LA SCREENINGS: The unprecedented crisis shaking Hollywood has left the independent sector hanging by a thread – but is also pushing many studios and producers to rethink their strategies and mindset.

It would have taken a bold screenwriter to imagine that, after an unrelenting series of events – a global pandemic, writers and actors’ strikes, the post–Peak TV contraction and wildfires – an unpredictable president would pile on by imposing sky-high tariffs across half the world, including a 100% tax on films made outside the US. Even though, as of press time, no one really knows what that really means.

Today, Hollywood finds itself further than ever from its golden age as the global capital of film and television. Studio occupancy has dropped dramatically (63% in 2024, compared with over 90% between 2016 and 2022) and employment is down 25% from pre-pandemic levels, according to data from Los Angeles’ film office, FilmLA.

The reasons are many, but they lead to a common outcome: it has become disproportionately expensive to shoot in the City of Dreams. Meanwhile, other US states like Georgia and countries such as Canada, Spain and the UK are offering increasingly attractive incentives.

“It’s cheaper to fly more than 100 Americans to Ireland than to walk across the Fox lot, past the sound stages, and do it there,” actor and host Rob Lowe said on his podcast Literally! With Rob Lowe, referring to The Floor, a gameshow that Fox filmed at a production hub in Ireland.

Producers of CBS series Raid the Cage, filmed in Mexico, or HBO’s House of the Dragon, shot across the UK, Spain and Portugal, could say the same.

“There are no tax credits [in the US], while all those other places are offering 40% and then on top of that there’s other stuff that they do,” Lowe added. “And that’s not even talking about the union stuff. That’s just the tax economics of it all. It’s criminal what California and LA have allowed to happen. It’s criminal. Everybody should be fired.”

His clip went viral and caused quite a stir in Los Angeles. By the end of April, over 100,000 letters had been sent to Sacramento urging lawmakers to approve two complementary bills aimed at modernising California’s Film & Television Tax Credit Program by raising the annual incentives cap from US$350m to US$750m.

While those legislative efforts play out, the independent sector is trying to recover from the seismic shock. And those lucky enough not to be driving Ubers or working at Trader Joe’s are leading a wave of rebellion and reinvention, implementing changes to prepare for a future that will play by very different rules.

So what are these changes? And could they apply to companies and markets facing similarly tough challenges? The first major takeaway: now more than ever, you can’t put all your eggs in one basket.

CBS series Raid the Cage was filmed in Mexico

“It’s been a traumatic experience for the whole industry,” says Nando Vila, head of studio at Exile Content Studio in Los Angeles. “It’s become clear that you can’t just rely on selling TV projects. As a producer, you have to diversify. The market changes fast, and if you don’t constantly adapt, you’ll die.”

That diversification covers not just genres and content types, but also geography – a necessity made even more urgent by the unpredictable impact of protectionist measures taken by the Trump administration.

“For producers with an international outlook, there are real opportunities,” says Vila, whose company primarily produces in Latin America and Spain. “The international coproduction model will only grow. These projects are more financially efficient and open up creative pathways that the traditional model doesn’t offer.”

But perhaps the most essential form of diversification comes even earlier. Hollywood’s crisis coincides with a broader reckoning in the global television business which is finally starting to realise it can no longer look down on the creator economy. On the contrary, it needs to embrace it – and fast.

Producer Benjamin Odell, co-founder of LA-based 3Pas Studios with Mexican star Eugenio Derbez, believes the smart play lies in the “white space” between declining premium production and booming digital creators. As he tells C21’s sister publication Cveintiuno, traditional producers are not doomed – but they do need to evolve.

“To find that white space where you can create premium content while still being on YouTube or whatever platform your audience is on, you need to be willing to change. And we’re not talking a 90-degree turn, it’s a 180 – a whole new direction, with new models and new people,” says Odell, who also writes Open Gardens, a Substack on this topic.

What companies succeeding in this space show is that a major shift begins with adopting a creator mindset. Quality and craftsmanship are essential but no longer sufficient. As a company, you need to know your voice, what makes you unique and memorable, and who your audience is. From there, you build a community around your content.

But for most traditional Hollywood producers, and others globally, the idea of pivoting from pitching commissioners to building a YouTube channel is terrifying, or at the very least, overwhelming. And yet, that might be the key: rediscovering the beginner’s mindset, the curiosity and boldness you had when you started out.

Some are even offering a concrete path forward. Sam Barcroft, media entrepreneur and founder of the consultancy Creatorville, sparked debate recently with a viral LinkedIn post declaring the death of the TV commissioning model. “TV commissioning is dead. Broadcasters aren’t filling schedules anymore – they’re building platforms, which means they don’t want pitches. They’re buying stuff that’s already working – hits, formats with traction, shows with numbers behind them,” he wrote.

His solution? “The smart move now? Launch it yourself. Use social to test, learn and grow. Show there’s an audience. Pilot your show on TikTok. Prove it on YouTube. Then, sell it to the streamers. Forget broadcast commissions. Start building scalable franchises.”

Odell agrees: “Right now we produce 10 episodes of a series, invest millions and only afterward do we start looking for an audience, one we’re not even sure exists. Then maybe we make changes for season two.”

That model is worlds away from the digital paradigm, where feedback loops take hours, not months, and creators engage in real time with fans about what content they want.

But who funds those experiments? Advocates for this new path argue that you must forget massive investments. The idea is to produce with modest budgets, test, fail, learn and try again, and to trust that everything that made you good in legacy media still applies here.

Although streamers and commissioners express “a lot of interest and curiosity” in these conversations, producers say that corporate structures and budgeting practices make them slow to adapt. “Platforms themselves should be testing more,” says Odell. “Like networks used to do — make pilots, air them with ads, see if people liked them. We need to modernise the production model to embrace trial and error.”

Because if that test works, you’ll be living by another creator rule: they’ll come to you. And the TV exec won’t be the one calling the shots – or setting the price.

“The fundamental problem in the film and TV industry isn’t demand,” says Exile’s Vila. “It’s a supply and business model problem. Sure, it’s more competitive today, but young people still love shows and movies. The demand is there.”

Odell once heard something that stayed with him: “If you think back to the best things you’ve ever done in life, the ones that made you happiest, I bet you had to overcome massive obstacles to get there. So why are you avoiding the obstacles now?