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Writers’ residuals rise 22%

Increase due to industry boom, enforcement efforts

With strong gains in most areas, writer residuals rose 22% last year to $178 million, the Writers Guild of America has reported.

The organization said the record increase stemmed from heightened enforcement efforts and the current boom in the entertainment industry, leading to higher license fees and advertising revenues, acquisitions of content-based assets and expanded distribution requiring more shows.

The WGA disclosed the figures in the current issue of its “Written By” newsletter. The org asserted that the share of revenues writers and other talent receive continues to fall short of the overall growth and expansion in the U.S. entertainment industry. The guild, which is gearing up for contract negotiations in anticipation of its three-year pact expiring in May 2001, called for an across-the-board adjustment in residual formulas.

The union noted that residual payments for basic cable, which rose 67.1% to $12.7 million, represent a “systemic underpayment” compared with cable’s overall profits. It noted that cable TV is reusing large blocks of “residual free” product since writers often do not receive basic cable residuals for TV product produced before 1977 or for most films produced prior to 1960.

Network and domestic syndication rose 22.4% to $61.3 million, with $4 million of the increase due to syndication fees paid by the Pax Network for reruns of 10 series. Foreign free-TV residuals for TV programs increased 23.7% to $21.9 million.

Films generated a 15.7% rise for domestic and foreign TV showings while video and pay TV fees increased 18.2% to $53.2 million, with the latter spurred in part by the emergence of DVD. The WGA noted that the gains from video are much lower for writers than for distributors because of lower manufacturing costs.

The union more than doubled collections for disputed claims and slow payments to $5.06 million for 295 claims in 1999 from $2.08 million for 199 claims in 1998. The WGA legal department resolved cases resulting in $1.02 million in payments last year.

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