# WGA Strike Explanation



## Vito the TiVo (Oct 27, 2003)

An excellent explanation of what the WGA is striking for:






Support the strike in your own way. Refuse to watch any of the reality crap that the network are going to shove down our throats by January.


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## hefe (Dec 5, 2000)

Vito the TiVo said:


> An excellent explanation of what the WGA is striking for:
> 
> 
> 
> ...


If a particular "reality" show is good and entertains me, I'll watch it. If not, I won't. Pretty much the same standard I set for "scripted" entertainment.


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## whitson77 (Nov 10, 2002)

Vito the TiVo said:


> An excellent explanation of what the WGA is striking for:
> 
> 
> 
> ...


Done. I hate all reality shows with a passion anyway.


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## visionary (May 31, 2006)

I have a simple question? What additional work or effort are the writers doing that they should get paid again just because something goes on a DVD or internet? And a good follow up, do they also then want to share in failures, such as returning part of their pay to the producers, when they write a bad show that fails? The producers lose, why not those writers then should lose too?

Fair is fair, and what they want would be like you having to pay for your car again to its maker if it became more valuable later to you. Like you used it in your business and had not before, so now pay the maker again, how would you like that? Or, how would you all like to pay software "licenses" every year for your automobile, TV, even your electronic video games? That is exactly where this will lead if done.

What the writers should do is simply get a higher payment when they write, because it may well be used many ways, and get paid once like everyone else. Who else among you gets paid again for work already paid you for years ago? Does the painter get paid again for his famous paintings, after he sold them the first time, or is it the current owner who gets the appreciation?


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## Fleegle (Jan 15, 2002)

visionary said:


> I have a simple question? What additional work or effort are the writers doing that they should get paid again just because something goes on a DVD or internet? And a good follow up, do they also then want to share in failures, such as returning part of their pay to the producers, when they write a bad show that fails? The producers lose, why not those writers then should lose too?
> 
> Fair is fair, and what they want would be like you having to pay for your car again to its maker if it became more valuable later to you. Like you used it in your business and had not before, so now pay the maker again, how would you like that? Or, how would you all like to pay software "licenses" every year for your automobile, TV, even your electronic video games? That is exactly where this will lead if done.
> 
> What the writers should do is simply get a higher payment when they write, because it may well be used many ways, and get paid once like everyone else. Who else among you gets paid again for work already paid you for years ago? Does the painter get paid again for his famous paintings, after he sold them the first time, or is it the current owner who gets the appreciation?


You could ask the same for actors, directors, producers, etc. If nobody got residuals, then it would be another matter, but it's a standard in the industry.


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## visionary (May 31, 2006)

Well, Fleegle, all the more reason to stop it now before it gets bigger. I bet your home went up in value a lot in last few years. Are you wanting to get a bill from the builder so he can share in this appreciation from his good work, or do you feel he was paid at the time?


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## loubob57 (Mar 19, 2001)

But after you build a car or a house the manufacturer doesn't get continued profit on it. That's what the writers want. If their work is bad then it won't sell in reruns or DVDs, so they won't get any extra. If their work is brilliant it may sell for decades after it was first done. If that's the case should the studio be the sole recipient of the profit?

I realize you can argue this topic both ways, but it sure doesn't look unreasonable to me to throw the writers a bit of cash if their work is good.


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## Jon J (Aug 23, 2000)

Vito the TiVo said:


> Support the strike in your own way. Refuse to watch any of the reality crap that the network are going to shove down our throats by January.


Have never and will never waste my time on a "reality" show.


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## MegaHertz67 (Apr 18, 2005)

visionary said:


> Well, Fleegle, all the more reason to stop it now before it gets bigger. I bet your home went up in value a lot in last few years. Are you wanting to get a bill from the builder so he can share in this appreciation from his good work, or do you feel he was paid at the time?


My local government certainly wants more money from me if my property value increases, but that is neither here nor there.

I understand the union's position. They already get paid for residuals for a, b, and c. All of a sudden when new technology like d, e, and f get developed, they want a piece of that too. Especially if d, e, and f reduce demand for a, b, and c. If you were in their shoes, you would want that too.

I also understand the producer's holding firm because they still have actors and directors watching this negotiation in preparation for their deals coming up next year. And "most favored nations" clauses in a lot of these deals say that if you do for one, you pretty much have to do for all. So they are playing hardball with the writers so they don't have to play hardball with the actors and directors.

Believe me the unions for actors and directors are chiming in and giving advice to the writer's union...they are all in this together. The only problem is that in the meantime OUR entertainment is collateral damage in this skirmish.

Thank goodness for DVDs and Discovery Channel. It may be a while before I run out of things to watch.


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## ping (Oct 3, 2005)

loubob57 said:


> I realize you can argue this topic both ways, but it sure doesn't look unreasonable to me to throw the writers a bit of cash if their work is good.


And that right there is what I hate about labor unions. They bargain on behalf of the whole group, not just the small subset of that group that actually deserves what they're negotiating.


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## NJChris (May 11, 2001)

ping said:


> And that right there is what I hate about labor unions. They bargain on behalf of the whole group, not just the small subset of that group that actually deserves what they're negotiating.


Huh? But only those who have sales of their work on the other mediums will get residuals, not people who don't have their items selling in the other "formats".

Visionary, you are comparing apples to oranges to try to make your point. Use an industry that has the same model and your arguments will fit.


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## IJustLikeTivo (Oct 3, 2001)

Fleegle said:


> You could ask the same for actors, directors, producers, etc. If nobody got residuals, then it would be another matter, but it's a standard in the industry.


Like any business, the idea is to pay as little as possible to produce something while selling it for as much as possible. The person who puts up the money to produce and takes the risk of selling or not selling makes the money. The person is the producer.

Over the years, in order to get or retain talent, the producers have agreed to change that set up and allow profit participation to get the talent they wanted to make a good movie. Originally, the actors gave up salary in return for points thereby sharing the risks. The vast majority of actors still get paid in straight salary, only the most desired or bankable stars negotiate a salary and points. And, each negotiates a new agreement for each movie. Writer's want to get a negotiated salary PLUS a percentage without taking any risk. If they are in high enough demand, they have always had the option to negotiate such a deal but, to date, they have not been able to do so. That's business.

I think unless they take a risk, they are just like a car maker. The manufacturer pays people to design a car and then pays to build factories and assembly plants and build cars and hope someone buys them. If they don't, the manufacturer loses money but the designer still got paid. He/she had no risk and therefore gets no cut. What other industry pays based on the way the authors want?


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> An excellent explanation of what the WGA is striking for:
> 
> 
> 
> ...


Not to be confused with the cheap writerless crap they have now. 16 reality programs, 3 games shows etc etc etc. It's price to produce Vs value in ad revenue. Reality and game shows are cheap and still generate good ad revenue. Econ 101.


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## visionary (May 31, 2006)

NJ, the idea is let's stop this "model" from growing before you do see others wanting to do the same thing, such as I mention. You think they wouldn't see that it worked, if it does? We'd soon be re-paying artists for paintings that sold well at auction years later, same for old classic cars, you'd pay forever, I sure see why this has to stop. One above mentions how it could be like taxes, yes, that is right on, do you want to be paying new taxes like that to share everything successful you do but never share any losses with them? At least even taxes let you offset with your losses. This is much worse and much more unfair.


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## TAsunder (Aug 6, 2003)

Ah, yes, the slippery slope argument.


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## hefe (Dec 5, 2000)

visionary said:


> We'd soon be re-paying artists for paintings that sold well at auction years later, same for old classic cars, you'd pay forever, I sure see why this has to stop.


I don't see that as even similar.

Besides, if someone wants to put conditions on the sale of something that results in additional revenues in the future, they are free to try and do that right now...draw up a contract and see who will buy into that. That's something you can negotiate between a buyer and a seller.

This negotiation between this union and it's employers doesn't impact any of that.


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## trainman (Jan 29, 2001)

I posted this over in the writers' strike thread on Happy Hour, but I guess it perhaps should be posted here, too: an explanation of why TV writers get residuals (however, note that it's written by a member of the WGA -- things might be slightly different from the producers' perspective).


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## Vito the TiVo (Oct 27, 2003)

IJustLikeTivo said:


> The vast majority of actors still get paid in straight salary, only the most desired or bankable stars negotiate a salary and points. And, each negotiates a new agreement for each movie...


I'm sorry, but you're absolutely wrong. Huge actors negotiate for "profit participation" but all SAG actors in SAG productions that have speaking roles receive "residuals"... even though it sometimes amount to a very tiny amount.

http://answers.google.com/answers/threadview?id=264595

Actors, Directors and Writers receive residuals on their work, just like musicians, authors, photographers etc. You continue to complain on these boards that writers don't take on the financial risk, and that producers do... and that is the reason why producers and studios keep the lion's share of profits. But there would be no lion's share of the profits without the right creative people behind the product. To deny residuals to the creative teams that made it possible is simply to be greedy. Residuals are a part of the payment system of artistic endeavors - always has been and always will be.

I personally think that the team that designed a particular car should receive residuals if the company continues to make money off of that design. And yes, there are below the line crewmembers that should have a tiny slice of the residual pie as well...


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## marksman (Mar 4, 2002)

I don't need to see their explanation. I know why they are striking. They want more money.

Not anything terribly sympathetic about it, nor do I really support them. I say they got to do what they think they got to do, and surely the studios are getting an enormous pie to divy up...

So I don't feel sorry for any of them.. and I certainly am not going to join in any boycott or support for them.

The reality is with the changing landscape this whole action is only hurting themselves and the studios. They are going to all be big losers out of this. Regardless of how it is settled.


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## marksman (Mar 4, 2002)

Jon J said:


> Have never and will never waste my time on a "reality" show.


How about I don't believe you.

Sure it is a nice thing to say to get attaboys from tv snobs, but the fact that you visited a tv forum makes it nearly impossible you have never watched any reality tv show.

If you have never watched ANY of it, you would certainly not be in a position to judge it as a waste of time or not.

Essentially what I am calling you out on, is you made the statement as a means of glorifying yourself when it really just makes you look incredible ignorant and/or a liar.


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## smak (Feb 11, 2000)

People are continuing to confuse back end deals with residuals, and they are two entirely different things.

And why do people think that TV producer's have a financial stake in a show?

Does Tim Kring pay to produce episodes of Heroes? Marc Cherry Desperate Housewives? Jerry Bruckheimer CSI???

No. They negotiate with the studios to pay them a certain amount of money for each episode, and then they pay the actors, directors, writers etc.. with that money.

None of these people put up their own money on the projects. It's not like putting up money to make a film, and then hope it gets picked up at Cannes.

-smak-


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## Dr_Diablo (Nov 24, 2003)

Vito the TiVo said:


> An excellent explanation of what the WGA is striking for:
> 
> 
> 
> ...


You could take it one step further by not purchaseing poducts mentioned during the airing of these programs

The list is endless of options


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## IJustLikeTivo (Oct 3, 2001)

smak said:


> People are continuing to confuse back end deals with residuals, and they are two entirely different things.
> 
> And why do people think that TV producer's have a financial stake in a show?
> 
> ...


That's just so wrong it's hard to know where to start. Yes, they get money to make the shows, but the money they are paid is NOT what it costs. Were it not for syndication or other ancillary profit sources, the production company would LOSE money on virtually all shows. At the end, each Friends show cost 6 million per episode in salary alone, add to that writers, directors, studio costs and then subtract the standard fee paid by the studio and they operate at a loss. The studio can't afford to foot the bill for the full production cost. If they don't make enough episodes to justify either syndication or DVD sales, the production company loses money. All TV shows operate in deficit. Some never enter a profit. Before DVD, they pretty much never made money until the had enough money to sell into syndication which was a minimum of 100 episodes. Many shows never made that many so they were never syndication and they lost money.


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> I'm sorry, but you're absolutely wrong. Huge actors negotiate for "profit participation" but all SAG actors in SAG productions that have speaking roles receive "residuals"... even though it sometimes amount to a very tiny amount.
> 
> http://answers.google.com/answers/threadview?id=264595
> 
> ...


As someone else pointed out, residuals aren't the same thing, they are defrered compensation when shows are rebroadcast. What the writers want is a percentage of ancillary sales (DVD, or Internet).

Large actors don't generally get percentages of TV viewing etc directly, the negotiate a percentage of either the gross ( before costs, strictly box office receipts ) or net ( after costs relfecting the true profit of the cost after production and marketing costs). They don't get residuals in the standard sense of the word.

BTW, while I'm sure others in industries who do the background work would like profit they're not likely to get it. If you remove the incentive to control costs to make a profit which drives production, there won't be profit and no one will make movies or TV shows. If makes sense is every sense of capitalism that the people putting the money at risk get to make the profit. They own the work since the paid the writers, the actors, the directors, the production staff etc. Absent them paying for all that, there is NO product to see and unless the others give up security in the form of a guaranteed paycheck, why should they share in the success. Risk = reward. Play it safe = make a living without significant risk but with attendantly lessor rewards.


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## Vito the TiVo (Oct 27, 2003)

IJustLikeTivo said:


> As someone else pointed out, residuals aren't the same thing, they are deferred compensation when shows are rebroadcast. What the writers want is a percentage of ancillary sales (DVD, or Internet).
> 
> Large actors don't generally get percentages of TV viewing etc directly, the negotiate a percentage of either the gross ( before costs, strictly box office receipts ) or net ( after costs relfecting the true profit of the cost after production and marketing costs). They don't get residuals in the standard sense of the word.


I'm sorry, but you are wrong again. The writers currently get 2.5% residuals on television broadcasts. They get something akin to .04 a DVD in _residuals_. They get _nothing_ in residuals from free internet shows, despite ad time being sold. The writers are fighting for their fair share of _residuals_. This is, as you said, deferred compensation... not profit participation. These residuals are always paid in increasing amount depending on how much the material is used.

And actors _always_ get the SAG negotiated residuals, regardless of what they may have negotiated as their net or gross participation deals.


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## smak (Feb 11, 2000)

IJustLikeTivo said:


> BTW, while I'm sure others in industries who do the background work would like profit they're not likely to get it. If you remove the incentive to control costs to make a profit which drives production, there won't be profit and no one will make movies or TV shows. If makes sense is every sense of capitalism that the people putting the money at risk get to make the profit. They own the work since the paid the writers, the actors, the directors, the production staff etc. Absent them paying for all that, there is NO product to see and unless the others give up security in the form of a guaranteed paycheck, why should they share in the success. Risk = reward. Play it safe = make a living without significant risk but with attendantly lessor rewards.


But your whole solution to the fact that you don't think writer's should get residuals, is that you don't think actors or director's should either.

That's hardly a solution since the fact is that they do, and there's no way to unring that bell.

You have to work in the real world. And the real world reality is that 2/3 of the major creative process get paid for something and 1/3 don't.

What happens to book writers, or any other profession on the face of the Earth has absolutely no baring on this particular situation.

You think that if there were 3 equal parts to a car assembly line, and 2 of those parts got paid $10 per car sold, and 1 part didn't, they wouldn't pitch a fit?

-smak-


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> I'm sorry, but you are wrong again. The writers currently get 2.5% residuals on television broadcasts. They get something akin to .04 a DVD in _residuals_. They get _nothing_ in residuals from free internet shows, despite ad time being sold. The writers are fighting for their fair share of _residuals_. This is, as you said, deferred compensation... not profit participation. These residuals are always paid in increasing amount depending on how much the material is used.
> 
> And actors _always_ get the SAG negotiated residuals, regardless of what they may have negotiated as their net or gross participation deals.


They are NOT ALWAYS paid. They negotiated a rate and now want more. My point was that they say in the video that they get 2.5 in residuals then later say they get 4 cents out of 20 dollars on the DVD. Whether they intend the meaning to be the same or different isn't clear but the result is clear, they don't make the case for why it's different. I hope they write better.

There is NOTHING in copyright law the obligates the owner of the video to do anything. They have negotiated a deal and now want something different. Also, clearly since they aren't getting it by definition, it is not as you say "are always paid in increasing amount depending on how much the material is used". The made a bargain and now the writers want to change. Why that is not done on a one by one basis I don't understand. I certainly don't argue for my compensation based on what everyone else gets, I ask for what I want and am willing to work for. I guarantee there are writers out there who would be thrilled to get the same deal they have now.

Obviously, we're not going to agree but the video in question is poorly presented and makes no distinction between legal rights, negotiated rights, residuals and profit participation. All the TV coverage presents it as they want more money without making a similar distinction. If they can't do a good job of presenting their case to the public, they certainly aren't going to get much sympathy.


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## IJustLikeTivo (Oct 3, 2001)

smak said:


> But your whole solution to the fact that you don't think writer's should get residuals, is that you don't think actors or director's should either.
> 
> That's hardly a solution since the fact is that they do, and there's no way to unring that bell.
> 
> ...


Fair point but they agreed to it. Some people where I work make more than me, they did a better job of negotiating a compensation package. I know that now and that will affect how I negotiate my next raise or, if needed, my next job. Same rights they have here. But, if they want to get sympathy, they need to do a much better job of showing why THEY deserve the money and not just use the "we want what they got argument".


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## bareyb (Dec 1, 2000)

I have a bad feeling this may end up to be a "long one". Especially if the public sentiment goes out to the writers. I can't find much sympathy for them myself and I have no intention of doing anything like boycotting whatever filler shows the networks can provide for us. I'm not particularly sympathetic towards either side. I just want it over quickly. 

To sum up, I don't really have a dog in this fight but I think it sucks that they can't work things out without it affecting me.


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## Vito the TiVo (Oct 27, 2003)

IJustLikeTivo said:


> They are NOT ALWAYS paid. They negotiated a rate and now want more. My point was that they say in the video that they get 2.5 in residuals then later say they get 4 cents out of 20 dollars on the DVD. Whether they intend the meaning to be the same or different isn't clear but the result is clear, they don't make the case for why it's different. I hope they write better.


It seems perfectly clear to me and I'm not sure why I can't explain it to you:

*Currently:*
Television broadcast = *2.5% residual*
DVD/Video = they struck for video residuals in 1988 had to settle because "video was new" with the understanding that it would go up when profitable = *0.3% residual * up to $1 million gross; *0.36% above* that
Internet (paid - itunes, etc) = *0.3% residual * up to $1 million gross; *0.36% above* that
"free" internet (that the studio still makes money on) = *0% residuals*

*WGA wants:*
Television broadcast = *2.5% residual*
DVD/Video = *0.6% residual * up to $1 million gross; *0.72% above* that
Internet (paid - itunes, etc) = *2.5% residual *
"free" internet (that the studio still makes money on) = *2.5% residual *

They changed at the last minute to drop DVDs to discuss the future of the last two.

