Last Friday, US TV network ABC Studios terminated more than 20 writer or producer deals, invoking the force majeure provision allowing termination of such deals six weeks into a strike.

LastMonday, four other TV studios followed suit, saving tens of millions of dollars in the process.

On February 24, ABC stands to make some $80m from advertising revenues from the 80th Academy Awards broadcast. It is the second biggest advertising night of the year after the Superbowl in the US TV calendar and last year drew 40 million viewers and earnings to ABC of $1.7m for a 30-second slot.

If the writers' strike continues as rancorously as it has this week, the Writers Guild of America (WGA) will inevitably target the Oscars, for which it has already denied any writer participation.

In doing so, the WGA would strike a spectacular blow against one of the big three networks.

The WGA policy of targeting awards shows has already reaped results in the bitter war between the two sides. WGA's arch enemy NBC was deprived of around $20m worth of advertising when the guild crushed the Golden Globe Awards telecast on Sunday by enlisting its 'sister' guild, the Screen Actors Guild (SAG) to boycott the event.

But as the damage to the industry becomes increasingly severe - from the dire straits being encountered by below-the-line talent to the collateral effects on service companies affiliated to entertainment - support for the WGA is becoming strained.

The effective cancellation of the Globes, for example, meant that actors and writers missed their golden moment of celebration, and that specialised films such as There Will Be Blood and The Diving Bell And The Butterfly were deprived of their chance at nationwide publicity.

'The strike has had a terrible impact on awards season,' says Los Angeles publicist Ronni Chasen.

'It's created a really depressing situation for the Golden Globes and everything around it. It has created a tremendous loss of business for everyone who supports the Globes. But most of all it helps disrupt the celebration of movies. It's just too bad.'

But if the Hollywood Foreign Press Association (Hfpa), which hands out the Globes, was the WGA's first victim, many in Hollywood are starting to ask whether WGA will carry out its threats and take on the Academy of Motion Picture Arts and Sciences (Ampas), whose members represent the biggest creative players in town.

Hollywood stalwart Richard D Zanuck, who won the Globe for best picture (musical or comedy) for Sweeney Todd: The Demon Barber Of Fleet Street, said earlier this week: 'The Oscars is such a traditional highpoint in the life of the industry that I think something and someone will step up and solve this so the Oscars don't share the same fate as the Globes.'

Just who that 'someone' will be is still unknown. Rumours abound that Hollywood titans such as Tom Hanks, himself on the Ampas board, and George Clooney are considering stepping in to help negotiations resume.

Meanwhile the Directors Guild of America (DGA) last week reached agreement in its own contract renegotiations with the Alliance of Motion Picture and Television Producers (Amptp), perhaps confirming the view that it is a much more rational organisation than the WGA.

But as yet theWGA has not fallen into line and the perplexed speculation that the Oscars will be called off continues.

The WGA might lose any remaining support in Hollywood if it carries out its plans.

'The writers are going to lose public support if they veto the biggest celebration on the movie calendar,' says one marketing executive. 'I think the strike will be over by (the Oscars), and if not I think the Academy will get a waiver.'

'It would be a shame for everyone in this industry (if it didn't happen),' says Samuel Goldwyn Jr, who has produced the Oscar telecast on two previous occasions. 'This isn't about studio bosses getting recognition. It's about members of the various guilds getting recognition. To deny them that would be really sad. Nobody gives an award to Fox. They don't give it to the studio boss, or Rupert Murdoch. They give awards to an actor, a writer, a cameraman. To deny them their moment in the sun would be extremely sad. This also affects WGA members. One or two writers might be denied a spot in the sun they might never have again.'

Indeed, many are starting to question the WGA strategy which has been engineered by David Young, who in the 1990s served as national director of organising for the Union of Needle Trades, Industrial and Textile Employees (Unite). While the Globes were axed, the SAG Awards - broadcast on Time Warner-owned cable channel TNT - and the Independent Spirit Awards were granted waivers.

Similarly when Globes producer Dick Clark Productions (DCP) went to the WGA with the same terms for an interim agreement as had been granted to David Letterman's company Worldwide Pants, it was denied.

Not only is there inconsistency in the policy but Young and company might be misjudging the way Hollywood works. He is 'an organiser for the plumbers, and someone from outside the industry who doesn't know the scene', offers one executive.

'This was just so badly handled,' he adds. 'If you went back and asked the WGA if they would do it this way again, the answer would be, 'No'.'

But as Goldwyn Jr explains, the issues at stake in this strike are not so much related to films, which is the shame of losing awards shows that celebrate them.

'We're talking about two very different industries,' he continues. 'Movies no longer have to be a mass-produced institution, but television still is. TV has to do so many hours of entertainment. Movies do not. If anything the studios are producing too many movies, and they know it. The studios are coming to an era when less, but better, is more.'

Whether or not this year's battle in Hollywood spurs a sea change in the way the studios do business, the Academy is remaining resolute. As its chief communications officer Leslie Unger asserts: 'We're continuing with plans to present our show come February 24.'

But what form that will take is anyone's guess.

Topics