Hollywood Breathes a Small Sigh of Relief

As of writing this the ticker on the AMPTP (Alliance of Motion Picture and Television Producers) tells us that the Writers’ Strike has cost them well over $220 million. But a ray of sunshine may just have spilt from the heavens over the strike with a new deal made between the AMPTP and the Directors Guild of America (DGA).

"I've read the bullet points, and it is a step in the right direction, it shows that agreement is possible, and it brings a spirit of hope that hopefully will extend to the WGA and the AMPTP," said director Oliver Stone. "If it is not taken in that spirit, that would be most unfortunate."

This new deal addresses much of what the writers are battling, but it was done in a way that was always going to endear the directors to the AMPTP. Internal and informal discussions between the DGA and AMPTP preceded the official talks which began on the 12th of January (and concluded on Thursday). In addition, nearly two years of preparation and research by the DGA only enforced the view that they wanted a good and fair deal.

“Two words describe this agreement - groundbreaking and substantial,” said Gil Cates, chair of the DGA's Negotiations Committee, in announcing the terms of the new agreement. “The gains in this contract for directors and their teams are extraordinary – and there are no rollbacks of any kind.”

The deal is a good deal for the directors, and focuses plenty on the hot issue of these strikes; internet media (new media). But we’ll get to just what the directors got out of it soon, first, the writers.

While everyone was pouring over the details of the deal (myself included), through the back of our minds runs one simple question; “What about the writers?”

The writers are now left without at least one ally (the theory was that the WGA, DGA and SGA would join when the latter two’s contracts came to an end in the summer) in their war against the studios. In addition, it looks as if the actors are backing the DGA deal, and hoping that the WGA will follow suit.

"I'm very pleased with the new agreement and I hope it helps speed up the negotiations with the WGA," said George Clooney in a statement.

The Writers

For the writers though, they are creating the product, rather than just instructing it in what to do. One producer believes that the writers will still have primary concerns, despite the DGA deal. That problem is going to be authorship. "This wasn't important to directors because they don't create characters that will be used in a zillion ways unless the writers get some protection," the producer said.

Authorship is what has kept the studios from making the touchups in production, and kept the writers on the picket lines. Without authorship, ownership, the writers are working for chump change and lose any control and residual power over what they create. This has been the primary concern, especially when it comes to the internet.

The televisions studios have been propagating their shows across the internet via streaming and via download services like iTunes and Amazon Unbox. However the writers haven’t been receiving any percentage of the cut of sales.

The studios say this is because the internet is nothing more than a promotional tool. But the writers – and many industry pundits – know that in the future the internet will be the main source of media. If the writers do not take action now against this, then they are going to have to fight a much tougher battle down the road when the internet reaches its full potential in media distribution.

One writer, who is part of a moderate faction of screenwriters and show-runners, believes that this DGA deal will be enough to settle a deal for the writers. "I think this will be enough to get the deal done," said the writer. "Even on the most aggressive invitation-only writer discussion sites, about 50% of people think this is enough. Many of us feel that this is the deal to make and if we don't embrace it, it's over because people will go fi-core, immediately."

The Deal

The highlights of the deal are just what you would expect to see in a deal created at the beginning of the 21st century. And the comments from both the DGA and the AMPTP reverberate the same theme; that this was a tough deal, but one that is groundbreaking.

“Of the 307 labor agreements the AMPTP has negotiated since 1982, this new DGA-AMPTP pact surely dealt with some of the most challenging issues we’ve ever faced,” said AMPTP President Nick Counter in a statement on the AMPTP’s website. “The formal negotiations that led to this agreement were preceded by weeks of tough and candid informal discussions. In the end, though, both parties were determined to focus on the core issues that are most important to all of us, and the result is an agreement that breaks important new ground for our entire industry.”

The three year contract struck between the two is definitely a boon for the Directors, and at least an indicator of what the Hollywood studios are willing to do. Wages increase for everyone by 3.5% each year of the contact except for directors of network prime time dramatic programs and daytime serials whose salaries increase only by 3%. Residuals increase by 3.5% each year of the contract for first time run series, and 3% for reruns.

From the DGA factsheet under the healthcare heading; Employers continue to make health care contributions at specially negotiated rate of 8.5%, secured in the 2005 Basic Agreement to address the impact of the growing cost of health care on the DGA Plan. Provisions permitting decrease in contribution rate by employers removed.

However the biggest gains were in the New Media arena. Directors will receive jurisdiction over over all new media content that is derivative of products already covered under current contracts, and over all original content.

Electronic Sell-Through (EST), or Paid Downloads, sees the rate more than double that currently paid by the employers on television programming to .70% above 100,000 units downloaded. Below that breakpoint, the rate will be paid at the current rates of .30% until worldwide gross receipts reach $1 million, at which point it rises to .36%.

There is more, with changes in distributor’s gross, ad-supported streaming payments and over promotional clips. In addition, and finally, there is a sunset provision which allows for new media to be revisited when the contract expires.

The End

Hopefully – as mentioned – this deal will bring the WGA back to the table for a successful completion of negotiations, which fell through late last year, and again early this year. But regardless of whether they make it back to the table in the next week or month, television will be irreversibly damaged well in to 2009’s scheduled programming.

Thanks to Variety for added information

0 Yes
0 No
Joshua S. Hill