Amid fears that the resumption of talks between scribes and the studios would be openly hostile, Tuesday’s session proved surprisingly smooth — but there are still key differences between the two sides and there are mounting fears in the biz that time is running out.
Negotiations, which re-launched in the ayem in Los Angeles following a four-day break, recessed in the early evening and will resume today.
Tuesday’s talks focused mostly on Web streaming as the Writers Guild of America presented a counteroffer to last week’s proposal by the Alliance of Motion Picture & Television Producers. A source close to the talks described the sesh as encouraging and more productive than previous sessions as writers presented their tiered usage plan.
However, the WGA said the AMPTP’s math was deeply flawed when the companies estimated that scribes would see a $130 million increase in total compensation over three years. The writers concluded it would be more like $32 million.
Part of the problem is that the producers have not revealed their methods for estimating these figures — and scribes are innately suspicious of Hollywood bookkeeping.
But when the WGA presented its counterproposal, the studios and nets offered conceptual questions about structure and measurement of streaming usage — in other words, they didn’t reject the proposal out of hand.
One source described the queries as being respectful and, in another sign of possible progress, reps for both sides discussed the proposal informally at a sidebar.
The WGA’s proposal — based on how many times a program is viewed — for Internet streaming of TV dramas came in response to the fixed annual $250 residual offered last week by the AMPTP.
As has been the case in recent sessions, CAA partner Bryan Lourd attended the huddles, which were held at an undisclosed location.
The skepticism about the AMPTP’s numbers — and the question of the $100 million discrepancy — were contained in a report to WGA members released during the negotiating session by negotiating committee chief John Bowman. The report was described as taking a “comprehensive” look at the overall WGA and AMPTP proposals.
In response, the AMPTP simply repeated its own conclusions. The companies said they’re sticking by their numbers, adding, “The New Economic Partnership presented by the AMPTP represents a gain of $130 million for writers over the next three years based on projected increases in compensation, benefits and residuals including new media. This is on top of the annual $1.3 billion in payments they currently receive.”
One industry vet, who has been plugged in to the negotiations, said the exchange shows that the sides are “not even speaking the same language” in their volleys on complex issues like new media residuals and guild jurisdiction for original material produced for the Internet.
Such disagreements likely will try the patience of CEOs of AMPTP’s congloms and may push them to make a “last, best, final” offer to the WGA within the next week or two. And if the WGA rejects that deal, the AMPTP likely would launch negotiations shortly thereafter with the Directors Guild of America.
Still, Bowman struck a mildly conciliatory tone in his report.
“So while we don’t see how their proposal adds up to anywhere near $130 million, we greet their public willingness to make such an offer with real interest,” he said. “If the AMPTP is serious about this figure, the WGA is confident we are closer to a deal than anyone has suggested, and we are hopeful that the companies will respond positively to our proposal, which is a serious, reasonable, and affordable attempt to bridge the gap between us.”
One exec said company toppers are frustrated over the continued inability to find common ground. Key areas of disagreement remain on non-economic issues such as the WGA’s demand for jurisdiction over original programming for the Internet, as companies have offered only to grant jurisdiction to derivative programming.
CBS topper Les Moonves issued a downbeat forecast Tuesday.
“I’m hopeful but not terribly optimistic,'” Moonves said at a UBS AG media conference in New York. “We are far apart at this point. Digital media remains the key component.”
The guild’s numbers also showed the sides remain nearly $120 million apart on economic terms. It calculated that the companies would have to pony up an additional $151 million hike over three years if they agreed to the guild proposal.
The guild costs break down to $33 million in the first year, $50 million in the second year and $68 million in the third year — a “modest” 3.9% annual increase — with the top gains coming in Internet re-use ($88 million) and minimum increases ($29 million).
The WGA also noted that since 2000, entertainment segment revenue for employers has grown from $63 billion to $95 billion for an annual growth rate of 7%.
The report also warned that the AMPTP’s streaming proposal won’t work in its current guise.
“If you factor in their regressive proposal on ‘promotional use’ (streaming TV shows and feature films in their entirety for free) writers could potentially lose $100 million in income over the course of this contract,” the missive said. “So we call on the AMPTP to provide specifics on how this ‘New Economic Partnership’ would truly benefit writers.”
With the strike about to enter its second month, picketing continued at all major lots Tuesday in Los Angeles with temps reaching into the 80s. And in New York, where temps were around freezing with snow squalls, almost 300 strikers braved the cold to picket in front of News Corp.’s HQ.
Among those on the picket line in Gotham: Barry Levinson, Tom Fontana, Richard Belzer, Seth Meyers, Warren Leight, and members of the writing staffs of latenight shows including “Saturday Night Live,” “Late Show with David Letterman,” “Late Night with Conan O’Brien,” “The Daily Show with Jon Stewart” and “The Colbert Report.”
Terry George, screenwriter and a WGA East rep on the negotiating committee, offered an update on the negotiations at the rally.