*AMPTPs proposal (not really one/the same old deal):*
Television broadcast = *2.5% residual*
DVD/Video = *0.3% residual * up to $1 million gross; *0.36% above* that
Internet (paid - itunes, etc) = *0.3% residual * up to $1 million gross; *0.36% above* that
"free" internet (that the studio still makes money on) = *0% residual *

plus other rollbacks that they took off the table as a "concession"

Keep in mind that many are of the belief that the "television broadcast" category will soon be usurped by the "internet" category with new technologies falling under that banner.

And my understanding is that "internet" has never really truly been negotiated prior to now. So this isn't a pay increase in that sense. It's just being paid.


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## hefe (Dec 5, 2000)

Dr_Diablo said:


> You could take it one step further by not purchaseing poducts mentioned during the airing of these programs
> 
> The list is endless of options


I'm confused as to why this is something I (or anybody who isn't one of the parties involved) need to take any action on. It's not our issue.

The producers, or studios, or whomever have something the writers want: Writing jobs.

The writers have something their bosses want: Writing talent.

They need to agree on what it will take to exchange one for the other.

When they work that out, they'll get back to work. In the meantime, they all lose money. That's their choice.

I enjoy the products they produce as much as the next person, but really, I'm not all that broken up about it, and not particularly motivated to take sides. If they come back, great. If not, who knows...maybe it's better. I watch too much TV as it is.


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## hefe (Dec 5, 2000)

IJustLikeTivo said:


> They are NOT ALWAYS paid. They negotiated a rate and now want more.


Just out of curiosity, if anyone knows...when was the last contract negotiated, and when was it scheduled to run until...?


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## Vito the TiVo (Oct 27, 2003)

hefe said:


> I'm confused as to why this is something I (or anybody who isn't one of the parties involved) need to take any action on. It's not our issue.


In a sense, you're right.

The only reason for you to be involved is if you want to support unionized labor in general against "big business" or if you feel a certain kinship to your favorite shows and want to see the people behind them rewarded for making a product that you love.

Unfortunately for a lot of us in Los Angeles, even if you're someone not directly employed in television, you're still a directly affected party.


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## Vito the TiVo (Oct 27, 2003)

hefe said:


> Just out of curiosity, if anyone knows...when was the last contract negotiated, and when was it scheduled to run until...?


Was the last one in 2001? At any rate, it ran until 12:01am November 1st.


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## hefe (Dec 5, 2000)

Vito the TiVo said:


> Was the last one in 2001? At any rate, it ran until 12:01am November 1st.


So, the existing contract is up then? They're not *re*negotiating anything. They're negotiating the terms for a new deal to replace an expired one.

Just wanted to be clear on that. If there's no deal in place, then the 2 sides can have at it, and decide what is good enough for them all to accept.

If they were refusing to work under an existing contract, then I might have less sympathy for the writers' side of it. As it is, they've got as much right to try and get as much for their capital (writing talent) as the studios do for theirs. At some point, they'll find terms both can accept.


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## Rob Helmerichs (Oct 17, 2000)

Yes, the contract expires every few years and has to be re-negotiated. Historically, those renegotiations have resulted in rollbacks by the studios.  This time, the writers have drawn a line in the sand.


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## dansee (Oct 23, 2003)

hefe said:


> Just out of curiosity, if anyone knows...when was the last contract negotiated, and when was it scheduled to run until...?


Last full vote was in 2001 (general guidlines/base). But various contracts (depending on specialty) have been renegotiated in the interim. WGA-CBS is an example of a contract that was never renewed (guild members have been working without a contract since 2005, and no pay raise since 2004) -- this in the news, promotion, copywriting areas.

The screenwriters last negotiated a new contract in '04, and the vote was incredibly tight.


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## dswallow (Dec 3, 2000)

Vito the TiVo said:


> *Currently:*
> Internet (paid - itunes, etc) = *0% residual *


According to this (see 3B) such paid downloads do indeed result in residuals at the same rate as home video is paid.


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## LoadStar (Jul 24, 2001)

The most interesting thing about all of this, in my opinion, is the unexpected place of one of the 'flashpoints' that led to the strike... Sci-Fi's "Battlestar Galactica." 

Fans of the series probably recall the "webisode" miniseries Battlestar Galactica: The Resistance. Despite being written and filmed precisely as a TV episode would have been, and attracting significant viewers online, NBC Universal deemed the episodes "promotional materials" rather than original creative content, and therefore nothing needed to be paid to the writers for them.

It's interesting that a show like Battlestar Galactica that is commonly overlooked, is actually changing Hollywood.


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## dswallow (Dec 3, 2000)

Like most union strikes I think this one results in everybody losing. I'd like to see a real (non-Hollywood-accounting) accounting at the end of the strike of how much ADDITIONAL money the writers got and how much money all the affected employees, including the writers, didn't earn because they were on strike. How many years will it be before the end results of the strike pay off?

Actually Hollywood studios make out; they do reduce their costs drastically during the strike, but all the laid-off workers affected by the strike (not even counting those actually on strike) still have to pay their mortgage and their utilities and buy food but now have no income.

I'd venture to say that all a strike really does is make Hollywood studios richer and workers poorer.


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## busyba (Feb 5, 2003)

Vito the TiVo said:


> An excellent explanation of what the WGA is striking for:


Did the WGA get permission to use those copyrighted images from I Love Lucy?


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## bengalfreak (Oct 20, 2002)

dswallow said:


> Like most union strikes I think this one results in everybody losing. I'd like to see a real (non-Hollywood-accounting) accounting at the end of the strike of how much ADDITIONAL money the writers got and how much money all the affected employees, including the writers, didn't earn because they were on strike. How many years will it be before the end results of the strike pay off?
> 
> Actually Hollywood studios make out; they do reduce their costs drastically during the strike, but all the laid-off workers affected by the strike (not even counting those actually on strike) still have to pay their mortgage and their utilities and buy food but now have no income.
> 
> I'd venture to say that all a strike really does is make Hollywood studios richer and workers poorer.


And that's exactly how studios (and other corporations) hope that labor views a strike. No one ever wins a strike, that much is true. But if there is never anything important enough to strike over, than business will constantly erode the earnings power and benefits of its employees. That much is also true.


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## IJustLikeTivo (Oct 3, 2001)

bengalfreak said:


> And that's exactly how studios (and other corporations) hope that labor views a strike. No one ever wins a strike, that much is true. But if there is never anything important enough to strike over, than business will constantly erode the earnings power and benefits of its employees. That much is also true.


I can't guess which side you're on.

Actually the free market works pretty well. If the labor pool is tight and there is competition for talent, wages so us simply cause they have too. As long as the talent pool exceeds the available jobs, the pay will be low.

That's not "the man" beating up employees, that's econ 101. Pay as little as possible to make and sell for as much as possible. If the writers can find another market that pays better, they'll go there.


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## Vito the TiVo (Oct 27, 2003)

dswallow said:


> According to this (see 3B) such paid downloads do indeed result in residuals at the same rate as home video is paid.


You're correct. I've adjusted my original post. That's 0.3% that they make on iTunes, etc. But then unfortunately, if I've read the AMPTP correctly, it means that they are offering the WGA no adjustment at all?


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## Vito the TiVo (Oct 27, 2003)

busyba said:


> Did the WGA get permission to use those copyrighted images from I Love Lucy?


It's a non-commercial use, so no payments are forthcoming. Ironically though, even if it was a commercial use, the WGA would have to pay the corporation, with no money going back to the families of any of the creative types involved... due to the crappy deal that used to be in place.


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## busyba (Feb 5, 2003)

Vito the TiVo said:


> It's a non-commercial use, so no payments are forthcoming.


Even if it's non-commercial use, unless it's Fair Use, it's infringement.


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## doom1701 (May 15, 2001)

I just can't believe anybody cares. There are people, including in this thread, that seem to feel as if their mom won't be able to eat tonight if the WGA doesn't get their way. Ultimately the studios and the writers will reach an agreement, and I don't expect any real changes to my television viewing.

Ford or GM goes on strike? That's news that I think people might care about. WGA goes on strike? Big whoop.


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## AJRitz (Mar 25, 2002)

IJustLikeTivo said:


> Fair point but they agreed to it. Some people where I work make more than me, they did a better job of negotiating a compensation package. I know that now and that will affect how I negotiate my next raise or, if needed, my next job. Same rights they have here. But, if they want to get sympathy, they need to do a much better job of showing why THEY deserve the money and not just use the "we want what they got argument".


[sigh]
And this is why contracts have expiration dates.
The writers agreed to the current situation in a prior contract. Since that agreement, new distribution methods and revenue streams have developed. The producers have reaped (and stand to continue to reap) a windfall based on the new distribution methods and revenue streams. It is perfectly logical and reasonable that when the prior contract expired that the writers would refuse to agree to the same terms that were in the _now expired_ contract, when the economic landscape has shifted.


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## dswallow (Dec 3, 2000)

Vito the TiVo said:


> You're correct. I've adjusted my original post. That's 0.3% that they make on iTunes, etc. But then unfortunately, if I've read the AMPTP correctly, it means that they are offering the WGA no adjustment at all?


You may also want to update your chart to show both those residual payments are at two tiers... 0.3% on the first $1 million gross; 0.36% on the rest.


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## busyba (Feb 5, 2003)

doom1701 said:


> I just can't believe anybody cares. There are people, including in this thread, that seem to feel as if their mom won't be able to eat tonight if the WGA doesn't get their way. Ultimately the studios and the writers will reach an agreement, and I don't expect any real changes to my television viewing.
> 
> Ford or GM goes on strike? That's news that I think people might care about. WGA goes on strike? Big whoop.


Well, you live in Michigan, so Ford or GM going on strike would have a ripple effect that hits people in your area.

The same holds true for this strike in LA. The entertainment industry is the most important element of the local economy in LA and other parts of California. If the industry shuts down, it effects a lot of people, directly and indirectly, and the people effected go beyond just the rich people who can afford to not work for a few weeks.


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## DevdogAZ (Apr 16, 2003)

doom1701 said:


> I just can't believe anybody cares. There are people, including in this thread, that seem to feel as if their mom won't be able to eat tonight if the WGA doesn't get their way. Ultimately the studios and the writers will reach an agreement, and I don't expect any real changes to my television viewing.
> 
> Ford or GM goes on strike? That's news that I think people might care about. WGA goes on strike? Big whoop.


For the majority of people in this country, the WGA strike will have a much bigger impact on their lives than a strike at Ford or GM. Let's be honest. The percentage of Americans who buy a new car from one of the U.S. automakers in any given period is pretty low. The percentage of Americans who enjoy some form of entertainment written by members of the WGA in that same period of time is significantly higher. Therefore, most people won't care if the assembly lines shut down, as they weren't going to buy a car anyway, and they might actually benefit from lower prices while the automaker tries to recover. However, most people will notice and care if their favorite TV show is pulled from the air because there's nobody to write it.

If you want to argue the effects on the economy, that's a completely different story, so don't try to use that as a rebuttal to my points.


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## IJustLikeTivo (Oct 3, 2001)

AJRitz said:


> [sigh]
> And this is why contracts have expiration dates.
> The writers agreed to the current situation in a prior contract. Since that agreement, new distribution methods and revenue streams have developed. The producers have reaped (and stand to continue to reap) a windfall based on the new distribution methods and revenue streams. It is perfectly logical and reasonable that when the prior contract expired that the writers would refuse to agree to the same terms that were in the _now expired_ contract, when the economic landscape has shifted.


I'm not sure what the sarcastic sigh is for?

Sure, they have a right to negotiate a new contract, I never said otherwise. I DO think they haven't done a great job of making their case. The video referred to is pretty confusing on the residuals issue and mixes the revenue from different revenue streams as if they were the same. Complaining that you don't get what the contract says you don't get is pointless. You agreed to that. Now, if you want more, make a case for it. That's what negotiation is about.


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## hefe (Dec 5, 2000)

busyba said:


> Even if it's non-commercial use, unless it's Fair Use, it's infringement.


True, and most people think that Fair Use is more than it is.

I do suspect, though, that their usage here could be viewed as such.


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## busyba (Feb 5, 2003)

hefe said:


> I do suspect, though, that their usage here could be viewed as such.


I hope not... just because I love irony.


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## hefe (Dec 5, 2000)

busyba said:


> I hope not... just because I love irony.


Even so, they probably violated the DMCA in _getting _the images.


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## Vito the TiVo (Oct 27, 2003)

dswallow said:


> You may also want to update your chart to show both those residual payments are at two tiers... 0.3% on the first $1 million gross; 0.36% on the rest.


I was trying to keep it simple, yet more complex than their nonsense $.04 repetition that doesn't say anything for those that actually understand numbers.

But you're right, I'll add it.


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## IJustLikeTivo (Oct 3, 2001)

I think part of the problem is that everyone is stuck using the same old ideas but just using a new platform to deliver the same product. Just as books on tape or now download was a new mechanism, the internet presents entirely new and yet to be invented ideas for how to deliver what writer's do. Writer's have fertile imaginations, use them.

Deliver a new kind of content. Mixed media, serial stories via subscription. Own the entire pie instead of competing for table scraps. If you don't like working for "the man", become 'the man'.

The internet has existed for more than 10 years now and the content is still the same, it's just a new channel. Some shows have tried to integrate the two steams ( like jericho did last year with Web enhancements). The internet presents a whole new possibility for delivery and one where traditional media outlets can be completely bypassed. Instead of tying themselves to a dying business model like the RIAA, I'd like to see something completely new and different.


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## f0gax (Aug 8, 2002)

Vito the TiVo said:


> The only reason for you to be involved is if you want to support unionized labor in general against "big business"...


Thanks. That's the funniest thing I've read in days. The WGA versus the studios related to labor versus "big business". Did you feel the same way when baseball players went on strike?

Nothing against you, just thought it was a funny thing to say.

Through a series of links, I ended up at this article. Basically, entry-level salary for WGA writers is $70,000 per season. And that's for half a year's work. It looks like it's not too hard to crest the 6 figure mark even as a "junior" writer. This is hardly the wagon to hitch one's "little guy vs. big business" argument to.


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## smak (Feb 11, 2000)

You think the lowest salary of any WGA member is 70k a year? I'm pretty sure the lowest salary is $0, and a lot of people make that.

-smak-


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## Vito the TiVo (Oct 27, 2003)

Sigh. And that's why this strike is going to go on for 9mos. to a year. The average American has no sympathy simply because the pay scales are so different... even though that means that the corporations simply get even more money and more power and strikes another blow against unionized labor.

Meanwhile the corporations keep thousands unemployed to squeeze more out of their products, rather than just be fair and negotiate on the residual basis that had already been established.

Broadcast television will be replaced by some form of hybrid technology that will be classified as "internet". This is not the writers striking for more money, this is the writers striking for the same money.


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## DevdogAZ (Apr 16, 2003)

Vito the TiVo said:


> Sigh. And that's why this strike is going to go on for 9mos. to a year. The average American has no sympathy simply because the pay scales are so different... even though that means that the corporations simply get even more money and more power and strikes another blow against unionized labor.
> 
> Meanwhile the corporations keep thousands unemployed to squeeze more out of their products, rather than just be fair and negotiate on the residual basis that had already been established.
> 
> Broadcast television will be replaced by some form of hybrid technology that will be classified as "internet". This is not the writers striking for more money, this is the writers striking for the same money.


Why does the sympathy of the average American have anything to do with it? The two sides are negotiating with one another, not with opinion polls. They need to determine what is in the best interest of their constituency, not the public at large. They have no duty to us.


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> Sigh. And that's why this strike is going to go on for 9mos. to a year. The average American has no sympathy simply because the pay scales are so different... even though that means that the corporations simply get even more money and more power and strikes another blow against unionized labor.
> 
> Meanwhile the corporations keep thousands unemployed to squeeze more out of their products, rather than just be fair and negotiate on the residual basis that had already been established.
> 
> Broadcast television will be replaced by some form of hybrid technology that will be classified as "internet". This is not the writers striking for more money, this is the writers striking for the same money.


I don't think this is anti-union at all. Hollywood has more unions than a Rockefeller baby has rattles.

It's business. The producers think they can get the writer's to agree to less than others make. Pure and simple. If they are wrong, the producers will give in and the writer's will make more money. It they are right, the opposite is true. In non union work places each person is free to negotiate the pay they feel is equitable. Sometimes that works out great, sometimes not. In my case, when I started at my current place, the market was a bit soft and I wasn't able to get the salary I wanted. Jump forward 1.5 years and the market was much better and we have to pay people 25-30K more to get people with less experience. Does that make me happy? No but looking long term I still see a future there. When I don't, I'll look elsewhere as they are free to do.

As I said earlier, as long as they stick to one method to make money and don't become their own bosses, they greatly limit their options.


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## Vito the TiVo (Oct 27, 2003)

DevdogAZ said:


> Why does the sympathy of the average American have anything to do with it? The two sides are negotiating with one another, not with opinion polls. They need to determine what is in the best interest of their constituency, not the public at large. They have no duty to us.


The american public has the power because financial pressure is the only thing that each side can put on each other at this point, and while the studios can crush any union financially, only the american public has the ability to make the corporation feel the pinch.


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## DevdogAZ (Apr 16, 2003)

Vito the TiVo said:


> The american public has the power because financial pressure is the only thing that each side can put on each other at this point, and while the studios can crush any union financially, only the american public has the ability to make the corporation feel the pinch.


And as evidenced in this thread and the many others relating to the strike, the American public is definitely not of one mind about this issue. No matter what the specifics or how long it takes, both sides will be damaged because some portion of the public will hold them accountable.


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## Vito the TiVo (Oct 27, 2003)

IJustLikeTivo said:


> If they are wrong, the producers will give in and the writer's will make more money...


I keep repeating, this is not about making *more *money. This is about protecting the residuals that they already have. In the case of the internet residuals (which is what they're really worried about) they're concerned that they're only paid 0.3% vs. the 2.5% on television broadcasts. They are right to think that internet or future delivery methods that will be classified as internet will lessen the amounts received from broadcasts and eventually usurp it all together.

They want 2.5% and the producers are offering no increases on paid downloads and nothing at all on streaming media. That's stone-walling trying to bilk the writers out of more and more and more money over time.

