Two-year pilot checks revamp based on ratings

PricewaterhouseCoopers has started a two-year pilot study for the ad industry, SAG and AFTRA to test a revamp of compensation for thesps in commercials that would be based on ratings rather than the current pay-per-play model.

The study was commissioned as part of the three-year deal reached last spring between the industry and the performers unions. Doug Wood, chief negotiator for the industry and a partner at Reed Smith, disclosed the launch in a memo sent this week.

The pact, which covers about $900 million in annual blurb work, maintains the current method of pay-per-play payment for ads run on network (also known as the “Class A” payment structure). The ad biz had hoped to shift the payment to a formula based on ratings for blurbs rather than plays but settled for a pilot study instead.

Wood said in the memo that PricewaterhouseCoopers will evaluate the Gross Ratings Point Talent Compensation Model, which was created by Booz & Co. two years ago as part an agreement between the unions and the industry. The company will also conduct a 52-week study comparing talent compensation under the new model against results under the current system.

SAG and AFTRA staged a bitter six-month strike in 2000 against the ad industry, but last year’s shift in control of SAG’s national board made another strike unlikely. The unions reached a deal April 1, a few hours after the expiration of the previous pact.

The new deal provides that the unions are obligated to start bargaining on the results of the pilot study by October 2011 — six months prior to the expiration.

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