Leaders of SAG and AFTRA have agreed with the ad industry on the general outlines of a deal to extend the commercials contract by at least a year in order to conduct a jointly funded study on the fast-changing revenue models for the ad biz.
The extension of up to two years would have to be approved by SAG and AFTRA members.
Officially, both sides announced Tuesday that they had held “full and fair” preliminary discussions over the weekend at SAG headquarters in Los Angeles about the study and the commercials contract, which expires Oct. 29, and had agreed to meet again at a yet-to-be-decided date.
Neither side offered more detail, but several people close to the negotiations asserted that the groundwork has been laid for an extension. SAG and AFTRA leaders are willing to support the study in the face of the recent proliferation of platforms for advertising such as iPods, cell phones, video-on-demand and embedded commercials.
Key details, such as the length of the extension, have not been finalized.
Extending the contract would preserve the current model of paying SAG actors for primetime TV ads via residuals. The ad industry has been floating the idea of replacing residuals with a $19,000 buyout that would cover a year.
The ad industry first asked for a yearlong extension last year in order to perform a jointly funded study of changing revenue models, then announced March 15 that it was going to hire a consultant to perform the study even if the thesp unions declined to participate.
SAG and AFTRA struck against the ad industry for six months in 2000 in a strategy that’s still the subject of bitter debates within the unions. They gained big hikes in cable rates; the strike stopped only after the industry dropped its demand that network TV residuals be replaced by buyouts and SAG gave up its demand for residuals in cable rather than buyouts.
In 2003, SAG and AFTRA agreed to the current deal, which included a hike in pension and health contributions and a gain of 7% over the three years in minimum fees.
Should both sides agree to commission a joint study, it will be conducted by an independent consultant with experience in television, radio and labor relations.