Studios holding on to money before Oct. 31

With a November WGA strike becoming a more distinct possibility, studios have started putting the hiring squeeze on scribes.

“We’re not financing their strike” is the new mantra for studio and network execs as writers are told that their services won’t be needed until the WGA works out a deal.

The get-tough stance — designed to demonstrate the consequences of a strike to the 12,000 Writers Guild of America members — has emerged as the gloomy town deepens its belief that a strike will take place soon after the Oct. 31 contract expiration.

Tuesday’s talks yielded no progress as negotiators for the WGA and the Alliance of Motion Picture & Television Producers met at AMPTP headquarters in Encino. Following the seventh face-to-face session since July — as part of what’s become an increasingly hostile PR campaign — AMPTP prexy Nick Counter ridiculed the guild’s proposal to boost DVD residuals.

“Today the WGA presented an untenable proposal to double the homevideo residual using specious numbers, a revisionist view of the bargaining history and a complete disregard for the costs and deficits that producers must bear,” Counter said. “When challenged on the questionable figures, WGA West executive director David Young said he would get back to us to break down how they arrived at these conclusions.”

The sides recessed in the late afternoon and were skedded to resume this afternoon. WGA negotiating committee chief John Bowman responded to Counter by saying, “Under the current DVD formula, a writer receives 4¢ for every $15 DVD sold. Our reasonable proposal is to increase our share to 8¢ per DVD. This is far less than the cost of the box the DVD comes in.”

The WGA’s long contended that the current homevid formula is unfair, since costs of manufacturing and distribution have dropped since the current deal was first hammered out in 1985. But companies have insisted they can’t change the formula, asserting DVD revenues are crucial to recouping their losses on feature production.

Agents, execs and producers have started bracing for a strike amid harsh rhetoric, unproductive negotiations and the WGA’s recent move seeking strike authorization from members.

“The WGA’s done a great job of convincing the town that they’re going on strike,” one tenpercenter noted. “My instinct is that both sides are now in their foxholes.”

Several other factors may be pushing studios away from making any deals with writers, such as the recent decline in box office plus the increased production activity to stockpile projects.

“We’re at a time of year where the studios have often spent all or a big portion of their development money,” one prominent producer noted. “There are already far more films in the pipeline than normal.”

In recent days, writers have been notified by studios that verbal commitments for portions of the scripting process have been preemptively canceled.

For example, the time needed for a script polish — usually a four-week process — now falls within the period in which a strike could take place. So at least one studio has been telling writers that it’s no longer under a legal obligation to pay for the polish.

“The sense I get is that the very immediate writing work is still getting done, but anything longer-term is on hold,” another agent said.

Scribes and agents say that execs at Warner Bros., Universal, Fox, Paramount and DreamWorks have all indicated that they’re not interested in making any deals with screenwriters until the WGA reaches some kind of agreement.

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