The plethora of new digital delivery systems vying for wide-scale adoption presents a massive headache for the three major Hollywood talent guilds, which are girding for negotiations with the studios and networks.
And with the next round of labor negotiations looming this summer for the Writers Guild of America, concerns are mounting that determining compensation rates for the various new platforms will make bargaining tough.
It’s tricky turf.
The guilds, which usually have only general contract language in their minimum basic agreements, have been able to present an occasional united front on a few prominent digital deals, such as Disney’s plan to sell TV shows through iTunes.
Guild officials want members to be compensated at pay TV rates, which are four times higher than those for homevideo. Disney subsequently paid at the homevid rate.
However, the guilds scored a notable victory in April when they reached an agreement with Touchstone Television on ABC’s “Lost” spinoff for mobile phones, negotiating residuals at the pay TV rate.
Going into negotiations for new contracts, here’s how each guild is prepping for the digital revolution:
WRITERS GUILD OF AMERICA
WGA West prexy Patric Verrone says his guild has upped its research over the past year with an eye toward sorting out how members should be compensated in several areas: reuse of their work in content including downloads; new work in made-for-the-Internet productions; and promotional labor.
It named its 17-member negotiating committee last Tuesday with such heavyweights as Neal Baer, Marc Cherry, Bill Condon, Stephen Gaghan and Terry George agreeing to serve. Negotiations will probably start in July.
Both Verrone and WGA East prexy Chris Albers insist that their decision to bypass early negotiations doesn’t imply that a strike is planned. Both believe the WGA will be in a better position to negotiate five months from now once its research is completed.
“I resent the companies fanning those flames about a strike,” Albers says. “We don’t want to be told at negotiations that these areas aren’t covered, so we’re going to get zero.”
SCREEN ACTORS GUILD
SAG surprised Hollywood last summer when it agreed to a proposal by the ad industry for a two-year extension of its commercials contract. The basic premise was that the digital delivery platforms had so muddied the outlook for future revenue that a consultant would be needed to sort everything out and propose a new framework for compensating actors in commercials.
To many, it showed a willingness to act pragmatically under the leadership of president Alan Rosenberg, who was elected in 2005 on a platform that promised more aggressive bargaining.
But as of early February — six months after the extension was agreed to — the consultant still hadn’t been named.
Operating under its fourth exec director in less than two years, SAG’s also awaiting the results of a membership referendum that would bolster — among other enterprises — a new technologies department with as much as $7 million in additional annual revenue.
SAG leaders say the funds are crucial to begin negotiations on a new film-TV contract to replace the current deal, which expires June 30, 2008. Ballots are due Feb. 15.
“Actors — especially our high-profile members — are painfully aware of how they’re often not compensated adequately in new areas of technology,” Rosenberg says.
DIRECTORS GUILD OF AMERICA
The DGA is widely viewed as the most pragmatic of the guilds and the least likely to go on strike — particularly in light of past history.
SAG’s last strike was a six-month walkout against the ad industry in 2000; the WGA’s last work stoppage was in 1988 and lasted five months, delaying the fall TV season; the DGA’s only strike came in 1987 and lasted all of five minutes.
DGA prexy Michael Apted says the guild has paid a great deal of attention to digital delivery issues recently and will spend much of this year formulating proposals for the bargaining table.
“We’re just becoming aware of the issues,” he admits. “New media gets a lot of attention, but old media is still very much with us. And there’s also the relationship between pay and free TV and whether people are willing to buy stuff on their iPod and cell phones.”
Even though its current film-TV pact doesn’t expire until summer 2008 (right next to SAG’s), it’s possible that the DGA could launch talks as early as this fall if the WGA can’t make a deal. That’s what happened in 2004, when the WGA couldn’t make studios and networks budge on the two-decade-old DVD residual rates.
The DGA then tried to push DVD residuals and came to the conclusion that there were only three options: accept a deal that included significant gains in health and pension contributions; go on strike; or agree to a revolutionary restructuring of the entire residuals system that would be based on recoupment formulas, under which the most successful shows would probably receive even more residuals than now.
The DGA decided on the first option, and the WGA signed a deal two months later. SAG followed suit four months after that.