You're clearly some one who believes in free market and continues to use the example of your own career and pay. So let me make it personal with me for a second. Moguls withholding every thin dime from the writers means that not only do they shut down the industry in the short term, but they'll withhold it from directors, actors and every below the line tradesperson whose residuals are paid into their unions benefits packages. This means a lot of hardship for everyone, all for corporate greed. Politically, I also disagree with the way that Wal-Mart does business. Sometimes free trade and letting the market set the price means that corporations grow fat while individual lives are destroyed. This is wrong on every level, no matter what your politics. Personally I am debating leaving the industry all together because this strike is going to last 9mos and its going to be impossible for some to make a living wage to sustain in Los Angeles. My fiancee is debating cancelling a wedding, because we will no longer be able to afford it. We're already in dire straits because of the falling California housing market. I don't blame the writers, they've drawn a line for all of us because they believe that they have the power to affect change now. I fear that they are wrong. Television lost 10% of viewers permanently after the 1988 strike, and the impact is going to be much higher this time. It's going to result in studio demanding lower costs, which puts the pressure on tradespeople to accept lower wages due to the scarcity of work. Tout free market economics all you want, but its going to destroy a lot of lives and rock sectors of the national economy, whether anyone wants to acknowledge it or not.

Remember, we're in Day four of the strike. Come back and chat me up in day 275 and tell me if you think the corporations are still justified in refusing to negotiate with the Union at all.


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## dswallow (Dec 3, 2000)

Id' fully support a writers strike if it shut down production of, and only of, every reality show.

But they're shutting down shows I watch; so I really don't care right now and will soon, gradually, move to the "I don't support the strike" category.


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## busyba (Feb 5, 2003)

DevdogAZ said:


> And as evidenced in this thread and the many others relating to the strike, the American public is definitely not of one mind about this issue. No matter what the specifics or how long it takes, both sides will be damaged because some portion of the public will hold them accountable.


Sometimes there's TV to watch and sometimes there's not. That goes on all the time without the benefit of a strike. With between-sweeps reruns and summer re-runs, people are generally accustomed to not always having new shows to watch. If there's something to watch, they'll watch it and if there isn't they'll find something else to do.

So, the American public is really unlikely to care (or notice) enough to hold anyone accountable.

The people whose living is made in the ancillary areas of the entertainment industry and are directly financially affected will have an opinion, but the general viewing public won't.

This isn't like the illegal NYC transit strike where the union held the entire city hostage for several days. People in general are a lot less likely to care.


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## DevdogAZ (Apr 16, 2003)

busyba said:


> So, the American public is really unlikely to care (or notice) enough to hold anyone accountable.


I'm simply pointing out that, as with nearly everything else, public opinion on this will be split. Some will blame the WGA, some will blame the producers, some will blame the networks and Hollywood in general. No matter what, any action taken by the public will be adverse to all parties involved, so nothing good will come out of this. Even if only 10% of the public gives a damn and does something about it, 5% of those are going to stop watching because they think the writers don't deserve anything, and 5% of those are going to stop watching because they don't want to support the studios/networks. Regardless of which side they're trying to harm, the result is that 10% have still stopped watching altogether, which harms everyone involved.


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## latrobe7 (May 1, 2005)

DevdogAZ said:


> Regardless of which side they're trying to harm, the result is that 10% have still stopped watching altogether, which harms everyone involved.


Yes, but it will hurt the media corporations less. With so many conglomerates these days, the studios have several revenue streams. They are in a much better position than the writers to wait this out.


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> I keep repeating, this is not about making *more *money. This is about protecting the residuals that they already have. In the case of the internet residuals (which is what they're really worried about) they're concerned that they're only paid 0.3% vs. the 2.5% on television broadcasts. They are right to think that internet or future delivery methods that will be classified as internet will lessen the amounts received from broadcasts and eventually usurp it all together. .


That doesn't even pass the laugh test. OF course they want more money. You said it yourself in another post. They gave us that 80% and now they want it back. Their argument is that getting that protects them on the internet front from the money they may lose on the DVD front. Which is silly. In 1988, Video sales of TV didn't even exist. The ONLY post network airing of TV shows was in syndication. All the DVD sales are effectively FOUND money. Money they were not getting before.

According to your earlier post.



Vito the TiVo said:


> Currently:
> Television broadcast = 2.5% residual
> DVD/Video = they struck for video residuals in 1988 had to settle because "video was new" with the understanding that it would go up when profitable = 0.3% residual up to $1 million gross; 0.36% above that
> Internet (paid - itunes, etc) = 0.3% residual up to $1 million gross; 0.36% above that
> ...


I see that as regaining the "lost" DVD money
Adding the "free" internet money. ( and no, it's not clear what the monitization mechanism is there, most likely ads but who gets that? Producers, Network?)

In either case, they want MORE of something. I think DVD sales will increase making them more money as back catalogs get sold.

If they want to monitize the internet, go ahead. The real issue is that a new way to make money has evolved since the last contract and they see that as a place to got for more money. There's nothing wrong with that but to say they are trying to not lose money is just silly even using your own numbers.


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## Vito the TiVo (Oct 27, 2003)

I'm done here. I just don't have the energy to argue to with a handful of people that have their views and won't even examine the issue from another angle. I would just recommend to everyone that they keep in mind that people's livelihoods are at stake, above and below the line.


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## marksman (Mar 4, 2002)

It is an interesting dynamic that controls Hollywood. If the Writer's Guild was in a vacuum I am pretty sure the producers would just break them and hire non-union writers. The only thing that protects the writers is the reaction this would have from Actors and Directors who the producers really would be afraid to lose, as they are the real identifiable commodities that sell their products. 

I think if they knew there would be no response from the other unions, they would start hiring non-union writers tomorrow, and even allow a new union to be formed under a much cheaper agreement.


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## tiams (Apr 19, 2004)

Anything that stands in the way of me seeing 16 episodes in a row of the new season of Lost is a BAD THING!!! 
I also feel sorry for all the people who have other jobs in TV (camera operators, post-production people, stage hands, etc.) and are now out of work.


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> I'm done here. I just don't have the energy to argue to with a handful of people that have their views and won't even examine the issue from another angle. I would just recommend to everyone that they keep in mind that people's livelihoods are at stake, above and below the line.


All that means is that more people disagree with you than agree. I listened to your point of view and discussed your points where was there an error?

I can understand if we disagree but I don't think you accurately rebutted the points brought up. I'm all for people earning a fair days pay. What I'm not clear on is when it suddenly became unfair. The rates aren't fixed in amount, they are percentages. If the sales or distribution prices go up, so do they residuals. Where did the writer's just screwed between Oct 31 and Nov 1st?


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## IJustLikeTivo (Oct 3, 2001)

tiams said:


> Anything that stands in the way of me seeing 16 episodes in a row of the new season of Lost is a BAD THING!!!
> I also feel sorry for all the people who have other jobs in TV (camera operators, post-production people, stage hands, etc.) and are now out of work.


Are all the non -writers who are now out of work, above or below Vito's line?


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## Kablemodem (May 26, 2001)

They are below the line. Most people above the line make a pretty good living.


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## dswallow (Dec 3, 2000)

I'd like to see a real financial example of these residuals making a difference.


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## Vito the TiVo (Oct 27, 2003)

IJustLikeTivo said:


> All that means is that more people disagree with you than agree.


When I said handful, I mostly meant you. It seems that most others are questioning the situation or are curious and not outwardly critical of the writers being paid these residuals.



IJustLikeTivo said:


> I listened to your point of view and discussed your points where was there an error?


You pick and choose parts of my posts to deal with and we're going in circles.



IJustLikeTivo said:


> I can understand if we disagree but I don't think you accurately rebutted the points brought up.


On the contrary, I believe i rebutted _your _points. My points aren't in contention, they are the actual rates that exist, that are being requested and are being stonewalled with. Your rebuttals deal with whether you think writers should be compensated in this way (residuals, profit sharing, as a union), when that is not even a debated point in this strike.



IJustLikeTivo said:


> I'm all for people earning a fair days pay. What I'm not clear on is when it suddenly became unfair. The rates aren't fixed in amount, they are percentages. If the sales or distribution prices go up, so do they residuals. Where did the writer's just screwed between Oct 31 and Nov 1st?


It became unfair during the last contract negotiation and this one, with sales on iTunes beginning in 2005, the creation of "webisodes" and this season with the cannibalization of broadcasts by free online content (which still makes profit).

The writers get 2.5% on TV, which is going to continue to shrink and they make 0.3% on video (badly negotiated temporarily in 1988 on VHS tapes) and nothing on streaming internet, which will continue to grow. In the near future, the writers (and actors and directors and below the line in the form of benefits) will lose all this deferred payment (2.5% reduced to 0.3% or nothing). That's where they got screwed since the last contract negotiation. It's November 1st because its the expiration of the contract, allowing them to negotiate their rates. It's the AMPTP that refused to negotiate, not the writers.

The "more" money was in the form of the DVD residuals which they tried to increase to correct for the "temporary" rate set in 1988. They voluntarily took this off the table to continue to negotiate with the AMPTP on the "internet" issues raised above. They stonewalled and offered nothing.

Go on, have the last word. I truly believe that nothing I'm saying is up for debate, as I'm stating facts, not opinions. I'm just here trying to inform the public about the situation, because I don't understand how anyone can support the corporations in this (that's an opinion), even someone like me that is soon going to be staring at an empty checking account.


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## alyssa (Dec 7, 2003)

the rich get richer & the middle class gets poorer

Vito- thanks for your writings from the trenches-
I left the stage hand business 10 years ago, never belonged to IATSE but supported myself for 15 years via free lance stage work. It's a hard life-It looks all glam & parties until your working multiple 16 hour days. 
Best of luck

eta; slightly off topic, it seems as tho Local One IATSE is havening some issues too. The link is dated Oct 18th. The local has strike authorization & is posting updates. The last update is dated 5:30pm today. It's be interesting if Broadway gets shut down too.
http://www.iatselocalone.org/news/press83.html
http://www.iatselocalone.org/news/press85.html


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## jhausmann (Aug 21, 2002)

The thing I don't understand is, if the last set of contract negotiations was so bad, why did the rank and file ratify it? All the union did, and by default it's members, was delay the strike a couple of years.

As to why some Americans don't care about the writer's strike it is simple, entertainment is a nice to have not a must have. So I don't get to watch the full season of "2 and Half Men" (or any of the shows I watch) as I normally would, <shrug>. They will eventually return. Nurses go on strike and health care suffers, that's a big deal. Supermarket workers go on strike and the food supply suffers. That's a big deal. Network television writers strike and I dont get to watch my favorite shows, for a while. No big deal. Espcially with Cable and internet gaming.

When Baseball players went on strike in 1994, I ceased any and all involvement (havent been to, or watched [including the World Series] a game in 13 years. The only thing that brought baseball back from the brink, after the strike, was the huge amount of homeruns, juiced balls and or steroids? who knows or cares?). After Hockey was locked out in 2004/5, I decided the same thing. There's always something else to fill a void.

If both sides aren't careful in this strike, you might find any concessions gained to be a Phyrric victory. Increased percentages on lower revenue (advertisers will make out, the longer a strike is on because they will, initially, have to pay less to sell their product) equals less income.

IMO, the writers union waited too long to try a power play.


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## Tangent (Feb 25, 2005)

The writers want a raise and if the cameramen, gaffers, caterers, editors, etc don't get paid for as long as it takes for them to get what they want, too bad. How is _that_ fair?

I'm betting that in the end nobody will win. If you work in the industry but aren't a writer you're screwed no matter what, you just better have enough money saved to weather the strike. If you _are_ a writer but aren't a very successful one that already makes alot of money, the extra residuals in the long run will probably barely make up for the lost pay while you don't work.

So far all the strike has done is lost jobs for everyone that was going to be involved in making Heroes: Origins. ( http://www.zap2it.com/tv/news/zap-nbcshelvesheroesorigins,0,2319525.story ) Something tells me that this will not be the only cancelled show that's probably going to be replaced with more reality TV that can't be all too profitable for writers. I'm betting that alot of existing shows that are on the brink will lose viewers during any unplanned hiatus and will get yanked due to their lower ratings as well. I believe situations like this are often referred to as "shooting yourself in the foot".


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## TIVOSciolist (Oct 13, 2003)

Vito the TiVo said:


> An excellent explanation of what the WGA is striking for:


Vito:

Thanks for your comments about the strike and for starting these threads. I've been following the events pretty closely and really appreciate your insider viewpoints.


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## DevdogAZ (Apr 16, 2003)

jhausmann said:


> When Baseball players went on strike in 1994, I ceased any and all involvement (havent been to, or watched [including the World Series] a game in 13 years.


This is exactly what I was talking about earlier. It doesn't matter whose fault it is or who is right. There will always be people like this who think they're making a point by boycotting the industry that struck, and therefore the strike damages both sides, but usually the striking side suffers more.


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## smak (Feb 11, 2000)

IJustLikeTivo said:


> That doesn't even pass the laugh test. OF course they want more money. You said it yourself in another post. They gave us that 80% and now they want it back. Their argument is that getting that protects them on the internet front from the money they may lose on the DVD front. Which is silly. In 1988, Video sales of TV didn't even exist. The ONLY post network airing of TV shows was in syndication. All the DVD sales are effectively FOUND money. Money they were not getting before.


In 1988 DVD sales of TV didn't exist, and in 2028 DVD sales of TV might not exist.

All you hear about is DVD's going to be dead, it's all going to be over the internet, and you don't expect people who make money off DVD sales to negotiate to receive money on the next generation of distribution?

It would be like saying that their contract states that they receive x residuals on DVD, but doesn't specify HD-DVD so they shouldn't make money on that?

Meanwhile, the studios don't care how they sell it, they still make the same money, and probably more without having to manufacture DVD's and packaging in the future.

The same sort of thing happened with the Seinfeld DVD's. They wanted the 3 other actors to do commentary and interviews on the DVD sets, without making any money on the sales.

So at least 2 of them said no, we won't participate. I'm sure that Seinfeld etc...could have said screw you, but guess what, they decided what's fair is fair, and paid them part of the profit.

And i'm sure just like now, lots of people were calling them greedy, they made millions from Seinfeld etc... But guess what, Seinfeld & David made hundreds of millions. Castle Rock made hundreds of millions.

Their contract is up. They have a right to try to negotiate payments for the system that might eventually replace DVD.

-smak-


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> When I said handful, I mostly meant you. It seems that most others are questioning the situation or are curious and not outwardly critical of the writers being paid these residuals.


I think you don't understand my position. I have no issue with residuals. It's a method of compensation, fairly agreed to by all parties. I do have an issue with a profit participation which is what I thought they wanted. You showed me how that was not correct. THe general public however, I think, still thinks they want something else

The issue of on what they get residuals is something that is up for grabs. Things exist now that were not in play when they last negotiated the contract and it's fair for them to ask for anything they want, but at the end of the day, the other side with counter with the very least they can get. That's just how business works.



Vito the TiVo said:


> You pick and choose parts of my posts to deal with and we're going in circles.


I'm sorry if you think I pick and choose, I think mostly I respond to all parts of your post. It is the nature of debate to present things which support your postiion, is it not? To be fair, you have done the same.



Vito the TiVo said:


> On the contrary, I believe i rebutted _your _points. My points aren't in contention, they are the actual rates that exist, that are being requested and are being stonewalled with. Your rebuttals deal with whether you think writers should be compensated in this way (residuals, profit sharing, as a union), when that is not even a debated point in this strike.


I don't think I ever said that residuals were unfair. It's a valid method of compensation. I don't personally agree with that method since I do think the risks are all on the other side but the two sides agreed to that method and that's their business. You did provide me with valuable insights into the overall picture and I thank you for that.



Vito the TiVo said:


> It became unfair during the last contract negotiation and this one, with sales on iTunes beginning in 2005, the creation of "webisodes" and this season with the cannibalization of broadcasts by free online content (which still makes profit).


And certainly, they have a right to ask for redress. The times have changed and just as books on tape and streaming digital required changes to compensation for authors, this may require change.



Vito the TiVo said:


> The writers get 2.5% on TV, which is going to continue to shrink and they make 0.3% on video (badly negotiated temporarily in 1988 on VHS tapes) and nothing on streaming internet, which will continue to grow. In the near future, the writers (and actors and directors and below the line in the form of benefits) will lose all this deferred payment (2.5% reduced to 0.3% or nothing). That's where they got screwed since the last contract negotiation.


Badly negotiated isn't the same thing as unfair. As I posted, I get paid 30 K less than a less experienced colleague due to his ability to exploit the shortage in the labor market. Is that unfair, no, does it make me angry, sure. The writer's certainly have a right to try and change the bargain. No, I don't think we will agree that residuals make sense, I don't think they do. But a willing agreement between two parties fairly negotiated is their business.



Vito the TiVo said:


> It's November 1st because its the expiration of the contract, allowing them to negotiate their rates. It's the AMPTP that refused to negotiate, not the writers.
> 
> The "more" money was in the form of the DVD residuals which they tried to increase to correct for the "temporary" rate set in 1988. They voluntarily took this off the table to continue to negotiate with the AMPTP on the "internet" issues raised above. They stonewalled and offered nothing.


I do think it's reprehensible for the AMPTP to not negotiate. But they think the writer's will back down. Maybe they're right. They think since they WGA backed down on Video sales last time they'll back down this time. I think that's a crappy way to do business but they get to choose , not me.



Vito the TiVo said:


> Go on, have the last word. I truly believe that nothing I'm saying is up for debate, as I'm stating facts, not opinions. I'm just here trying to inform the public about the situation, because I don't understand how anyone can support the corporations in this (that's an opinion), even someone like me that is soon going to be staring at an empty checking account.


My issue isn't with your rights to negotiate, you have that right but strikes hurt everyone and are an awful tactic in my book. You aer tyring to get something the WGA wants by hurting many many more people. The WGA respresents a tiny fraction of the people who are now out of work. The security guards, grips, gaffers, riggers, camera crew, caterers, lighting designed, set decoration , production staff etc are all out of work. They get nothing in their paycheck while this happens too. Their numbers are much larger than yours. Did they do something wrong in the negotiations? No, they are just collateral damage in a war between the WGA and the AMPTP.

I don't relish in your soon to be empty account, I want everyone to make a fair wage but the collateral damage here is just too great for me to be on your side. I'm sorry, I know you want us all to support you and I think you have some legitimate grievances but you're hurting too many innocents.

