Sides no longer talking

Hollywood’s holding its collective breath about a writers strike as prospects for a last-minute deal evaporated.

Some 12,000 WGA members could go on strike as early as today. But the emerging consensus was that the official start of the work stoppage would be at 12:01 a.m. Monday.

Waiting until after the weekend would enable the WGA to hit multiple locations with pickets on Monday morning and notify members of the Teamsters — the only Hollywood union that’s told individual members that they should honor picket lines. It would also allow the WGA to assert that it had given the Alliance of Motion Picture & Television Producers one last chance to revamp its proposals.

Guild leaders were set to announce their plans at a Thursday night membership meeting at the Los Angeles Convention Center. The WGA East has scheduled leafleting for this morning at Rockefeller Plaza in Gotham.

Hopes for a settlement cratered Wednesday night — a few hours before the WGA contract expired — amid bitter recriminations from both sides. The meltdown occurred when companies demanded that the WGA drop its demand to increase homevid residuals, prompting guild negotiators to leave without any indication when — or even if — they’d return.

WGA strike captains began instructing guild members to take their personal items home from offices at the end of work Thursday.

Nick Counter, president of the Alliance of Motion Picture & Television Producers, said the companies believe they can make a deal by moving on other issues but insisted that increasing the DVD formula is a nonstarter. The WGA accused the companies of being unresponsive toward a compromise package of proposals, though it declined to provide details.

The DVD dispute centers on the 1985 formula, under which homevid residuals were paid on the basis of 20% of wholesale revenues — which equates to scribes receiving about 4¢ for each disc sold. The WGA wants to double that rate, asserting it agreed to a discounted deal two decades ago to help the fledgling business survive, while the studios and nets have nixed any boost to DVD residuals, contending the revenues are crucial to moving film and TV projects out of deficit amid sharply rising costs.

The WGA’s compromise was believed to have included keeping the current DVD rate in place for discs with less than $1 million in sales, but no further details were available.

The impact of a strike would be felt most immediately on latenight TV, with scripted shows getting hit in a couple of weeks. But once the WGA strikes and starts picketing, the town’s focus will shift to the start of negotiations between the Directors Guild of America and the AMPTP.

Though the DGA’s current contract won’t conclude until June 30, the directors tend to start their talks at least six months prior to expiration, and it’s widely expected that talks would begin in the next few weeks. The DGA’s leaders indicated last month that the guild was nearly ready to start bargaining.

Jim Johnston, a partner specializing in entertainment business at the New York firm Davis and Gilbert, said the prospect of a DGA deal that addresses thorny issues such as new-media compensation will undercut the WGA’s position. “If the DGA can get analogous issues resolved, that’s going to put a tremendous amount of pressure on the WGA,” he added.

Support for the WGA from the other Hollywood unions has been tepid — except for the Teamsters, who have over 4,000 drivers, location managers and casting directors through Local 399. Three days after Local 399 secretary-treasurer Leo Reed urged those members to honor WGA picket lines, the notion received a ringing endorsement from national president Jim Hoffa.

“I encourage the members of WGA to stand strong and fight for what you believe is right and fair,” he said. “The Teamsters support your cause. Without the content these proud union members provide, the television and motion picture industry would come to a grinding halt.”

Hoffa noted that although Teamsters are contractually bound to continue to work active productions if the WGA does go out on strike, each and every Local 399 Teamster has the right to honor any picket line if it is raised at their place of employment without fear of reprisal from the studios.

“If there is one thing that can be said about the 1.4 million Teamsters across this country, it is that our union is one that believes in strength through solidarity,” he added.

CBS topper Leslie Moonves told analysts and investors Thursday that he was not worried about a strike.

“We are prepared with a full slate of firstrun programming now and at midseason,” Moonves said in a conference call about third quarter earnings. “The bottom line is this: In the event of a strike, we anticipate no material impact on the company for the remainder of the season.”

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