Thesps’ ad-vantage

Member earnings from commercials up 10%

HOLLYWOOD — With negotiations on its ad contract less than two months away, SAG’s first-quarter member earnings for commercials have jumped an impressive 10% over the same quarter last year.

The new figure is likely to carry a mixed impact when negotiations start after Labor Day. SAG and AFTRA are likely to contend that the gains of the current contract should be built upon, based on “custom and practice,” while advertisers will probably argue that the increases have hobbled their ability to give anything more.

Thesps are also likely to cite the seemingly strong state of the ad industry based on Madison Avenue’s pledge of at least $9.2 billion to the six webs next season during this spring’s upfront sessions. That was up $1.1 billion from last year’s figure and better then expected amid the fragility of the nation’s economy.

The January-March total of $174 million — based on contributions to the SAG pension and health plan — continues last year’s recovery in commercial earnings from depressed levels caused by the six-month strike in 2000 and the downturn in advertising in 2001. The 2003 number — $16 million ahead of the 2002 quarter and $26 million over the 2001 quarter — nearly matches the $175.5 million in the pre-strike period of 2000 when the ad industry stockpiled in anticipation of a strike.

Initial proposal

Reps of SAG and AFTRA have already hammered out an initial proposal for the negotiations but not disclosed any details. SAG and AFTRA’s national boards are set to review that proposal in a joint confab on July 20.

Sources believe thesps are seeking a relatively modest 4% annual increase in minimum rates, possibly reflecting the desire to avoid repeating the aggressive stance at negotiations that led to 2000’s six-month strike against the ad industry. Formal talks are slated to begin Sept. 3, with the current pact expiring Oct. 29.

Although neither union has yet released figures, combined SAG and AFTRA member earnings on ads during 2002 topped $700 million, with SAG contracts accounting for about 90%. That number is significantly higher than figures from 2000 and 2001.

Strike value debated

SAG members have continued to debate the value of the 2000 strike, the longest in Hollywood history, and benefits from the three-year deal.

Key points in the 2000 pact included retention of network residuals; setting aside $1 million annually to develop a monitoring system; fees of $1,500 a year for Internet ads; and impressive hikes in the quarterly cable buyout rates to $1,390 in the first year, $1,706 in the second and $2,460 in the third.

The monitoring system, which became an issue after SAG released a 1999 study asserting that 18 of 30 commercials had shortchanged actors by $388,000, has not been developed.

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