Good luck, I hope you get back to work soon for everyone sakes.


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## Vito the TiVo (Oct 27, 2003)

IJustLikeTivo said:


> I'm sorry, I know you want us all to support you and I think you have some legitimate grievances but you're hurting too many innocents.
> 
> Good luck, I hope you get back to work soon for everyone sakes.


I thank you for your comments and I think that I can end here, but I just want to make clear before I go that I am not a paid writer, nor the member of the WGA (or any other labor union for that matter). I work on a primetime network series as an assistant to the line producer and I will be out of work as soon as the material runs out. I *am *one of the "innocents".

Perhaps I am too political, but I still support the writers in this situation, no matter what the personal impact is for me.


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## speedcouch (Oct 23, 2003)

dswallow said:


> Id' fully support a writers strike if it shut down production of, and only of, every reality show.


Here, here! :up:

Cheryl


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## Vito the TiVo (Oct 27, 2003)

I'll keep checking into this thread to answer specific questions, but I'll let the debate rage without me. I think I've done a decent job with what I intended to do with the thread and explain to people outside the industry what the situation is and why it matters so much to those on strike. 

I would actually love it if someone that fully supports and is "in the know" on the AMPTP side can present arguments why they are stonewalling so hard beside the party line of "corporations lose too much money, so we can't give any one residuals"


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## IJustLikeTivo (Oct 3, 2001)

Vito the TiVo said:


> I thank you for your comments and I think that I can end here, but I just want to make clear before I go that I am not a paid writer, nor the member of the WGA (or any other labor union for that matter). I work on a primetime network series as an assistant to the line producer and I will be out of work as soon as the material runs out. I *am *one of the "innocents".
> 
> Perhaps I am too political, but I still support the writers in this situation, no matter what the personal impact is for me.


Passion is not political. You feel strongly about this, you have nothing to explain. Unlike politicians, we can be on opposite sides of a discussion without being enemies.

I hope for your sake and that of the others who are "collateral" damage, that this gets solved soon.

Best of luck.


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## jhausmann (Aug 21, 2002)

DevdogAZ said:


> This is exactly what I was talking about earlier. It doesn't matter whose fault it is or who is right. There will always be people like this who think they're making a point by boycotting the industry that struck, and therefore the strike damages both sides, but usually the striking side suffers more.


Not doing it to make a point. In both cases I simply found something to replace the sport, after going roughly a year without either sport. I've found that I simply dont miss the sport enough to return to it.


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## alyssa (Dec 7, 2003)

According to the NewYorkTimes, IATSE, the Stage Hand union is due to walk out on strike just after the Matinee today. This means a greatly reduced # of Broadway shows.

http://www.nytimes.com/2007/11/10/theater/10broadway.html?ref=arts


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## DevdogAZ (Apr 16, 2003)

alyssa said:


> According to the NewYorkTimes, IATSE, the Stage Hand union is due to walk out on strike just after the Matinee today. This means a greatly reduced # of Broadway shows.
> 
> http://www.nytimes.com/2007/11/10/theater/10broadway.html?ref=arts


That sucks for people who have purchased tix and paid for trips to NY to see shows. That's a much more pressing and immediate impact than the writer's strike.


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## alyssa (Dec 7, 2003)

The Theatres are refunding the Tix


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## Langree (Apr 29, 2004)

The longer these strikes and walkouts go on, I would think it has the possibility to affect many other people adversely, even after it's over.

If the network decides it's not worth it for a project to go back into production, people who were working when this started now find themselves out of a job. 

The heat will be felt on both sides at some point. 

My hope is the writer's can hold out long enough to get a fair shake, although I think they will feel the squeeze first, add pressure from all the other support crew and actors not getting paid for an extended period and there will be a lot of pressure just to end this thing.

IIRC the last time this happened the summer movie season sucked ass following the strike, I'm not looking forward to a repeat.


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## Kamakzie (Jan 8, 2004)

Any hope this thing will be settled in a timely manner?


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## busyba (Feb 5, 2003)

DevdogAZ said:


> That sucks for people who have purchased tix and paid for trips to NY to see shows. That's a much more pressing and immediate impact than the writer's strike.


The first broadway performance to get canceled due to the stagehands strike was an early matinée of The Grinch. If I were part of the producers group I would be sure to get down there and get a picture of the strikers and a crying kid.

You can't buy that kind of PR.


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## hefe (Dec 5, 2000)

LoadStar said:


> The most interesting thing about all of this, in my opinion, is the unexpected place of one of the 'flashpoints' that led to the strike... Sci-Fi's "Battlestar Galactica."
> 
> Fans of the series probably recall the "webisode" miniseries Battlestar Galactica: The Resistance. Despite being written and filmed precisely as a TV episode would have been, and attracting significant viewers online, NBC Universal deemed the episodes "promotional materials" rather than original creative content, and therefore nothing needed to be paid to the writers for them.
> 
> It's interesting that a show like Battlestar Galactica that is commonly overlooked, is actually changing Hollywood.


How ironic (or was it intentional) that Steve Carrell's character in The Office, another prominent show that did "webisodes," was wearing a Battlestar Galactica T-shirt in this week's episode.


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## Rob Helmerichs (Oct 17, 2000)

Kamakzie said:


> Any hope this thing will be settled in a timely manner?


Not really. The studios refuse to give an inch, their usual MO. The writers are unified like never before--both the number of people voting and the margin of Yes votes were astonishing. The writers have been bending over since the last strike, and the studios are so used to that, it's going to take them a while to realize the writers are really serious this time and the studios will have to actually negotiate for once instead of putting out an insulting offer and waiting for the writers to cave.


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## IJustLikeTivo (Oct 3, 2001)

Langree said:


> The longer these strikes and walkouts go on, I would think it has the possibility to affect many other people adversely, even after it's over.


The problem this time is that there are so many other choices. I think the networks have a real problem. If the audience really understands they no longer need the networks, the network will lose not the audience. Now we have 200 other channels plus the very internet the writer's are striking about. Networks are dying they just don't know it yet, this may move it along



Langree said:


> If the network decides it's not worth it for a project to go back into production, people who were working when this started now find themselves out of a job.


That has already happened. At least one show, Big Shots, that was marginal has announced that they will not go back into production, ever.


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## smak (Feb 11, 2000)

alyssa said:


> According to the NewYorkTimes, IATSE, the Stage Hand union is due to walk out on strike just after the Matinee today. This means a greatly reduced # of Broadway shows.
> 
> http://www.nytimes.com/2007/11/10/theater/10broadway.html?ref=arts


I wonder if those greedy stage hands realize that the actors & directors who work on those shows are innocent bystanders in all this.

How come they never think of anybody but themselves?

-smak-


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## steve614 (May 1, 2006)

IJustLikeTivo said:


> At least one show, Big Shots, that was marginal has announced that they will not go back into production, ever.


The local news here reported this might happen to K-Ville as well.


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## IJustLikeTivo (Oct 3, 2001)

Here is an in*eres*ing coun*erpoin*. In*eres*ing poin* abou* how when *he shows s*ar* showing reruns, *he wri*ers will ge* residuals while everyone else is s*ill ge**ing no*hing.

h**p://la*imesblogs.la*imes.com/show*racker/2007/11/i-was-un*il-rec.h*ml


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## scottjf8 (Nov 11, 2001)

IJustLikeTivo said:


> Here is an in*eres*ing coun*erpoin*. In*eres*ing poin* abou* how when *he shows s*ar* showing reruns, *he wri*ers will ge* residuals while everyone else is s*ill ge**ing no*hing.
> 
> h**p://la*imesblogs.la*imes.com/show*racker/2007/11/i-was-un*il-rec.h*ml


huh?


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## trojanrabbit (Mar 10, 2001)

The letter "t" is on strike.


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## IJustLikeTivo (Oct 3, 2001)

scottjf8 said:


> huh?


Sorry, the forum was acting up for a bit.

Here is the link.

http://latimesblogs.latimes.com/showtracker/2007/11/i-was-until-rec.html


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## alyssa (Dec 7, 2003)

An excellent article by Mark Harris

http://www.ew.com/ew/article/0,,20159387,00.html

an excerpt;


Mark Harris said:


> Let's look at residuals first. Currently, for every dollar spent on a DVD, writers receive about one-third of a penny. They would like, instead, to receive about two-thirds of a penny. The AMPTP's first response to this was to waste weeks by advocating a complete abolition of the residual system. Why, they argued, should writers get paid anything for their work after it's released? Studio chiefs who are smart enough to know better even hauled out a tired old maxim attributed to the late MCA titan Lew Wasserman - ''My plumber doesn't charge me every time I flush the toilet'' - and repeated it in perfect Karl Rove everybody-stay-on-message lockstep.
> Ugh. Lines like that give you a taste of what the entertainment world will be like if management ends up doing its own writing. Not to belabor an already disgusting analogy, but writers - and directors and actors, who have their own renegotiations coming up - aren't the plumber: They're the water. Without them, nothing goes anywhere, and you end up with a toilet full of...well, let's just say ''reruns.''
> In making this why-should-we-keep-paying argument, the AMPTP blithely ignored a century of copyright law that grants creative writers in every other field - novelists, composers, lyricists, playwrights - ongoing income from their work based on its sales. <snip>
> If you run a company that produces written entertainment, you either believe that writers have value, or you don't. If you do, the only decent thing to do is to recognize the legitimacy of paying writers a percentage - yes, a whole two-thirds of a penny - as long as the companies that own their work continue to derive income from it. What's not decent is to have spent valuable negotiating time floating a specious theory of big-picture bullcrap about how the residual system is ''antiquated'' without offering any alternative compensation in its place. (Since the producers abruptly dropped this idea, one has to wonder if it was ever raised as anything other than a thuggish scare/stalling tactic in the first place.)


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## dswallow (Dec 3, 2000)

alyssa said:


> An excellent article by Mark Harris
> 
> http://www.ew.com/ew/article/0,,20159387,00.html
> 
> ...


Writers are free to negotiate other terms. Writers are free to work freelance, too. As hired employees it shouldn't be mandated that the company pays a residual. That should be something the company offers as an incentive, perhaps. And writers with a good track record certainly would demand proper compensation as their talents would be in demand if they really were out of the ordinary. But mandatory? No.


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## Fassade (Apr 8, 2004)

dswallow said:


> Writers are free to negotiate other terms. Writers are free to work freelance, too. As hired employees it shouldn't be mandated that the company pays a residual. That should be something the company offers as an incentive, perhaps. And writers with a good track record certainly would demand proper compensation as their talents would be in demand if they really were out of the ordinary. But mandatory? No.


This argument presumes that residuals are only a bonus on top of normal pay, when residuals have always been a hedge for the studios as much as an incentive for the writers. (Warning: Fake numbers to follow).

Let us say a writer demands $10,000 for a particular piece of work. The studio would rather pay $5,000, not because they are cheap, but because the studio simply knows that the vast majority of projects fail, either by losing money, or by not making it to the production phase at all. They also know that they need to obtain (and pay) quality talent on these shows to have a chance of success, but they cannot afford $10,000 per writer in the face of such a dismal success rate.

The residual system serves in part to offload some of that risk from the studio to the creative talents. Under a residual system, the studio can offer that writer $5,000, with the promise of 2% of profits past a certain point. That way, if the show is another failure, both sides share the pain -- the studio loses its investment, and the writer receives less money. If the show is a success, both the studio and the writers benefit. It is hard to argue either case is inappropriate.


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## dswallow (Dec 3, 2000)

Fassade said:


> This argument presumes that residuals are only a bonus on top of normal pay, when residuals have always been a hedge for the studios as much as an incentive for the writers. (Warning: Fake numbers to follow).
> 
> Let us say a writer demands $10,000 for a particular piece of work. The studio would rather pay $5,000, not because they are cheap, but because the studio simply knows that the vast majority of projects fail, either by losing money, or by not making it to the production phase at all. They also know that they need to obtain (and pay) quality talent on these shows to have a chance of success, but they cannot afford $10,000 per writer in the face of such a dismal success rate.
> 
> The residual system serves in part to offload some of that risk from the studio to the creative talents. Under a residual system, the studio can offer that writer $5,000, with the promise of 2% of profits past a certain point. That way, if the show is another failure, both sides share the pain -- the studio loses its investment, and the writer receives less money. If the show is a success, both the studio and the writers benefit. It is hard to argue either case is inappropriate.


Even with fake numbers, the cost of writers to a show pales by comparison to the cost of actors. 

But that's fine... the studio and the writer should be free to negotiate such terms, not have a mandated minimum residual requirement.

And still I don't think we've yet had a single actual example given to us by a writer... at least by a writer who actually received residuals rather than having absurdly popular shows with DVD sales and yet not a single residual payment. In fact, based on that, I'd suspect writers would rather have the $10,000 up front than $5,000 up front and 2% of nothing later.


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## alyssa (Dec 7, 2003)

dswallow said:


> <snip> blah blah no residuals for writers


The residual system is how the writer have been compensated--it has been that was for at least 20 years now. If the AMPT wanted to change it, they should have gone to the WGA with a proposal instead of all the wasted time on all the yack yack.

Don't forget these are the people who, when asked by the wga for internet residuals said they needed to study it for Three years! What's to study, if the streaming internet thing doesn't make $ then the writers don't get money. It's Simple math.


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## Fassade (Apr 8, 2004)

dswallow said:


> Even with fake numbers, the cost of writers to a show pales by comparison to the cost of actors.


True for shows that make it to air, but when you factor in the number or shows who are paid through several rounds of development, but which do not air, the gap is not as wide as you might think. In any case, if the amount was insignificant, writers would not strike, and the studios would not begrudge the money. Since several thousand people are picketing, and several dozen shows are going to shut down at least temporarily, this is obviously not the case.


dswallow said:


> But that's fine... the studio and the writer should be free to negotiate such terms, not have a mandated minimum residual requirement.


If this was a government mandate, I would wholeheartedly agree, but it is not. It is a fight between two private parties on contract terms. If the writers obtain meaningful concessions, bully for them! If the studios do, bully for them, instead! While I probably slightly come down on the side of the writers, I do not have any vested interest in this fight. I jumped into this thread when the topic turned towards the elimination of residuals, because, as a selfish TV viewer, I think elimination of the residual system would make TV even more homogeneous than it is today. It is simple human nature...the more something costs you up front, the more likely you are to minimize your risks beforehand. If the studios have to pay everything up front, they will fund less productions, and those that get funded will all be safer, more thoroughly audience-tested fare, which I think will give me less good programming to watch.


dswallow said:


> And still I don't think we've yet had a single actual example given to us by a writer... at least by a writer who actually received residuals rather than having absurdly popular shows with DVD sales and yet not a single residual payment.


I do not think that you would get an example from a writer (or a studio, for that matter) during a negotiating period, and certainly not on a fanboard -- their negotiating teams and lawyers would eat them alive 


dswallow said:


> In fact, based on that, I'd suspect writers would rather have the $10,000 up front than $5,000 up front and 2% of nothing later.


Well, if residuals are eliminated, yes, they will all take the $10,000 up front, because there will be no other option. Since residuals exist, it is all based on risk tolerance. Put in more simple terms, if you were offered the choice of a guaranteed $50,000 1-year contract today, or a $25,000 1-year contract today with a 1% chance of $750,000+ if your work was well received, which would you pick? Some would take $50,000, and others would take the $25,000 and work twice as hard polishing their dialogue and sharpening their jokes to increase their chances of becoming the next Les Charles or Larry David.

IMHO, Residuals gives those writers an economic incentive to take their shot, and it gives studios some small extra economic incentive to take a chance on them. Writing is not a science, of course, but I think good shows have more of a chance to bubble up through the Hollywood filter when there are 10 hungry writing teams developing ideas than 5 teams with guaranteed paychecks.


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## dswallow (Dec 3, 2000)

Fassade said:


> IMHO, Residuals gives those writers an economic incentive to take their shot, and it gives studios some small extra economic incentive to take a chance on them. Writing is not a science, of course, but I think good shows have more of a chance to bubble up through the Hollywood filter when there are 10 hungry writing teams developing ideas than 5 teams with guaranteed paychecks.


If the argument has merit, it makes sense from the studios perspective as well; it becomes a way to attract talent... people with a vested interest in the success of something often are much more highly motivated to pursue that success. And that's where the free market should be left... if it really does make a difference.

These residuals have been this way for over 20 years. Guess what? They're not resulting in a particularly high quality of output now. Maybe the industry needs to try paying a normal, living wage without empty promises of future wealth to get writers who can actually write quality stuff instead of fortune hunters who sometimes can write OK.

And for those really good writers who bubble up out of the muck and become sought after by the studios -- they'll be able to command better pay and percentages because their services will be in demand.


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## dswallow (Dec 3, 2000)

Fassade said:


> I do not think that you would get an example from a writer (or a studio, for that matter) during a negotiating period, and certainly not on a fanboard -- their negotiating teams and lawyers would eat them alive


I think we'd have at least seen a realistic example somewhere from someone.

Most likely, either the amounts involved are embarrassingly high, or embarrassingly low.


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## mrmike (May 2, 2001)

dswallow said:


> These residuals have been this way for over 20 years. Guess what? They're not resulting in a particularly high quality of output now.


And you assume this is the fault of the writers? I find it just as likely that the ones who actually decide what gets broadcast aren't as interested in quality writing as they are in shows that "test well" or serve to the LCD who still watch reality TV. Given the number of "good treatment becomes weak screenplay becomes horrible movie due to the hamhanded attempts of studios/producers to "tune it"" stories you hear in the business, I actually find that more likely.



dswallow said:


> I think we'd have at least seen a realistic example somewhere from someone.
> 
> Most likely, either the amounts involved are embarrassingly high, or embarrassingly low.


How hard is it to multiply 3-5 cents per copy times some sales figures?


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## Fassade (Apr 8, 2004)

dswallow said:


> If the argument has merit, it makes sense from the studios perspective as well; it becomes a way to attract talent... people with a vested interest in the success of something often are much more highly motivated to pursue that success. And that's where the free market should be left... if it really does make a difference.


No argument here, and I do not see the free market being violated here in spirit or in letter. Regardless of original design, the residual system does work for both; studios use it as a hedge against costs of failures, and writers use residuals as an incentive. Even those hardcore union types who felt they were screwed on residuals by the last contract honored that contract until it was up, and now they are using their once-every-20-years point of leverage to try and win a better deal. All of it legal, proper, and self-interested -- on both sides.


dswallow said:


> These residuals have been this way for over 20 years. Guess what? They're not resulting in a particularly high quality of output now.


