Writers, producers reach deal

Deal still requires members' endorsement

HOLLYWOOD — With a cliffhanger plot worthy of a summer blockbuster, Hollywood screenwriters and studios reached a tentative 3-year deal this afternoon.

Negotiators at Writers Guild of America West headquarters in Hollywood had confabbed for three days after the expiration of the WGA pact at 12:01 a.m. on May 2.

A press conference is scheduled for around 4 p.m.

At press time, no official announcement had been made regarding a settlement, but well-placed sources said that package included an increase in residuals paid by the Fox Network from a current 66% of the rates paid by the Big Three nets to 100% in the contract’s second year.

The deal also includes an increase in the residual payments for sales of DVDs.

The studios agreed to drop their demand for a “double burst” discount on second airings of TV programs within a 14-day window. The WGA had said that the proposal would have cost them $31 million over three years.

The package includes no increase in basic cable residuals, an area where the WGA had sought a $4.2 million bump. The writers also dropped their demand for limits on the possessory credit.

The willingness of producers to go past the contract expiration date had fueled a wave of optimism mid-week, even as the WGA repeatedly denied published reports that a tentative agreement would be reached.

The deal, whose details were not revealed by negotiators at press time, still has to be endorsed by the 11,500-member WGA, which spurned a tentative agreement four years ago.

Guild leaders promised over the past year that they would be more aggressive at the bargaining table, but an news blackout surrounding the week’s negotiations left Hollywood chasing rumors as to how a final deal would be crafted.

The roller-coaster week featured several sessions that went well past midnight and several points at which talks nearly collapsed. Much of the town’s routine business at studios and talent agencies came to a near-standstill as execs and below-the-liners waited for developments.

The WGA told members during the days following the old contract’s expiration that under federal labor law, the old pact remained in force while talks continued.

Optimism surged May 2 with the arrival at the talks of several studio toppers, including DreamWorks’ Jeffrey Katzenberg, CBS’ Leslie Moonves, Fox’s Tom Rothman, Warner’s Alan Horn and U’s Stacey Snider.

The tentative agreement reached May 4 came relatively quickly following the old contract’s expiration and countered the pessimism that had drenched Hollywood following the March 1 collapse of talks. That round of negotiations had lasted six weeks and were followed by vows from both sides that they would not “meet in the middle” of the $100 million gap between offers.

For the last few weeks, negotiators had found particularly tough going on the issues of the WGA’s demands for hikes in residuals for video/DVD, foreign TV, basic cable and Fox Network, along with some kind of Internet jurisdiction.

Reps for both sides had shown much more hopefulness that the WGA’s creative-rights demands, such as improved access to sets, could be sorted out.

Should the writers ratify the nascent deal, many believe the Screen Actors Guild and the American Federation of Television & Radio Artists will follow suit prior to their June 30 contract expiration.

The actors unions, which placed Hollywood on alert last year with a six-month strike against advertisers, are tentatively set to begin talks with producers May 10.

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