarkable power over film and television productions. Their ability to create package deals and earning commissions from the salaries of actors meant that they garnered considerable power and income for many decades.
However, three events that happened almost simultaneously have changed dramatically the landscape for talent agencies.
- Writer’s Guild of America (WGA): Disrupting the packaging process
- COVID-19: Shutting down production and stopping commissions for the time
- AB5: A new California law changing how freelancing works
AB5 had the indirect effect of shutting down independent productions outside the Hollywood system. This meant that small film companies could not hire independent contractors which have essentially shut down the indie film industry in the state.
The heart of the matter for many who deal with talent agencies is that they take 100% of the money owed to the talent and then remove 25% for their fees and the talent management before sending the rest to the actor. This “off the top” approach has many asking the question of why talent agencies are taking 10% and temporary control of the money when they didn’t do anything?
Rise of Talent Management
Instead of talent agencies which solicit work for their clients, talent management companies provide advice for career opportunities. Because of the California Talent Agencies Act, such agencies must register and post a bond with the state before they can solicit employment for their clients. Talent management companies do not engage in that pursuit.
An important issue faced by talent management companies is the solicitation of studios, networks, and production companies for their services. While established agents should have little difficulty submitting projects with networks and studios that have a pre-existing relationship, new managers will have a more difficult time.
Given the fragility of the entertainment industry in California, the state’s labor commission needs to make some important decisions before they lose everything.
Until they take action to change the very laws of the state that stopping production from happening, talent managers will either be represented by law firms in the entertainment industry. Or, management companies will have to represent themselves as talent agencies in name only to get around the current requirements.
However, the latter solution runs afoul of the current agreement between the WGA and talent agencies in terms of packaging. Any permanent solution must be founded in the law which currently the California Labor Commission oversees. Until such changes are made, it may take a long time for the entertainment industry in California to fully recover, if at all.