Residuals have been in place longer than that, but, even so, you may be right; it is impossible for anybody to tell. However, there are two undeniable facts in Hollywood: studio budgets are not infinite, and most shows fail or die stillborn. Therefore, if studios eliminate residuals and have to pay more per show up front, they need to increase their overall success rate to stay in business. Their only rational response would be to develop less and/or safer shows -- so my hypothesis is that the total elimination of residuals would mean more Full House, less Arrested Development.


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## Rob Helmerichs (Oct 17, 2000)

mrmike said:


> How hard is it to multiply 3-5 cents per copy times some sales figures?


...after the sales figures have been reduced by factoring in bogus "expenses"...


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## JMikeD (Jun 10, 2002)

Rob Helmerichs said:


> ...after the sales figures have been reduced by factoring in bogus "expenses"...


J. Michael Straczynski, who wrote most of the Babylon 5 episodes in addition to creating the series, has stated several times that he has never seen a penny from the B5 DVD sales, despite Warner's claim to have sold 500 million dollars (yes, half a billion dollars) worth of the DVDs (no, I don't know where that number came from, but I tend to trust JMS). Creative accounting being what it is, he says he never expects to see any money from it.

Here's one of his comments on residuals:

"Actors and writers get residuals each time an episode is aired. The
amount of that residual is not based on the ratings, so any actor
can't tell how it's doing based on that.

There are three different formulas used to compute ratings, one for
network, another for syndication, a third (and the crummiest) for
cable. Crummiest in that the amount of the residual is tied to the
amount paid for the rights to show the series. Consequently, many of
the studios that own cable networks (as Universal owns USA Network,
for instance) sell the shows to themselves for the smallest amount
possible.

Hence, a residual that, for a third or fourth airing, might bring a
couple thousand bucks elsewhere, in that situation brings you
literally about five dollars.

This is one of the issues being addressed in the current pre-strike
negotiations. "


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## IJustLikeTivo (Oct 3, 2001)

alyssa said:


> The residual system is how the writer have been compensated--it has been that was for at least 20 years now. If the AMPT wanted to change it, they should have gone to the WGA with a proposal instead of all the wasted time on all the yack yack.
> 
> Don't forget these are the people who, when asked by the wga for internet residuals said they needed to study it for Three years! What's to study, if the streaming internet thing doesn't make $ then the writers don't get money. It's Simple math.


Not so fast. Figuring out internet revenue is anything but clear. If you assume the distribution is not via itunes but is instead done via a real time viewing portal like go.abc.com or cbs.com or whatever the new stupid name NBC has, the revenue for that comes not directly but via a variety of ad revenue. If you come to the portal to see three shows and see ads for a bunch of stuff, how do you split that revenue. With a direct sale or rental, you can apportion the revenue directly based on what specifically was watched. But with ad supported sites, the division of revenue is much muddier. Additionally, the bookkeeping involved with which production gets how much revenue is much more complicated than in direct sales where it's pretty clear where the money goes. Additionally, since they have no idea how much revenue their might be relatives to production costs and how the scale will affect the picture, it's hard to negotiate when the cost sides are not known. Sure, they need to do it, but it's not going to be an easy debit/credit scenario to figure out.


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## IJustLikeTivo (Oct 3, 2001)

Rob Helmerichs said:


> ...after the sales figures have been reduced by factoring in bogus "expenses"...


Expenses and bonuses are a legitimate cost of doing business and should be factored into the actually cost of doing business. One problem with the residual system is the allocation of overhead cost to the profit picture which has to be done in order to do net percentage distribution. Also, if the show is in negative profit, do the writer's owe money?


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## IJustLikeTivo (Oct 3, 2001)

JMikeD said:


> This is one of the issues being addressed in the current pre-strike
> negotiations. "


Hollywood accounting has been a problem for much longer than this. United Artist was started by Mary Pickford and Douglass Fairbanks partially since they felt the accounting practices of the studios were cheating them out of money.

BTW, Nice Avatar.


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## IJustLikeTivo (Oct 3, 2001)

JMikeD said:


> This is one of the issues being addressed in the current pre-strike
> negotiations. "


Hollywood accounting has been a problem for much longer than this. United Artist was started by Mary Pickford and Douglass Fairbanks partially since they felt the accounting practices of the studios were cheating them out of money.

BTW, Nice Avatar. I can't quite tell what it is but it looks like a Velocity.


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> Not so fast. Figuring out internet revenue is anything but clear. If you assume the distribution is not via itunes but is instead done via a real time viewing portal like go.abc.com or cbs.com or whatever the new stupid name NBC has, the revenue for that comes not directly but via a variety of ad revenue. If you come to the portal to see three shows and see ads for a bunch of stuff, how do you split that revenue. With a direct sale or rental, you can apportion the revenue directly based on what specifically was watched. But with ad supported sites, the division of revenue is much muddier. Additionally, the bookkeeping involved with which production gets how much revenue is much more complicated than in direct sales where it's pretty clear where the money goes. Additionally, since they have no idea how much revenue their might be relatives to production costs and how the scale will affect the picture, it's hard to negotiate when the cost sides are not known. Sure, they need to do it, but it's not going to be an easy debit/credit scenario to figure out.


All true, but your next few posts should explain the writers/directors/actors deep skepticism when it comes to studios figuring out these scenarios. If a picture loses money, the studios do not owe writers (or any net participant) money -- that is the entire point of residuals as a risk hedge, and that, in theory, is fair. The problem in practice is that the studio, people with a vested interest in one type of outcome, performs all calculations. As you point out, this has led to the practice -- or at least, the perception -- of studios cooking the books at the expense of net participants (virtually all aboveboard talent) going back at least 88 years and the foundation of United Artists.

Probably the most famous recent example would be Forrest Gump, where the novel's author and film's screenwriter sued to receive royalties, after Paramount claimed the (at the time) $661 million grossing film had yet to turn a profit, and in fact had lost over $60 million. (Apologies for this 
old citation, but most news sources have long since archived the article.) Similar entanglements have arisen for projects as diverse as Coming to America, My Big Fat Greek Wedding, and Bablyon 5.

I do not know what the solution would be -- after all, if the studios and talent had to cooperatively perform accounting on each picture, nobody but their respective accountants and lawyers would make any extra money -- but, given nearly a century of this history, it should easily be understandable why the various Hollywood unions are unwilling to cut the studio much slack in figuring out new scenarios.


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## alyssa (Dec 7, 2003)

IJustLikeTivo said:


> Not so fast. Figuring out internet revenue is anything but clear. <snip>


And the AMPTP is saying it needs 3 years to figure out how to do the accounting.
Thanks for illustrating my point.



Ijustliketivo said:


> Additionally, the bookkeeping involved with which production gets how much revenue is much more complicated than in direct sales where it's pretty clear where the money goes. Additionally, since they have no idea how much revenue their might be relatives to production costs and how the scale will affect the picture, it's hard to negotiate when the cost sides are not known. Sure, they need to do it, but it's not going to be an easy debit/credit scenario to figure out.


I agree, the accounting methodology won't be easy. I'll further make the irrational suggestion that if the AMPTP took each project in a show by show basis over the course of a fixed time period, say a month, without the "creative Hollywood bookkeeping", the tracking/math would be a *LOT* simpler.

All sarcasm aside. Of course amortizing the production costs will be necessary, but it's a finite cost. In the end it does not matter how much a show makes. If the show doesn't make money, 2.5% of zero is still zero. Yes, it will take some time to figure out the accounting methodology but not 3 years. There are plenty of other examples of residual systems to adapt.

If the AMPTP isn't careful it's industry will be in the same mess that the music business is in. I'm sure there will ways to stream shows to my tivo regardless of where the show is manufactured. I'll close with a comment from the picket line;
"This morning, I picketed with an 86 year writer, who wrote for 'Mr. Ed.' He said, 'It pisses me off that that f***ing horse wound up speaking Italian, Polish and Rumanian, and I never made more than a nickel.'"
-Peter Leftcourt


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## dswallow (Dec 3, 2000)

alyssa said:


> "This morning, I picketed with an 86 year writer, who wrote for 'Mr. Ed.' He said, 'It pisses me off that that f***ing horse wound up speaking Italian, Polish and Rumanian, and I never made more than a nickel.'"
> -Peter Leftcourt


I'll bet you he wasn't pissed off while he was working on the show, writing, and being paid for it.


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## tiams (Apr 19, 2004)

Why do television writers give up the copyrights to their work? Do book authors?
OTOH, if an artist creates a painting, he doesn't expect to be paid for every person who looks at it.


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## busyba (Feb 5, 2003)

tiams said:


> OTOH, if an artist creates a painting, he doesn't expect to be paid for every person who looks at it.


I'm pretty sure he gets paid for every reproduction made of it though.


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## alyssa (Dec 7, 2003)

dswallow said:


> I'll bet you he wasn't pissed off while he was working on the show, writing, and being paid for it.


Could be.
But then just like today, no one knows how the newfangled TV/streaming thing would/will pan out.
fool me once shame on you, fool me twice shame on me


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## JMikeD (Jun 10, 2002)

IJustLikeTivo said:


> BTW, Nice Avatar.


It's a Beechcraft Starship, designed by Burt Rutan. 53 made, 3 still flying. Beech (Raytheon) is slowly buying them all back and shredding them. Burn In Hell, Raytheon!!!!


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## IJustLikeTivo (Oct 3, 2001)

JMikeD said:


> It's a Beechcraft Starship, designed by Burt Rutan. 53 made, 3 still flying. Beech (Raytheon) is slowly buying them all back and shredding them. Burn In Hell, Raytheon!!!!


Picture was too small or I would have known. Great plane. I think Raytheon is no longer burning in hell since they sold off the plane division didn't they? Silly of me not to notice the twin engines which would be the giveaway.

One of the guys who still flies it has two and has bought all the remaining spares. The only thing close to as pretty is the Piaggio Avanti.


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## JMikeD (Jun 10, 2002)

tiams said:


> Why do television writers give up the copyrights to their work? Do book authors?


They don't. The original script is copyrighted by the author, who can publish and sell them and the studios don't get a penny of the revenue.

Joe Straczynski is doing this with the Babylon 5 scripts that he wrote, even though Warner Bros. owns Babylon 5.

Book authors don't normally give up their copyright. They sign over publishing rights for some period of time, but after that they can do whatever they wish with the material. That's my understanding, anyway.


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## JMikeD (Jun 10, 2002)

IJustLikeTivo said:


> One of the guys who still flies it has two and has bought all the remaining spares. The only thing close to as pretty is the Piaggio Avanti.


The Piaggio is pretty nice, you can actually stand up in it. D**n thing is almost impossible to land, though without a *lot* of practice. I've been using a simulator and the thing just bounces all over the place.

There are some landing and takeoff videos of both the Starship and the Avanti on Youtube.


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## IJustLikeTivo (Oct 3, 2001)

JMikeD said:


> The Piaggio is pretty nice, you can actually stand up in it. D**n thing is almost impossible to land, though without a *lot* of practice. I've been using a simulator and the thing just bounces all over the place.
> 
> There are some landing and takeoff videos of both the Starship and the Avanti on Youtube.


Yes, they're nice inside. We have one that comes in an out of my airport pretty often and I smoozed the pilot and got a look. I'm nut sure how hard it is to land but he does a nice job landing there at least.


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## mwhip (Jul 22, 2002)

Damon Lindeloff wrote a nice piece for the NY Times:

http://www.nytimes.com/2007/11/11/o...bc6bf1ebf&ei=5090&partner=rssuserland&emc=rss


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## IJustLikeTivo (Oct 3, 2001)

mwhip said:


> Damon Lindeloff wrote a nice piece for the NY Times:
> 
> http://www.nytimes.com/2007/11/11/o...bc6bf1ebf&ei=5090&partner=rssuserland&emc=rss


BTW, does the WGA have a strike fund like the UAW which pays workers something during a strike?


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## alyssa (Dec 7, 2003)

I have not read of any such fund.


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## dswallow (Dec 3, 2000)

IJustLikeTivo said:


> BTW, does the WGA have a strike fund like the UAW which pays workers something during a strike?


WGA-West has a strike fund of a little over $9 million and a "Good & Welfare" fund of $3 million. Generally they make loans with this money, though they can do grants as well.

WGA-East has a strike fund of just under $3 million.

Of course the real concern is how everyone else who's out of work because the writers are striking will fare... none of which can draw from the WGA's strike fund... www.actorsfund.com is apparently one place they can turn.


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## Fassade (Apr 8, 2004)

I have a feeling this could end very badly for the writers. This dispute was originally about different residual rates on the internet, but, within a few pages, the forum question turned to one of eliminating residuals entirely. If members of the TiVO forums, who by definition are more avid, sophisticated consumers of TV than most, think this, then obviously the writers have done a piss-poor job of making their case. I am not a writer, but I will take another crack at the residual question here:

Both writers and studios like the residual system, even though they argue over levels. As I said earlier, writers use them as an incentive, and studios use them to hedge their bets and experiment with a larger pool of writers. By design, however, residuals serve a far more important purpose to both sides. In any field, the Author (writer) has an inalienable right to all derivate works, and, without those rights, a studio cannot make any derivate works, i.e. they cannot make a movie, much less the videogame tie-in. Similarly, without funding, actors, producers, and crew, writers cannot make the movie, either. Residuals are the compromise studios and writers came up with decades ago as a way to transfer enough ownership rights to allow movies and television to get made. The answer to the oft-quoted line about "not paying residuals to my plumber when I flush my toilet" would be this -- if long-standing law required you pay the plumber before you could produce any *ahem* derivative work, you would pay that plumber, and fast 

This is why, saber rattling aisde, the studios never seriously propose taking residuals completely off the table. While every business would love to reduce costs, effect on the talent pool aside, it is simply not worth the potential legal quagmire. (Then again, entertainment is a business, and, if/when studios decide that it is worth the risk, they will try, and the writers will try just as hard to stop them, and may the most leverage win.)

So, given that the elimination of the residual system is not an option during these negotiations, the question returns again to the specific issues of the strike, namely, what those rates should be across different distribution media. They two sides will eventually compromise on numbers, but the issue, as others have pointed out, is the internet. Rates now are (I believe) as follows:

* 2.5% for broadcast
* 0.3% for DVD sales
* 0.0% for internet distribution.

It is that last number has the writers up in arms. As the NY Times and others have pointed out, internet distribution is coming on strong, and may rival or even supplant traditional broadcast. Either case is at least possible during the horizon of the contract to be negotiated. As such, the writers would have to be foolish or unreasonably desperate to allow a rate of 0% to stand.

Some studios claim that internet distribution is not payable (a 0% rate) because it is 'promotional' in nature, even as ads are sold, and revenue booked, on internet broadcasts. Bob Iger claimed on CNBC that about $1.5B of Disney's revenue were 'from Digital,' and Sumner Redstone vowed that Viacom would 'double its revenues from Digital' this year. 'From Digital' is obviously larger than just webcasts, so pick whatever fraction makes you feel comfortable; the point is that they are generating revenue from written content on the internet. You cannot have it both ways; either it is promotional, and a cost center, or it is a revenue generating center in its own right, and therefore subject to a similar payment schedule. It is disingenuous at best to tell banks and shareholders one thing and writers and actors another.


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## EVizzle (Feb 13, 2005)

I support the artists. If you sell commercial space on the internet during airings, you owe the writers and everyone else for the work.

I am going to use this strike, which will be long I would say, as a chance to get all caught up on my TV watching. Not too often you get to Tivo real life and fast forward thru the re-runs!


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## smak (Feb 11, 2000)

I think the Tivo Community is sophisticated in a lot of things, but Hollywood accounting is not one of them.

The key to the strike is what the showrunners do. If they stand strong and don't cross the picket line, the strike can be relatively short.

Maybe i'm wrong, but I don't think that the really big writer/showrunners/creators are going to be fired for breaching their contract. 

-smak-


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## IJustLikeTivo (Oct 3, 2001)

dswallow said:


> WGA-West has a strike fund of a little over $9 million and a "Good & Welfare" fund of $3 million. Generally they make loans with this money, though they can do grants as well.
> 
> WGA-East has a strike fund of just under $3 million.
> 
> Of course the real concern is how everyone else who's out of work because the writers are striking will fare... none of which can draw from the WGA's strike fund... www.actorsfund.com is apparently one place they can turn.


Which makes it doubly unfair to the collateral damage people.

I think they're drawing the line in the sand a bit too late here. If the strike lasts too long, people will find other sources of entertainment. DVD Rentals will go up, youtube traffic will spike and site for alternate webtertainment will get lots more traffic. Just as the RIAA has failed to embrace the internet as part of their business model, the video/tv industry has as well. Video Podcasts and the like become more popular every day. I just used the tivocast to sign up for a bunch of content on my S3 just to have backup material.


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## IJustLikeTivo (Oct 3, 2001)

Fassade said:


> Some studios claim that internet distribution is not payable (a 0% rate) because it is 'promotional' in nature, even as ads are sold, and revenue booked, on internet broadcasts. Bob Iger claimed on CNBC that about $1.5B of Disney's revenue were 'from Digital,' and Sumner Redstone vowed that Viacom would 'double its revenues from Digital' this year. 'From Digital' is obviously larger than just webcasts, so pick whatever fraction makes you feel comfortable; the point is that they are generating revenue from written content on the internet. You cannot have it both ways; either it is promotional, and a cost center, or it is a revenue generating center in its own right, and therefore subject to a similar payment schedule. It is disingenuous at best to tell banks and shareholders one thing and writers and actors another.


I think the problem is that if's difficult to determine this cost center.

If the video is directly sold via internet ( e.g. Itunes ) there is clearly revenue made and some costs associated with that revenue. It should be possible to calculate the profit/loss fairly simply. If there is profit and residuals are in play, there can be compensation.

It get more complicated when the video is VIEWED on the internet. Each V show doesn't have it's own distribution means . web site and ad revenue. They share it somehow with all the other stuff on the web site. Sometimes it's done by the network, sometimes by a third party. But, since the portal mostly acts to provide information/PROMOTION) for the network, how do you divide the promotional costs of the portal from the stuff directly tied to viewing? NBC may be trying to simplyfy this by having a direct distribution portal called hulu. Since that is only for viewing not promotion, theoretically, it would be easier to apportion costs which might help.

