Despite the disappearance of a major roadblock to a deal, the threat of a writers strike remains strong.
A day after studios and nets removed their polarizing proposal to revamp residuals, there were no signs of movement as the daunting task of crafting a deal acceptable to the WGA and Alliance of Motion Picture & Television Producers remained.
Reps for the WGA and AMPTP huddled in separate meetings Wednesday and did not hold any face-to-face negotiations. With no new date set yet for the resumption of formal bargaining and the WGA’s strike authorization vote concluding late today, talks won’t probably start again until Friday at the earliest.
Hollywood has cheered the AMPTP’s move to remove the residuals proposal as the first positive news from what had been three months of rancorous and unproductive talks. With the AMPTP having made the move, the spotlight’s shifted to the WGA to respond.
But it took months to achieve that progress, so labor watchers are skeptical that there’s enough momentum to reach agreement by the time the WGA’s contract expires on Oct. 31.
Two key questions have emerged among observers: Will the WGA agree to a contract extension in exchange for a multiyear study of compensation, even though it spurned the idea in July? And can the AMPTP sweeten an extension deal enough to get the guild leaders aboard?
At first glance, the answer to both questions would be “very unlikely.” The WGA’s been dismissive of the idea ever since AMPTP president Nick Counter first unveiled the proposal for creation of a jointly funded outside study group in April.
Still, there may be some wiggle room for negotiators, such as reducing the length of the study by a year or two and agreeing in advance to make retroactive payments.
When the AMPTP formally made its initial proposal in July, it contained two parts — a three-year study/contract extension or the residuals revamp with talent being paid only after basic costs are recouped. The WGA rebuffed both ideas immediately, and the AMPTP took the study idea off the table the next day.
Counter’s plan was to generate a report — a sort of showbiz version of the report from the Iraq Study Group headed by James Baker and Lee Hamilton. The basic premise of such a study: Digital delivery platforms have so muddied the outlook for future revenue that an outside expert is needed to analyze the best method of compensating writers.
Companies also wanted to avoid being locked forever into paying residuals on revenue streams for unprofitable operations.
The panel would have been staffed by entertainment industry experts and examine the intricacies of how performers are paid for reuse of their work — both for traditional media and the proliferation of new-media platforms — along with creating formulas that could be retroactive.
Counter noted at the time that there were recent precedents: SAG and AFTRA agreed last year to a two-year contract extension of their commercials contract so an outside consultant could analyze revenue streams; and Canadian performers unions had agreed to hold off on resolution of several new-media issues until they can by studied further.
From the companies’ standpoint, the best-case scenario would also see the DGA and SAG agreeing to similar studies — although SAG topper Doug Allen dismissed the idea as a nonstarter long ago.
But none of the AMPTP arguments for a study have generated any traction so far within the WGA, which has argued that the studios and nets are just making excuses not to pay writers more.
“How can we take an idea seriously that means stalling for three years the bargaining of fair contracts for the people who create and produce the content that makes the entertainment industry so successful?” the guild said in a message to members. “The studios assert that these are new technologies, so they don’t know how any of it will work from a business standpoint. This may be a clever excuse, but as we all know, digital distribution is hardly new.”
The WGA noted that the download-on-demand website Movielink was launched by a clutch of major studios in 2001 and that it’s had a residual formula in place for Internet downloads since November 2001.
During the run-up to negotiations, TV execs such as NBC Universal’s Marc Graboff asserted that the industry needed at least one or two more seasons for a dominant business model to emerge. But the WGA has told its members that there’s no excuse for not paying as long as revenues are coming in.
“The fact that delivery systems are changing, and will continue to change, does not mean that residuals shouldn’t be paid now,” the WGA said. “Collective bargaining can accommodate change.”