Money -- not creative rights -- was sticking point

Optimism took a drubbing last week in Hollywood as six weeks of contract talks between writers and studios collapsed, confirming pervasive fears of crippling strikes in the summer.

Leaders of both sides sought to cool strike fever by proclaiming that a deal can still be worked out before the Writers Guild of America contract expires May 2.

But the sudden termination of talks on March 1, with no date set for resumption, will undoubtedly accelerate the industry’s already frantic production pace as it seeks to stockpile movies and TV shows to ride out a work stoppage.

Not surprisingly, money rather than creative-rights issues proved to be the undoing of the negotiations.

“We want to be paid more than they’re willing to pay,” says WGA West prexy John Wells; “We are so far apart on the economic issues that we think there’s no way to bridge the gap,” says Nick Counter, prexy of the Alliance of Motion Picture & Television Producers and the producers’ lead negotiator.

The AMPTP accused the WGA of walking away from the table, but Wells says both sides had agreed that the WGA’s leadership needed to take a breather and communicate with its 11,500 members. Wells said talks would probably resume in April.

In a troubling sign, the two sides disagreed on the size of the gap between them.

The AMPTP claimed its final offer was equivalent to a $30 million pay hike over three years while the WGA was seeking $112 million; the Guild said the AMPTP’s offer represented an overall pay decline of $2.7 million while the WGA’s last bid was a $100 million hike.

While the amounts don’t seem that large compared to what an A-lister like Jim Carrey pulls down for a single film, the implications are huge.

Counter and a trio of CEOs — Disney’s Robert Iger, DreamWorks Jeffrey Katzenberg, Warner’s Barry Meyer — stress that whatever deal they make with the WGA will have a direct impact on subsequent deals with the Screen Actors Guild, the Directors Guild of America and the Intl. Alliance of Theatrical Stage Employees.

“When you multiply it across the board, it’s hundreds and hundreds of millions of dollars,” Katzenberg says.

The general rule is that whatever the WGA is able to gain in residuals, SAG will receive about three times that amount. The WGA has already shrunk its residuals demands from $161 million to $60 million; it claims that the AMPTP’s proposal for free second reruns within a 14-day period amounts to a $31 million cut in residuals.

With no new talks set, the focus will be on two groups — the WGA rank-and-file writers, who have to date remained supportive of Wells, and SAG, which carries the clout to completely shut down production if it has no deal by its June 30 contract expiration. The actors have not scheduled a start date but are expected to be ready in early April.

At the WGA’s news conference, SAG prexy William Daniels expressed disappointment over the suspension of talks and continued to insist that strikes are not inevitable.

But SAG insiders were angered by what they perceive as an exceptionally hard line by companies on residuals, noting it resembles the rhetoric from advertisers last year during SAG’s six-month strike.

“The companies are delivering the same old line — how poverty-struck they are,” one SAG board member says. “We didn’t believe it then and we don’t believe it now.”

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