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Next stop on highway: TV contract provisions

LAS VEGAS — Next time a local TV station goes into negotiations with a syndicator for a show, or a network negotiates with a studio, look for the contract to go beyond over-the-air distribution and include clauses on the information superhighway.

That’s the strategy of the future, say network execs at the National Assn. of Broadcasters confab. To survive on the information highway and protect their lane, broadcasters need to make sure their programming is exclusive.

“Get as much of the rights as you can to exploit over-the-air product,” said Molly Pauker, Fox Broadcasting’s Washington counsel.

Pauker said the network was alarmed that a video-on-demand test had an agreement with one of Fox’s program suppliers for Fox shows, meaning that viewers in that market don’t have to watch Fox to watch the show. She declined to say who is performing the test.

Conversely, even when a network owns a show, offering it to another medium such as video-on-demand via cable isn’t easy.

Capital Cities/ABC, which is participating in video-on-demand tests with cable programmer Discovery Communications, has found that even if you own the show, you don’t necessarily own the rights to the content.

“There are clearance problems across the board,” said Charlene Vanlier, Washington counsel, CapCities/ABC. “In an episode of ’20/20′ we use movie clips and music that are not ours.” That means the network has to go back to the copyright holder and seek further permission for the use of material, which can get costly.

It’s not limited to program content; news talent also will want extra money if their shows are being offered on services other than the network, Vanlier said. That means that when Barbara Walters starts renegotiating her contract, there could well be clauses giving her more money for any additional distribution of her shows via video-on-demand or similar experiments.

The same holds true for union contracts and residual payments for actors. CapCities/ABC recently put out a video of all the famous soap opera weddings and , according to Vanlier, spent lots of time tracking down old actors for permission and payment.

One of the problems with negotiating for copyright for programming-on-demand, Vanlier said, is that “no one knows what to charge, so they highball it.”

That is why the majority of video-on-demand tests don’t include programming from the Hollywood studios and syndicators but instead rely almost exclusively on owned product from the networks.

Once the programmers and distibutors can come to an agreement on price, the shows will be there. Of course, before that happens, the program producers have to hammer out new terms with their talent that include provisions for ancillary use.

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