I tend to agree that showing clips or the like on a web site is promotional in nature but once they start showing videos in their entirety, it distribution, pure and simple. Of course, the question is how to do that. Some services are so annoying no one will use them unless they have no choice. CBS is that way. Three weeks ago, during the exchange of my series 3, I missed an episode of survivor and tried to watch online. But, the video was cut into 4-5 pieces and at the end of one, it was connected to the wrong next piece. They have to make that experience better or people will do what I did and go find a torrent. I'll watch cut up video on youtube for free but I'm not gonna sit through annoying ads for a crappy viewing experience. Make it compelling and I will watch. Make it real IPTV and exploit the data connection to add something to the experience and then you can figure out how to get money. Until then you're just trying to skin a bit of extra revenue.


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> I think the problem is that if's difficult to determine this cost center.
> (bits snipped)


When you run a web site, you *absolutely* how which ads which ads, and therefore where to which shows they are attached. Even the oldest traditional banner ad software (e.g. Omniture) helps you track this information. However, let us pretend that the studios are either too frugal or too incompetent to do this. I have not used CBS, but I have watched episodes on NBC.com. NBC **embeds the commercials in the clips themselves** -- it is impossible to argue that NBC does not know that Funship Island is sponsoring 30 Rock, when they are weaving Funship's content into the clips when they distribute, just like when they broadcast them over the airwaves.

So the networks have "view entire episode" sections of their web sites, and they are selling advertising in this section of the site. This occurs *today*, and is not paid because it is 'promotional.' How is this not distribution? How are the writers wrong in claiming the networks need to share here?

As for the argument of costs, that is the reason why most residuals are calculated against net. For example, when the percentages for DVDs were negotiated, they were paid far less than that of broadcast, because the studios incurred far more manufacturing and distribution costs. As a historical aside, these rates were negotiated in the days of VHS, with the studio pointing out that VHS costs a lot to manufacture, but there was no corresponding change in rates when the dirt-cheap DVD medium supplanted VHS. Bandwidth is still cheaper than manufacturing, and getting cheaper, so I suspect internet costs are still far less than DVD distribution. In either case, it is irrelevant. From CNBC to Charlie Rose, studio personnel are claiming millions (or, in Disney's case) billions on digital distribution. As you put it, the studios are at least trying to "skin a bit of extra money" -- and, since they are trying to skim money, they are not by definition exclusively using it promotionally ,and at the very least they owe some payment to the creative talent based on net.



IJustLikeTivo said:


> Make it real IPTV and exploit the data connection to add something to the experience and then you can figure out how to get money. Until then you're just trying to skin a bit of extra revenue.


And this is, in a nutshell, is why the writers are striking. IPTV is only on the rise. Is IPTV broadcast, and paid at 2.5%? Or is is "internet", and subject to 0%? Given past history, the studios will claim it as 0% -- I would, too, if I could get away with it. Given the studios history of questionable accounting and faith from the founding of United Artists up through that last writer's contract and the VHS/DVD transition, the writers clearly expect it. That is why they are striking, because if they let that contract stand as is, they are clearly and deeply screwed moving forward.


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## jradford (Dec 28, 2004)

IJustLikeTivo said:


> Make it compelling and I will watch. Make it real IPTV and exploit the data connection to add something to the experience and *then you can figure out how to get money.* Until then you're just trying to skin a bit of extra revenue.


It seems like the writers, producers, and a lot the general public consider the "then" in your statement to be either A) "now," to a certain sector of the audience or B) "very soon," to an even larger sector, (read: much less than 3 years from now.)

How are they supposed to wait until the next contract expires to make a stand on this? It makes no sense to be the last group to the party if you're the sole reason the party happens.


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## mrmike (May 2, 2001)

Just another worthwhile commentary on Hollywood accounting and how reality actually works.


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## IJustLikeTivo (Oct 3, 2001)

Fassade said:


> When you run a web site, you *absolutely* how which ads which ads, and therefore where to which shows they are attached. Even the oldest traditional banner ad software (e.g. Omniture) helps you track this information. However, let us pretend that the studios are either too frugal or too incompetent to do this. I have not used CBS, but I have watched episodes on NBC.com. NBC **embeds the commercials in the clips themselves** -- it is impossible to argue that NBC does not know that Funship Island is sponsoring 30 Rock, when they are weaving Funship's content into the clips when they distribute, just like when they broadcast them over the airwaves.
> 
> So the networks have "view entire episode" sections of their web sites, and they are selling advertising in this section of the site. This occurs *today*, and is not paid because it is 'promotional.' How is this not distribution? How are the writers wrong in claiming the networks need to share here?
> 
> As for the argument of costs, that is the reason why most residuals are calculated against net. For example, when the percentages for DVDs were negotiated, they were paid far less than that of broadcast, because the studios incurred far more manufacturing and distribution costs. As a historical aside, these rates were negotiated in the days of VHS, with the studio pointing out that VHS costs a lot to manufacture, but there was no corresponding change in rates when the dirt-cheap DVD medium supplanted VHS. Bandwidth is still cheaper than manufacturing, and getting cheaper, so I suspect internet costs are still far less than DVD distribution. In either case, it is irrelevant. From CNBC to Charlie Rose, studio personnel are claiming millions (or, in Disney's case) billions on digital distribution. As you put it, the studios are at least trying to "skin a bit of extra money" -- and, since they are trying to skim money, they are not by definition exclusively using it promotionally ,and at the very least they owe some payment to the creative talent based on net.


I don't think I was clear what my point is. Certainly when they watch A specific show, they know the revenue but when they come to the site, there is revenue generated just by someone being there, regardless of what show they watch. Some of that cost/benefit accrues to the shows that part is hard to track or apportion. Is the network generating viewers for show A or for show B? I'm not arguing that when watching any specific show they don't know. I'm just arguing about the cost/benefits of the rest.



Fassade said:


> And this is, in a nutshell, is why the writers are striking. IPTV is only on the rise. Is IPTV broadcast, and paid at 2.5%? Or is is "internet", and subject to 0%? Given past history, the studios will claim it as 0% -- I would, too, if I could get away with it. Given the studios history of questionable accounting and faith from the founding of United Artists up through that last writer's contract and the VHS/DVD transition, the writers clearly expect it. That is why they are striking, because if they let that contract stand as is, they are clearly and deeply screwed moving forward.


I think my point is that with IPTV, everyone has an opportunity to make money in new ways. Writer's have new ways to get their stuff in front of the public, they no longer are limited. I think they can take the bull by the horns and control more of their own destiny.



mrmike said:


> Just another worthwhile commentary on Hollywood accounting and how reality actually works.


In this article, he makes the same point. IPTV changes the game. With IPTV, you have a distribution means not controlled by the "big six" and a whole new revenue stream to exploit if you can figure out how.


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## BitbyBlit (Aug 25, 2001)

IJustLikeTivo said:


> It get more complicated when the video is VIEWED on the internet. Each V show doesn't have it's own distribution means . web site and ad revenue. They share it somehow with all the other stuff on the web site. Sometimes it's done by the network, sometimes by a third party. But, since the portal mostly acts to provide information/PROMOTION) for the network, how do you divide the promotional costs of the portal from the stuff directly tied to viewing?


Depending on the ads from which the writers want residuals, it doesn't necessarily need to be that complicated. If they only want residuals for ads displayed while a show is being watched, then that becomes easy to track.

This would mean they would get residuals from:
1. Ads embedded in the video.
2. Ads displayed in a video player that showed a particular video.
3. Ads displayed on a web site with an embedded video player showing a particular video.

But they wouldn't get residuals from:
4. Ads on a web site where you could download ad-free videos to watch locally on your computer or another device.

If a web site was dedicated to allowing downloads of videos, even ad-free ones, then I suppose one could make an argument that the only reason people would be coming to the web site would be to download the videos, and thus those should qualify for residuals even in case #4.

However, where it gets more complicated is when the web site has more than just downloads, which is what most of them have. In that case, it becomes more complicated to determine exactly why people are seeing ads. Is it because of the videos themselves or something else on the web site?

Most people go off and do something else while downloading something. So if people spend any amount of time on a web site, it is likely they would be doing something other than watching a download. They might be reading viewer comments of an episode, looking up when the next new episode would air, or be off doing something away from the computer until the download completed.

Even if #4 could be easily tracked, it is likely that a very low percentage of that would be qualified for residuals. And advertisers advertising for a specific video are going to want their ads tied more directly with that video anyway. So the writers might as well agree that they don't get residuals from #4, and by doing so the studios can't argue that the accounting is too complicated, because with the other options, the link is clear.


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> I don't think I was clear what my point is. Certainly when they watch A specific show, they know the revenue but when they come to the site, there is revenue generated just by someone being there, regardless of what show they watch. Some of that cost/benefit accrues to the shows that part is hard to track or apportion. Is the network generating viewers for show A or for show B? I'm not arguing that when watching any specific show they don't know. I'm just arguing about the cost/benefits of the rest.


I could be wrong, but I do not think the writers have ever argued for a cut of the banner ads from the home page of nbc.com, just residuals from the shows as they are "broadcast." Then again, the union as a whole could argue that without their product, nobody would come to the site at all, so they should get some cut there too, but that is not my argument.

Again, we have a situation today where whole episodes are shown, with paid commercials. How are the writers wrong in demanding compensation here?



IJustLikeTivo said:


> I think my point is that with IPTV, everyone has an opportunity to make money in new ways. Writer's have new ways to get their stuff in front of the public, they no longer are limited. I think they can take the bull by the horns and control more of their own destiny.


Yes, to a certain small extent, they do. How does that justify the 0% rate and behavior of the studios?


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## IJustLikeTivo (Oct 3, 2001)

FWIW, I don't disagree in general with the idea that watching a whole episode, however that happens, is basically the same as watching on TV and should be compensated by the same scheme more or less. I think downloading, even if it expires, with no commercials is a sale and should be compensated under those rules. Either the customer pays with cash or by watching commercials/ads of some sort. I'm not expecting to get something for free, especially if the people who made it don't get paid.

I think clips are rightly considered to be promotional material designed to get you to watch an entire episode/movie. Unless you do go ahead and watch, that becomes a promotional cost.


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## dswallow (Dec 3, 2000)

Fassade said:


> Again, we have a situation today where whole episodes are shown, with paid commercials. How are the writers wrong in demanding compensation here?


Ostensibly episodes are available online for free to allow people to see episodes they missed on broadcast television, *for which rights were already paid*. Further, such online viewing is restricted to the US as well, which almost ensures that only those who might possibly have had the opportunity to see the broadcast would see the online episodes.

As for paid internet downloads, I keep seeing conflicting information there... as far as I know the writers do get a cut of those at the home video rate; it's the free online downloads they don't specifically get a cut from -- more specifically, material written to be exclusively available online, not just downloads of material that was broadcast.

Complicating online advertising revenues further is that many of these deals are often packaged with broadcast advertising; the idea being that the advertiser is paying to reach the viewers of the program, no matter how the viewers get it. If the revenue model were 100% product placement, the advertisers would even be benefiting by "illegal" file sharing of episodes.


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## RayChuang88 (Sep 5, 2002)

A couple of comments:

1) I think in the end, we will see a strike settlement that--unfortunately--could add about US$1-US$2 to the retail cost per DVD/HD-DVD/Blu-Ray disc and probably about US$0.50 per video download. The reason is simple: the WGA settlement will be the model for the SAG/AFTRA and DGA contracts due July 2008.

2) A little off-topic, I've seen the Piaggio P180 Avanti fly out of Sacramento International Airport--it has a very distinct engine sound due to its five-bladed propellers. By the way, flying the P180 in a simulator definitely does not simulate how well the plane flies, since Piaggio configured the controls so it flies like a normal plane if you fly the "real" thing.


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## BitbyBlit (Aug 25, 2001)

IJustLikeTivo said:


> I think clips are rightly considered to be promotional material designed to get you to watch an entire episode/movie. Unless you do go ahead and watch, that becomes a promotional cost.


But we aren't talking about simple promotional material here. We're talking about promotional material (clips or webisodes) with promotional material (ads). If they were giving away all the promotional material for free, nobody would be asking for residuals because there wouldn't be any profits from which to get them.

Now, I do think it is only fair that the studio gets to subtract the cost of distributing that promotional material, however. For example, if Pepsi agreed to pay a show for using clips showing people drinking their products in advertisements for that show, and they paid the studio what the studio paid to run the ads, then no residuals should be given because the studio didn't make any money off of the ads. On the other hand, if the studio started making money off of showing promos for their shows, then I think it would be fair to share their profits with the writers.


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## Fassade (Apr 8, 2004)

dswallow said:


> Ostensibly episodes are available online for free to allow people to see episodes they missed on broadcast television, *for which rights were already paid*. Further, such online viewing is restricted to the US as well, which almost ensures that only those who might possibly have had the opportunity to see the broadcast would see the online episodes.


Episodes are not made available through the benevolence of a network to help those who missed a show. They are made available online under the same implied contract with the viewer as they are over the air: watch our shows, watch our ads. Furthermore, the network does not show the exact same broadcast the user might have missed; they sell new advertising time/space in an attempt to create two separate profit centers, but they only want to compensate the creators in one venue. As Penny Arcade put it:


> The Writers Guild is dealing with the same issues that Musicians have been dealing with, that is to say, compensation when the same work takes on a different form in this baffling digital age. The way contracts are currently written, there is some magical distinction between content that is broadcast on television, played from a disc, or streamed online. It's hard to imagine there are people who actually claim to believe this kind of mysticism.


The studios like this division, because it has, under the expiring contract, allowed them not to pay for internet-delivered content. The writers may not like that division -- and I think that both logically and from a fairness standpoint, it stinks -- but it was permissible under their 1988 contract, and they have had to abide by it. Now that these contracts are up for renegotiating, the writers (and soon, the directors and actors), are trying to close that loophole, subject to differences in studio costs across the different channels.


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## bareyb (Dec 1, 2000)

Fassade said:


> I have a feeling this could end very badly for the writers. This dispute was originally about different residual rates on the internet, but, within a few pages, the forum question turned to one of eliminating residuals entirely.


I am one who thinks residuals should be done away with. Their time has passed as it has for most of the unions these days. I was in the union for a few years and all they did for me was take my money. I have absolutely no sympathy for any "professional" who threatens to walk out if their demands aren't met. I think "strikes" are nothing more than sanctioned blackmail. The more support these guys get from the public the more likely this will become a regular occurrence.


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## Fassade (Apr 8, 2004)

bareyb said:


> I am one who thinks residuals should be done away with. Their time has passed as it has for most of the unions these days. I was


Fair opinion, but not really germane to the strike, because even the studios are not seriously proposing this. While I am sympathetic to the writers here, I am not blindly pro-hollywood-union. If the studios can bargain residuals away, they will, and good for them. However, negotiation by definition is a give and take. If they studios manage to take residuals away, they are going to have to give something in return, and that something will be up-front payments. To restate:

1) Studio A has an up-front development budget of $100,000, to use however they want to procure as many hits as possible.
2) Every story they pay to help develop, they must also acquire the rights.
3a) With residuals, the studios can offer $5,000 to a writer, with the promise of more if and only if the show does well. With our fictional $100,000 budget, Studio A can fund 20 show ideas.
3b) Without residuals, they studios may have to offer $10,000 or more to each writer to persuade him/her to transfer their only valuable asset - development rights -- to the studio. Now, Studio A can fund, at most, 10 show ideas.

It is simple math, really. The more the studio has to pay up front, the less scripts they can option on a fixed budget, and the safer they will have to play it with those that they do fund, becuase they have less attempts to find something that works. To the inevitable reply that they would be better served by funding only 10 *good* ideas -- I would agree, if we could find that executive who knew for sure which idea would work, in which case he/she could fund just that one. The simple fact is, nobody can know for sure what will work; development execs are paid to take their best guesses, and allocate resources accordingly. The best ones sniff out a higher number of good ideas, but even the best guesses of the best executives fail much of the time. IMHO, killing residuals would drastically accelerate the trend towards blander TV and movies, because residuals encourage risk by capping failure costs and helping development executives cover their own asses for the 90% of choices that fail.

Even the studios recognize this, and that is why they do not want to kill residuals entirely. They do want to reduce their payments -- same as any rational employer would. The writers, for their part, want to increase their payments -- same as any rational contract employee would. Both sides are in a shouting match over the numbers, not the concept. Hopefully, they can hash it out before too much collateral damage is done.


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## dswallow (Dec 3, 2000)

Fassade said:


> To restate:
> 
> 1) Studio A has an up-front development budget of $100,000, to use however they want to procure as many hits as possible.
> 2) Every story they pay to help develop, they must also acquire the rights.
> ...


But nothing any of us are proposing prohibits a studio from making a deal with the writers to do just that. What we're advocating is that the WGA's Minimum Basic Agreement should not require residuals.

A studio should be free to make deals with writers on these sorts of terms, if both sides want to do so. And if it really is a benefit to the studios to be able to foist off future payments as residuals, I'm sure they'd be happy to do so.


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## Fassade (Apr 8, 2004)

dswallow said:


> But nothing any of us are proposing prohibits a studio from making a deal with the writers to do just that. What we're advocating is that the WGA's Minimum Basic Agreement should not require residuals.
> 
> A studio should be free to make deals with writers on these sorts of terms, if both sides want to do so. And if it really is a benefit to the studios to be able to foist off future payments as residuals, I'm sure they'd be happy to do so.


Fair enough, except this is a real-world contract negotiation -- by definition, a give and take -- and, whether you agree with them philosophically or not, minimum residuals are an entrenched fact before you even get to the negotiating table. Unless the writers are monumentally stupid, desperate, or both, they are not going to give a concession (no minimum residuals), without getting something in return. So, pretend you are a studio, and you do not want to pay minimum residuals any more. What would you propose a studio put on the table in return, to get the writers/directors/actors to accept?

If the answer is "increased minimum payments," then I have outlined why I think TV/movies would become blander and suffer, and that, more than any sympathy for the writers, is why I argue this point. You are free to disagree, but a rebuttal on the points would be nice.

If the answer truly is "nothing, sod off," then the writers -- and then probably soon the actors and directors -- probably should be striking, as they would have no other option, except, as IJLT earlier pointed out, to leave the business/do their own thing.

That is why the studios are not proposing killing the system, because they do not want that endgame any more than do the players. The studios would like to squeeze as many points out of their talent as possible, just like any business would, and I certainly do not begrudge them the attempt.

