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WGA Negotiations Set Stage for Streaming Giants to Have Bigger Role

The haggling that led the Writers Guild of America and major studios to the razor’s edge of a strike reflected the many changes in the scripted TV production landscape in just the three years since the sides last met for contract negotiations. It also codified in the industry’s Magna Carta — the WGA’s 671-page master film and TV contract — the paradigm-shifting influence of streaming giants Netflix, Amazon and Hulu.

The most complicated issue tackled in the talks was adjusting the compensation formula for writers who work on short-order series — shows that run
fewer episodes per season than the 22-24 episode norm of broadcast TV series. (The “short-order” nomenclature alone is indicative of a changing market.)

The proliferation of such series has put a big crimp in the paychecks of writers, who are usually paid a per-episode fee. Adding to the hardship is the tendency of streaming services — as well as some cable outlets — to hold shows for months after production is completed before they premiere, making standard exclusivity clauses in contracts onerous for writers trying to fill the income gap.

The new formula agreed to in the contract negotiations that went down to the wire in the wee hours of May 2 is recognition that the streaming model has taken root. This also sets the stage for Netflix and Amazon, with their voracious appetite for programming, to become bigger voices in the AMPTP, the negotiating body for the major studios.

Amazon is a member of the AMPTP; Netflix is not. Both outlets still buy most of their programming from outside studios, although that may well change in the coming years. The deal that eased the tension over short-order series was hammered out by AMPTP president Carol Lombardini and the labor executives for the largest studios, most of which had also been exposed to the challenges that the WGA sought to address.

Amazon declined to comment. But others praised the outcome of negotiations that were tense but ultimately productive. WGA negotiating committee co-chair Christopher Keyser, a veteran showrunner, was cited as an important voice in the room given his experience in moving from traditional network TV to the cable and streaming model.

Said FX Networks CEO John Landgraf: “We’ve been trying to deal with [shorter orders] on an ad-hoc basis to find solutions for our writers. We’re really glad the writers raised it as an industry-wide issue and glad the producers took it seriously enough to create a structure to address it.”

Notably, the accord that spared the industry the pain of a strike was pulled off with some behind-the-scenes diplomacy from the CEOs of two companies who are primarily invested in TV’s traditional model: CBS Corp.’s Leslie Moonves and Warner Bros.’ Kevin Tsujihara. The two — with the support of their peers at Fox, Disney, Sony and Viacom — were mindful of the management-side leadership failures that drove the WGA to its 100-day walkout in 2007-08. Labor peace, after all, is simply good business.

“We were all extremely pleased,” Moonves told CBS investors on May 4. “We felt like the deal was extremely fair.”

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