However, until the studios or the writers seriously propose elimination of the residual system at the table, we have to assume they exist. Given that, the discussion returns to the issues of the strike -- differential payment depending on the means of distribution, and, in particular, no payment at all for any distribution over the internet.


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## Vito the TiVo (Oct 27, 2003)

dswallow said:


> But nothing any of us are proposing prohibits a studio from making a deal with the writers to do just that. What we're advocating is that the WGA's Minimum Basic Agreement should not require residuals.


Fortunately or unfortunately, the AMPTP would never agree to such a situation even if the WGA were willing to take more real money up front and give up residuals. A larger payment rather than a deferred payment.

The AMPTP won't agree to _any_ percentage on streaming programming which they believe is theoretical at best (it's real), so I don't see how in any world they would agree to give up _real_ money up front in lieu of giving up theoretical money on the back end.

I think a lot of writers would love getting a larger upfront payment, especially for soaps, talkshows and failed series, these things don't exactly get a ton of money in residuals as they are not replayed.


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## IJustLikeTivo (Oct 3, 2001)

Fassade said:


> Fair enough, except this is a real-world contract negotiation -- by definition, a give and take -- and, whether you agree with them philosophically or not, minimum residuals are an entrenched fact before you even get to the negotiating table. Unless the writers are monumentally stupid, desperate, or both, they are not going to give a concession (no minimum residuals), without getting something in return.


Well, to be over the top. In 1859, slavery was an accepted means of compensation. Was it right? Was it the only way? No.

The fact that residuals worked was a great thing but there is increasing evidence that it may no longer be a viable means of compensation. Every possible option should be discussed. Not just one.



Vito the TiVo said:


> Fortunately or unfortunately, the AMPTP would never agree to such a situation even if the WGA were willing to take more real money up front and give up residuals. A larger payment rather than a deferred payment.


They would do it in a hot second if they thought it would make them more money. If for example, they currently pay $5k plus residuals of $5k and they agree to pay a flat $10K cause they know they have a new revenue model on the internet where they get more than $5k in ad revenue. If they didn't agree they would be stupid business men. No, make no mistake, both sides are trying to get more money and the one that blinks first will lose. I think the producers have more options ( overseas, etc) than the writers but we'll see.


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## Vito the TiVo (Oct 27, 2003)

IJustLikeTivo said:


> They would do it in a hot second if they thought it would make them more money...


Except by their own logic, they're arguing that a lot of series fail, so therefore the backend would get them nothing. They're talking out of both sides of their mouth saying that a lot of series fail, so they need to recoup costs but then also arguing that they don't make any money off these things...


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> Well, to be over the top. In 1859, slavery was an accepted means of compensation. Was it right? Was it the only way? No.


Wow. That is so far over the top that I cannot even look down and see where the top was. Not quite Godwin's Law, but arguably worse. You cannot with even a shred of seriousness compare a contract negotiated willingly by both sides to compare forced-by-the-threat-of-pain-or-death servitude.



IJustLikeTivo said:


> The fact that residuals worked was a great thing but there is increasing evidence that it may no longer be a viable means of compensation. Every possible option should be discussed. Not just one.


As for evidence, where is it? I have never even seen this claim except as posturing, much much less 'evidence.' Are you referring to the opinion (which I share, btw) that TV has gotten worse in the past few years? Residuals began in Television in 1952. I would love to see any analysis that can isolate a single, consistent, 55 year old factor, and lay the blame for failings during that period where it remained consistent, upon it. Of course, if the 'increasing evidence' compares 1947-1952 television with 1952 and on, I suppose the statistics could be valid; otherwise, you would be far better served looking for things that have changed during the time period you reference.



IJustLikeTivo said:


> They would do it in a hot second if they thought it would make them more money. If for example, they currently pay $5k plus residuals of $5k and they agree to pay a flat $10K cause they know they have a new revenue model on the internet where they get more than $5k in ad revenue. If they didn't agree they would be stupid business men. No, make no mistake, both sides are trying to get more money and the one that blinks first will lose. I think the producers have more options ( overseas, etc) than the writers but we'll see.


Does internet distribution make money, or doesn't it? Either it makes money, in which case residuals are a bad decision for the studio, or it does not, in which case upfront flat fees are bad. You cannot have it both ways.

As for the rest, agreed on all counts, except I would add this rider:

"they would do it in a hot second if they thought it would make them more money...*and could get the writers to agree and/or believed that any exodus or writing talent would be no more than an acceptable loss*"

It is all well and good to talk about the elimination of residuals in theory, but in a real world non-slavery situation, you have to give something to get something, unless you just do not want to dance with your partner anymore. If the studios have (as you say) more options, and more money, why do you encourage them to exert pressure to get a better deal, but begrudge the writers the same freedom?


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## IJustLikeTivo (Oct 3, 2001)

Fassade said:


> Wow. That is so far over the top that I cannot even look down and see where the top was. Not quite Godwin's Law, but arguably worse. You cannot with even a shred of seriousness compare a contract negotiated willingly by both sides to compare forced-by-the-threat-of-pain-or-death servitude.


It was intended to be very over the top to emphasize my point. I think the reason both sides are so hard and fast is that they're scared. Neither one wants to guess wrong but I think they're still stuck in an old revenue paradigm and feel helpless to change.

I think they need to put everything on the table and collectively try to figure out where the future may be. The RIAA has the same problem. The cat is out of the bag, digital IS their future but they still cling to the old CD based revenue model and despite copious evidence that they revenue model they use is wrong, they steadfastly refuse to embrace another or even really investigate a new one. Some bands like Radiohead are taking the reins of their careers and trying new things. Will they work? Who knows but the point is that they are trying. I think the WGA and the AMPTP are the same.

Without vision they have on hope of guessing right, all we know for sure is that the old models are broken. Negotiating based on those models is most likely broken too.



Fassade said:


> It is all well and good to talk about the elimination of residuals in theory, but in a real world non-slavery situation, you have to give something to get something, unless you just do not want to dance with your partner anymore. If the studios have (as you say) more options, and more money, why do you encourage them to exert pressure to get a better deal, but begrudge the writers the same freedom?


I don't think I ever encourage them to exert pressure to make a better deal and I don't begrudge the writers one bit. I do think they need to really examine their business model and see if it is viable. I think the current one is not. Clearly the writer's feel they aren't fairly compensated and I think some of that is based in a valid distrust of the accouting practices while other parts of their positions is based on the fact that the current models weren't dreamed of in the last negotiation and therefore are outside that contract. Could they come to a compromise, probably, but the levels of distrust make that increasingly unlikely and clearly negotiating in the press hurts both sides more than saying nothing.

I think the AMPTP is exhibiting bad faith by not even showing up or proposing new options but that doesn't automatically mean they are wrong any more than the fact that fellow unions honor the picket line. Unions can and do disagree in private but they are pretty good about presenting a unified public face since the ability to hold together when it gets tough is the only real thing they have in their favor sometimes.


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> I don't think I ever encourage them to exert pressure to make a better deal and I don't begrudge the writers one bit. I do think they need to really examine their business model and see if it is viable. I think the current one is not. Clearly the writer's feel they aren't fairly compensated and I think some of that is based in a valid distrust of the accouting practices while other parts of their positions is based on the fact that the current models weren't dreamed of in the last negotiation and therefore are outside that contract. Could they come to a compromise, probably, but the levels of distrust make that increasingly unlikely and clearly negotiating in the press hurts both sides more than saying nothing.
> 
> I think the AMPTP is exhibiting bad faith by not even showing up or proposing new options but that doesn't automatically mean they are wrong any more than the fact that fellow unions honor the picket line. Unions can and do disagree in private but they are pretty good about presenting a unified public face since the ability to hold together when it gets tough is the only real thing they have in their favor sometimes.


While obviously I have an inclination to trust the writers over the studios (and have posted in this thread more than I have in years  ) because of that accounting/faith history, I do not think the studios are evil, nor do I think the writers are saints. Studio and union are both business entities looking out for their own best interests. In fact, while we have some legitimate disagreements, I think we are closer to agreeing than most of our respective posts would indicate 

Despite the past, hopefully the writers and studios can come to their table and find some common ground, too, and hammer out a deal quickly to limit the collateral damage.


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## marksman (Mar 4, 2002)

When odd side-effect of all this is we may have a temporary reprieve from early cancellations. With content running out concerns, I doubt any shows are going to get axed until whatever is done is aired.

Some have mentioned Big Shots and other shows getting killed, but they would have been killed anyways, and likely without airing all finished episodes... Should be interesting to see...

As for internet revenue, I don't think it would be hard at all to track ad revenue on a website that distributes content. You could easily track what people are doing when they see a particular ad. Just because the same ad on a website does not mean they can not pinpoint exactly what percentage of that ad run was during a particular show, for example, and distribute revenue. In fact that is all very trivial stuff to accomplish.


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## smak (Feb 11, 2000)

While the RIAA, MPAA & AMPTP are similar in that they were always late to see how new technology would make them money, making a CD and making a television show are two entirely different things.

Radiohead writers, produces, performs and records their music, can package and distribute it, sell it for $2.00 per album and make twice as much money as they did under the old normal distribution model.

There is no comparison to a TV writer. There is no other business model for a writer. What other model could JJ Abrams and Damon Lindelof get Lost on the air? You want them to abandon the network system, and get financing on their own, and sell it into syndication? You're talking about a total revolution of the entire television system.

Today I saw Summer Redstone & Les Moonves on old business shows crowing about how much money they were going to make via digital download, how it didn't matter to them how it sold, it's all the same thing. They just don't want to pay the writers like it's all the same thing.

-smak-


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## The Flush (Aug 3, 2005)

smak said:


> You want them to abandon the network system, and get financing on their own, and sell it into syndication? You're talking about a total revolution of the entire television system.


Yes that's a great idea.


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## Rob Helmerichs (Oct 17, 2000)

The Flush said:


> Yes that's a great idea.


In theory, yes.

In practice, look at the most lavish syndicated shows. Compare the production values to Lost. Then look at the ratings of the most successful syndicated shows. Compare to Lost.

For high-end television, the studios are the only game in town, and will be for the foreseeable future. The writers have to negotiate for the foreseeable future, not for some cloud-cuckoo-land fantasy of how things ought to be.


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## IJustLikeTivo (Oct 3, 2001)

Fassade said:


> To restate:
> 
> 1) Studio A has an up-front development budget of $100,000, to use however they want to procure as many hits as possible.
> 2) Every story they pay to help develop, they must also acquire the rights.
> ...


BTW, just wanted to acknowledge that, for me, this is the best explanation of why residuals make any sense at all. And, it does a good job of framing the risks that the writer's do take in getting something less up front each time knowing that unless the show is a hit, that's all they get. Now, the question of how much that up front payment is, is still up for grabs but nonetheless, a good job of framing the issue.


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## cwoody222 (Nov 13, 1999)

Damon Lindelof on the strike:
http://www.nytimes.com/2007/11/11/o...ef=slogin&oref=slogin&oref=slogin&oref=slogin

Nowhere in there does he mention that he's also a co-creator and producer on Lost. Does he get residuals on web episodes in those roles?


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## dswallow (Dec 3, 2000)

cwoody222 said:


> Damon Lindelof on the strike:
> http://www.nytimes.com/2007/11/11/o...ef=slogin&oref=slogin&oref=slogin&oref=slogin
> 
> Nowhere in there does he mention that he's also a co-creator and producer on Lost. Does he get residuals on web episodes in those roles?


http://www.tivocommunity.com/tivo-vb/showpost.php?p=5689856&postcount=133


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> BTW, just wanted to acknowledge that, for me, this is the best explanation of why residuals make any sense at all. And, it does a good job of framing the risks that the writer's do take in getting something less up front each time knowing that unless the show is a hit, that's all they get. Now, the question of how much that up front payment is, is still up for grabs but nonetheless, a good job of framing the issue.


Thanks -- and I absolutely agree that all numbers are up for grabs. I do, however, think the studios favor the basic redisuals concept privately, even as they decry it publicly as a negotiating tactic. Since my take on residuals from the studios point of view was well-received, let me try and tackle it from the writers' side, and bring them together:

1) Potential screenwriter B has a job, either writing-related or not.
2) This job, though lacking Hollywood glitz, is stable, and is enough to make a living.
3) Screenwriting is inherently less stable, since most shows fail, and those that do succeed are year-to-year.
4) To convince screenwriter B (or anybody, really) to leave stable career for a risky one, you need to offer a significant incentive.
5) Residuals allow studios to lure the writers with a significant incentive (yes, the dream of riches -- writers are not immune to the call of the dollar) without bankrupting themselves with upfront payments on failures.

Incentives are, of course, personal. For some writers, the glamor of Hollywood would be enough. I am also sure there are other screenwriters who fit the classic suffer-for-their-art-model. For them, residuals vs upfront payment would make no difference. However, for most people, you need tangible compensation to persuade somebody to move from a low-risk situation to a high-risk one, and this is where residuals are a useful tool.

As a writer, ask yourself -- how likely would you be to uproot job/family and leave a $25,000 job for a one-time payment of $50,000? Now ask yourself, how likely would you be to leave a $25,000 job for a $25,000 payment, and a chance, however small, of $750,000 or more? The answer is of course personal, but I suspect the answer for a large number of potential writers, the best of whom embrace high risk/reward in their writing, is the latter. Without residuals, then, less writers would come to Hollywood.

Back to the studios -- they could counteract this trend by offering more up front, but studios, like most businesses, tend to be risk-averse; they are far less likely to pay equal or more for an uncertain outcome. Not only would studios be less *able* to attract new blood if they had to pay each writer more up front, they would be less *willing* to attract new blood, because new writers would have an "uproot disincentive" to overcome in each individual negotiation, whereas existing writers would not. New writers would become more of a bad economic decision.

As a studio executive, ask yourself -- with your career depending on each decision, would you be more willing to pay $50,000 to somebody with a track record, or $50,000 (+ some possible "moving" factor) to somebody whose only output is one or a handful of unpublished scripts on your desk? There is still a huge failure risk with any new story idea; if you eliminate residuals, you basically transfer that risk from the writer to the studio executive. Since businesses have to be more risk-averse than creative people, it is hard to believe they would embrace that responsibility and risk. These executives would understandably be biased in favor of what they already know works. This would lead to an ever-increasing cycle of ever safer, less risky fare.

Without residuals, then, less new writers would come to Hollywood, and studios would be less willing to take a chance on those who do. I feel TV and movies, as a result, would grow even more insular, and the programming I watch even staler.


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## skywalkr2 (Jun 16, 2003)

Who is right? Who is wrong? I just know it is bad news for TV networks if they don't work this out real quick. My wife, for one, has stopped watching any shows because she is pissed. She says she isn't sure she will even pick up watching them after the strike is over.

Kind of like how people were slow coming back to baseball after the 1994 strike.


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## OldFantom (Aug 24, 2004)

What this strike, in fact in labor disbute, comes down to is who need whom more? If I can get cheap labor offshore, why am I going to deal with a garment maker union? Football, we can find players that will play if the union won't. I suspect this all comes down to the fact that the Studio have no choice but to deal with the writers. Sure, you can get your million monkeys to write Shakespeare, but who is going to shoot the script, who will act in the show. Let's face it, Hollywood is so firmly a union town, that they have to cave in or replace everyone. This will drag for a few months and then the Studios will give in. The only losers are those of us who are stuck with 80 hours of "Deal or No Dancing with The American Survivor Millionaires' while the studios try to convince themselves that they have any real power here.


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## Fassade (Apr 8, 2004)

OldFantom said:


> What this strike, in fact in labor disbute, comes down to is who need whom more? If I can get cheap labor offshore, why am I going to deal with a garment maker union? Football, we can find players that will play if the union won't. I suspect this all comes down to the fact that the Studio have no choice but to deal with the writers. Sure, you can get your million monkeys to write Shakespeare, but who is going to shoot the script, who will act in the show. Let's face it, Hollywood is so firmly a union town, that they have to cave in or replace everyone. This will drag for a few months and then the Studios will give in. The only losers are those of us who are stuck with 80 hours of "Deal or No Dancing with The American Survivor Millionaires' while the studios try to convince themselves that they have any real power here.


As an aside, I am sure at least a few people here are old enough to remember the 1987 NFL strike, where the owners did field all replacement players. I lived some of that year in Chicago, and some in San Francisco -- my favorite newspaper names for the replacement players were the "Spare Bears", the "Bearlies," and the "Phony Niners." Then again, it is hard not to feel bad for those replacement players, who were called scabs and worse just for wanting a crack at the NFL. Had I been a great-but-not-quite-NFL-caliber athlete at the time, I probably would have done the same thing. A few of them even went on to quite solid NFL careers after the 'real' players came back.

The NFL players were more union at the time than even Hollywood, but, IIRC, eventually public sentiment turned against the players, the players planned poorly, and their union was crushed and decertified...score one for the owners...only to reborn as the NFLPA immediately thereafter, which won an antitrust judgment against the owners. Millions of dollars later, the score tied 1-1, both sides finally shut up their rhetoric and negotiated, and the union even reformed.

All sympathies for either group aside, the lesson should be that neither the studios nor the writers have as much leverage as they think. I sincerely hope they realize this and can hash out some fair numbers together, before too much damage is done to each other, not to mention related workers. Competition is fierce, but it is still a big pie. Sit down, figure out a fair way to share it, and give our TiVO's something worthwhile to record.


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## marksman (Mar 4, 2002)

I would like to address Fassade's notion that many writers would go do something else, and we would have less variety and the rest. This is an issue that comes up with entertainment related salaries all the time. Be it actors, writers, atheletes.

All these groups can get enormous salaries at the top end of the scale. Ridiculous money. Yet are you to tell me if they top actors only made $250k a year instead of $50 million a year, that we would not have just as many actors? Do you think most people would be able to get jobs in other fields that would compensate them even a tiny fraction of what they make as being an actor? Same goes for writing. Same goes for baseball players. A-Rod wants 30-35 million a year, after making $25 million for the last 7 years. If the top baseball player only made $350k a year, do you think A-Rod would be playing baseball or doing something else?

The reality is the payscales get crazy because money is literally falling from trees and has for a very long time. Sure people on the lower-end tend to get squeezed, because the unimaginative business people have to take their revenge out for the huge percentages they give away. In fact a recent report just came out that says the studios are in a world of hurt because of the gross percentage deals they are giving big name actors, directors and writers. I don't remember the period in question, but the profit participation for the big names was 3 billion dollars plus, which essentially dwarfed what the studios themselves were actually making. 

If/when the money train does dry up, and there are potential readjustments, you will still have writers, and you will still have actors and you will still have directors. Right now there are 10s of thousands of them in New York and LA who wait tables and make $15k a year. Do you think they would not work for $100k a year?

More specifically to writers, getting anyone to acknowledge you as a writer in Hollywood is a pretty difficult thing to accomplish. If the networks went out and actually recruited new talent for less money, they might end up with NEW FRESH IDEAS, instead of more stale ones, like Fassade might predict. There are probably a lot of talented writers out there who never got a chance to get in, who might if the dynamic is changed, and the process is changed. The current system is not very conducive to absorbing new blood and new ideas.


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## Fassade (Apr 8, 2004)

marksman said:


> I would like to address Fassade's notion that many writers would go do something else, and we would have less variety and the rest. This is an issue that comes up with entertainment related salaries all the time. Be it actors, writers, atheletes.
> 
> All these groups can get enormous salaries at the top end of the scale. Ridiculous money. Yet are you to tell me if they top actors only made $250k a year instead of $50 million a year, that we would not have just as many actors? Do you think most people would be able to get jobs in other fields that would compensate them even a tiny fraction of what they make as being an actor? Same goes for writing. Same goes for baseball players. A-Rod wants 30-35 million a year, after making $25 million for the last 7 years. If the top baseball player only made $350k a year, do you think A-Rod would be playing baseball or doing something else?


This strawman crops up all the time, and it neglects everything up to the point of landing safely at the top end. If you start with a fully polished skill and a guaranteed choice between $30 million or $350k, of course the answer is obvious. I would *love* to have that choice. The real decision, which you have ignored, comes earlier -- would you be as likely to devote your entire life to cultivating that skill in order to work towards that point, without any guarantee of 30 dollars, much less 30 million? Then it is not nearly so clear-cut. For your argument still to hold, one of two things must hold true:

1) The person in question *is certain* to get into a screenwriting career with a salary near or above what they can get elsewhere, or:

2) That the person in question has no other marketable skill, so that screenwriting is their only option.

For most writers, whose skillsets intersect with that of many other white-collar careers, and who often have at least a college education, neither is true.

Since you use one extreme example in A-Rod, let me give you another, this one in the TV industry. In 1974, Glen Charles was a copywriter. Maybe not the best job, but a stable, relatively well-paying one. He left his job (and his brother Les a less well-paying, but even more stable job as a public school teacher) to move to Hollywood. They sent out dozens of spec scripts, with not a single bite. Finally, they sold one M*A*S*H episode, and then went through another two years without a single sale. For much of that time, Les and his wife lived out of their van (presumably funded in part by residuals, though I do not know.) In short, they lived the same type of story as the 1000s of people waiting tables that you cite.

Now, would you be more likely to leave a steady job, live in your car (and -- ouch -- persuade your spouse to live in that car too), for an uncertain payoff, if that payoff was large, or if it was small? The Charles brothers took that chance, and eventually broke through to write for The Bob Newhart Show, Taxi, and to create Cheers. I cannot speak to their personal motivation, but their story of a difficult break-in to the business is not entirely atypical. Hell, you bring it up yourself in the form of the 1000s waiting tables in NY and LA. All you have to do is grant that *some* people would be less likely to leave a decent situation for an crappy/uncertain one if they cannot dream of being another Glen Charles, and logically, there has to a smaller number of scripts available, which decreases the overall variety in the system. You may argue the decrease in variety would not be significant, but the reduction would be inevitable.



marksman said:


> Sure people on the lower-end tend to get squeezed, because the unimaginative business people have to take their revenge out for the huge percentages they give away. In fact a recent report just came out that says the studios are in a world of hurt because of the gross percentage deals they are giving big name actors, directors and writers. I don't remember the period in question, but the profit participation for the big names was 3 billion dollars plus, which essentially dwarfed what the studios themselves were actually making.


I read the same story (though I cannot find a link), and it is true, studios and little players are hurting. Frankly, the problem is not unimaginative business people, it is that the business people were *too* imaginative, and now their shady accounting karma is coming home to roost, and killing the little player in the process. For almost a century, studios have cooked their books to show that films do not make money; I read another article where a studio exeutive claimed only 5% of movies *ever* made a profit. (Forrest Gump and the 1989 Batman, for example, were two such "money losers.") This is precisely why most payments are made off net; if a movie can be shown to lose money, the studio never has to pay those fees.

There is an old saying in Hollywood -- "a percentage of the net is a percentage of nothing." Not being stupid, the biggest players in Hollywood -- Hanks, Spielberg, etc. -- demand percentages of the gross as soon as they have the clout, to avoid being screwed by this kind of accounting. As studios rely less on stories and more and more on name actors and directors (rarely writers, except book crossovers like Steven King), these stars are able to demand larger and larger pieces of the gross, and there is less left over for everybody else -- studio, writers, and any other net player. Yes, all of those people, including studios, are being screwed to pay a ridiculously high top end, but I fail to see how you can lay any blame at the feet of anybody except the studio accountants. If you want to bring some financial health back to the industry, all you have to do is start giving honest accountings of your films.



marksman said:


> More specifically to writers, getting anyone to acknowledge you as a writer in Hollywood is a pretty difficult thing to accomplish. If the networks went out and actually recruited new talent for less money, they might end up with NEW FRESH IDEAS, instead of more stale ones, like Fassade might predict. There are probably a lot of talented writers out there who never got a chance to get in, who might if the dynamic is changed, and the process is changed. The current system is not very conducive to absorbing new blood and new ideas.


Interesting...I have never heard anybody in any industry ever say that the way to recruit more and/or better employees is to offer less money.

Look, I do not deny that breaking in is very difficult (I tried once, failed, and went on to a different job). I do not deny that 1000s of people with more guts and talent than I are persevering, waiting tables or living in cars, just hoping for a break. All I maintain is that, the smaller you make that prize at the end of the rainbow, the more of those 1000s of people will simply choose to get out of the rain instead. I do not see how this is even arguable. 
Since the overall number of writers would decrease, the only way the industry benefits is if a) we have a surplus of good writing ideas, so that studios current vision of other scripts is obscured, or b) only the worst writers leave, so that the ideas of those who remain are on a whole better than those who quit the business. I suppose either is possible, but, if you are are going to decrease the overall talent available and increase the risk on the studio, you should have some very strong supporting evidence.


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## IJustLikeTivo (Oct 3, 2001)

I think the point he was trying to make is that the odds are good that just based on numbers, there are lots of people to replace the current hit writers. Just as there are less actors making a living wage in SAG, there are very likely tons and tons of talented writer's out there who haven't gotten a break. 

If the studios were forward looking, they would invest the money to pay people a small salary to just write. If these people worked on a different up front plan till they were good, the odds are that if they front load enough writer's they'll find enough cream to rise to the top.

This was the old system under the studios before stars got sufficient strength to break that mold. Throught most of the century into the 60's actors, writers etc were hired to work on anything the studio wanted and they turned out tons of stuff. Some good, some bad, some cult classics. But, the point is they did a lot of stuff and slowly they learned their craft. As they did better work, they got better roles or they got to write better movies. It was based on volume. Now, the studios turn out less stuff and therefore bet more heavily on tentpole pictures to hit big and cover loses. TV shows do the same thing. On a percentage basis, less that 30 percent of new shows last a year. That's a lot of cost that will never be recovered. The produce at a loss to make money in ancillary sales. No ancillary sales = no profit. 

With the stakes higher, the willingness of ability to take risks goes down. They try to lock in profit by buying a star that can open the movie, the best ad campaign, the best release dates and the best TV appearances on the press junket. Ironically, the thing that has saved Hollywood and TV is the Secondary market. DVD. DVD pre-sale money is now used to finance the movie. Very little cash is risked since you pay for production with video rights for sale and blockbuster for rentals. The need to tie up all that cash is the reason everyone want to take a bigger share. 

Sometime I really think the old studio systems were better. Less really big hits but more so so stuff. Rant over.


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> I think the point he was trying to make is that the odds are good that just based on numbers, there are lots of people to replace the current hit writers. Just as there are less actors making a living wage in SAG, there are very likely tons and tons of talented writer's out there who haven't gotten a break.


That is my entire point -- the odds are not just as good as based on numbers. You reduce the numbers, without any counterbalancing factor. *BY DEFINITION,* the numbers, and the odds, are worse. To return to the analogy of the football strike, there were lots of people willing to step in to be replacement football players, too. That did not mean the quality of play for those 4 games in 1987 was better. I am not trying to say that unpublished writers are somehow worse --- just like the published writers, some will be good, and some will be bad. All things being equal, the more you pay, the more people you can attract to the business, just like in every other business on the planet. The more people you can bring in, the better your chances of finding some of the good ones.



IJustLikeTivo said:


> If the studios were forward looking, they would invest the money to pay people a small salary to just write. If these people worked on a different up front plan till they were good, the odds are that if they front load enough writer's they'll find enough cream to rise to the top.


But neither of you have addressed the issue of getting people to the industry in the first place. The studios would still have to identify the few out of the thousands in which to invest -- they would have to shoulder that risk, which they are not willing to do.



IJustLikeTivo said:


> This was the old system under the studios before stars got sufficient strength to break that mold. Throught most of the century into the 60's actors, writers etc were hired to work on anything the studio wanted and they turned out tons of stuff. Some good, some bad, some cult classics. But, the point is they did a lot of stuff and slowly they learned their craft. As they did better work, they got better roles or they got to write better movies.


This is antithetical to "fresh blood," and in fact it was *much* harder for new talent to break in under the old studio system. One the studio takes a risk on that screenwriter to put in this sort of training program, they would then have to invest in that person for a fairly long period of time. As that investment increases, so too will the ability/willingness of the studio to discard that investment and look to somebody else.


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> Sometime I really think the old studio systems were better. Less really big hits but more so so stuff. Rant over.


Actually, as I watch something this morning with my daughter, we have at least one modern day version of the old studio system, at least in Television -- the Disney Channel. Just like the old studios, Disney selects a few potential young stars very early on, locks them into fairly long-term contracts, and then places them in low-budget fare. As certain stars prove themselves, Disney nurtures them, begins to market them more progressively, and places them in progressively more expensive projects. As the budgets of those programs increases, so does their safety level. Disney Channel has proven that, for young viewers at least, this formula can still be profitable, for the studios, if not the talent. As such, there may even be a business argument for using that system, from the studios point of view. However, whatever their other virtues, shows from Hannah Montana to Wizards of Waverly Place are incredibly formulaic. I understand why; they have to be under a system where the studio shoulders all the risk. It is hard, however, to argue that such a system can produce risk-taking, vibrant, fare when all the risk is in the hands of those least willing to take chances.


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## IJustLikeTivo (Oct 3, 2001)

Fassade said:


> This is antithetical to "fresh blood," and in fact it was *much* harder for new talent to break in under the old studio system. One the studio takes a risk on that screenwriter to put in this sort of training program, they would then have to invest in that person for a fairly long period of time. As that investment increases, so too will the ability/willingness of the studio to discard that investment and look to somebody else.


I don't think that's true. When you look back, they hired lots of people. Thousands of actors were under contract. They went to local schools and universities and hired people green as grass if they had any potential. They did the same for artists and writers. Just hired gobs of them to let the sieve of work find the gems. Call it the brute force method. Kind of like wildcatting in the old days. You drilled a lot of dry holes but when you struck oil it was worth the trouble.

Oils is more like Hollywood these days too. They spend a lot more money to be sure they drill in the right place. More money up front but a better chance of success.


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## Fassade (Apr 8, 2004)

IJustLikeTivo said:


> I don't think that's true. When you look back, they hired lots of people. Thousands of actors were under contract. They went to local schools and universities and hired people green as grass if they had any potential. They did the same for artists and writers. Just hired gobs of them to let the sieve of work find the gems. Call it the brute force method. Kind of like wildcatting in the old days. You drilled a lot of dry holes but when you struck oil it was worth the trouble.


But why would you pay to drill thousands of holes when you can have others pay for all the derricks?

How world you incent the witers to transfer rights to you without paying them a lot up front?

How would you hire gobs of them when you have to pay a lot up front?

Brute force does not work when the up front cost is high. Any rational business owner would tell you that the higher the up front cost, the more carefully you must pick your targets. Residuals are the very means that allow studios to take a look at gobs of writers.


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## alyssa (Dec 7, 2003)

fyi
Talks Restarted At Agent Bryan Lourd's Home After Weeks Of Quiet Backchannel

http://www.deadlinehollywooddaily.com/update-talks-restarted-at-bryans-home/

Also there was "Force Majeure" letters sent. I'm a bit clue less as to the significance of these perhaps Vito would be so kind as to explain the significance of these letters? Please?


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## Neenahboy (Apr 8, 2004)

alyssa said:


> http://www.deadlinehollywooddaily.com/update-talks-restarted-at-bryans-home/


Dear God, they should try learning the concept of short paragraphs for easy computer screen reading. :down:


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## busyba (Feb 5, 2003)

alyssa said:


> Also there was "Force Majeure" letters sent. I'm a bit clue less as to the significance of these perhaps Vito would be so kind as to explain the significance of these letters? Please?


It's a formal notice by the studio that they are invoking the Force Majeure clause of their contract with the actor (or whomever) they are sending the letter to. The clause allows either party to declare themselves free from the obligations of the contract, in the event of an extraordinary circumstance beyond their control (in this case, the strike) which prevents either party from fulfilling the obligations of the contract.

http://en.wikipedia.org/wiki/Force_Majeure


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## IJustLikeTivo (Oct 3, 2001)

Neenahboy said:


> Dear God, they should try learning the concept of short paragraphs for easy computer screen reading. :down:


Well, it would help if they had any idea how to write in the first place. Format or no format, that was horribly written. It's utterly beyond me how that person makes any money writing.


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## Fassade (Apr 8, 2004)

I am not a lawyer, but I thought Force Majeure could only be invoked when an event occurred totally outside the party's control, and that event could not reasonably have been predicted at the time relevant contract was signed, in which case the circumstance needed to have been accounted for in the contract. Even if you grant the studio was 100% innocent in the origins of the writers' strike, based on the rather bitter history between the two parties, I would think some manner of labor dispute (strike or lockout) in 2007 would have been a foregone conclusion.

Then again, not only could I be wrong, but entire careers have been made debating the precise meaning of the word "reasonably"


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## marksman (Mar 4, 2002)

I think their argument is it is outside their control. A union could strike for any reason and cause them to shut down. It is not a given that the Producers could reasonably end any strike if they wanted to...

I suspect they have done this before and it has held up.


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## Fassade (Apr 8, 2004)

I am sure that is the studios' argument. However, a 20-year contract expired this fall, and, given that there has been some form of labor dispute every time a long term contract expired with any of these unions, I would bet the actors/grips/etc who receive these notices will counter-argue that a dispute this time around during this time frame was easily foreseeable.


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## busyba (Feb 5, 2003)

It all comes down to the way the clause is worded in those particular contracts.


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## Rob Helmerichs (Oct 17, 2000)

Fassade said:


> However, a 20-year contract expired this fall...


I can't remember the exact length, but the contracts run two or three years.

It's been twenty years since the last strike, but plenty of new contracts since then without strikes.


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## Fassade (Apr 8, 2004)

Rob Helmerichs said:


> I can't remember the exact length, but the contracts run two or three years.
> 
> It's been twenty years since the last strike, but plenty of new contracts since then without strikes.


My mistake; you are absolutely correct. I mixed up the residuals discussion with the length of the contract itself.


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## cwoody222 (Nov 13, 1999)

How come shows like Best Week Ever and The Soup were on this weekend? Surely they have writers...


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## muggum (Sep 5, 2003)

Would comment. But on strike.

My picket sign: 'Joke's on them. I like to procrastinate.'


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## Langree (Apr 29, 2004)

muggum said:


> Would comment. But on strike.
> 
> My picket sign: 'Joke's on them. I like to procrastinate.'


:up::up:


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## busyba (Feb 5, 2003)

cwoody222 said:


> How come shows like Best Week Ever and The Soup were on this weekend? Surely they have writers...


Maybe those shows are not union shows?


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## DevdogAZ (Apr 16, 2003)

muggum said:


> Would comment. But on strike.
> 
> My picket sign: 'Joke's on them. I like to procrastinate.'


That's classic. Hopefully with the strike, you'll have more time to contribute here. We'd love to hear what you have in the pipeline.


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## mwhip (Jul 22, 2002)

take it with a grain of salt but it may be over soon:

http://www.deadlinehollywooddaily.com/dare-we-hope-a-deal-has-been-struck/


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## alyssa (Dec 7, 2003)

I am hopeful but in the words of Anon writer


> They [AMPTP] pretend (again) like there's an outline of an agreement to be had, but meanwhile they have spent the past weekend figuring out how to walk away from the table and blame us for the breakdown, in a way they are convinced will stick. Things can't get much worse for them and it wouldn't be surprising if the moguls get rid of Nick Counter as soon as the strike is finally over, so there's nothing for their side to lose by trying this.
> 
> They are Lucy with the football and we are going to fall for it again.


The deal remains to be seen


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## Neenahboy (Apr 8, 2004)

mwhip said:


> take it with a grain of salt but it may be over soon:
> 
> http://www.deadlinehollywooddaily.com/dare-we-hope-a-deal-has-been-struck/


Was reading about these backchannel talks last week. People were optimistic, and there haven't been any end-of-day press releases from either side yet, which is good. Hopefully this is the strike's last week so we can salvage the pilot season schedule.


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## mwhip (Jul 22, 2002)

Neenahboy said:


> Was reading about these backchannel talks last week. People were optimistic, and there haven't been any end-of-day press releases from either side yet, which is good. Hopefully this is the strike's last week so we can salvage the pilot season schedule.


Screw pilot season we need to save Lost!!!! I have waited long enough I don't want to wait until next fall or even worse 2/09.


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## nrrhgreg (Aug 30, 2003)

At least Lost will be back at some point if the strike keeps going. It needs to end so the last 6 episodes of Scrubs can get done and all the diehard fans can get a proper series finale. If this thing messes up the ending of Scrubs someone will pay.


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## smak (Feb 11, 2000)

mwhip said:


> Screw pilot season we need to save Lost!!!! I have waited long enough I don't want to wait until next fall or even worse 2/09.


I think they'd show the 8 Lost Episodes as scheduled. They'd just move the other 8 until next season and have a full season.

I think Lost is pretty safe schedule wise since they have time to use next season.

-smak-


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