WGA – Writer's Strike and the Cost of New Media

I’ve been watching the Writer’s Guild of America strike with some interest through the reporting from Nikki Finke’s Deadline Hollywood Daily since before it went into effect but haven’t had reason to bring it up here until today.

In case you aren’t familiar with what’s going on, essentially all of the people who write scripts for television and movies are currently on strike over a contract re-negotiation that isn’t getting them what they want. The biggest points of contention are:

  1. Writer’s want their take from DVD sales to increase.Currently writers see .3% of DVD residuals for the first million dollars in reportable gross, and .35% of takings after that mark. Writers feel that producers negotiated these numbers when production costs were much higher, and now the writer’s share should be revalued.
  2. Writer’s want to see money from digital downloads and streaming, specifically a 2.5% share.This is apparently more important to the WGA than the DVD thing, because they are quite accurately predicting that downloads of some kind will be the most profitable and most important area to gamble their livelihood over. If you read this intriguing analysis by Jonathan Handel at the Huffington Post, you’ll read about him peering into the future of 3D entertainment.

The Alliance of Motion Picture and Television Producers (AMPTP) are the ones going up against the WGA on this and from what I’ve seen on the web and in print, they aren’t handling it very well.

Nick Counter, the president of the AMPTP said in an interview with TV Week that producers are “…not going to negotiate with a gun to our heads—that’s just stupid.” But the AMPTP members most certainly are feeling the pressure as the only thing the public understands is that their favorite shows are in re-runs and that is a good reason to do something with their lives other than consume media.

Today the ability for the AMPTP portray themselves in a positive light took a new turn for the worse as the WGA began offer a series of internet videos that (for the time being) are being released on Nikki’s blog. You can read about the effort here, or check out the following three that have been released so far: Holly Hunter, Richard Benjamin, and finally Sean Penn.

While inconvenient for the public at-large, this strike is having the immediate affect of forcing many people to take a hard the fact that digital distribution isn’t just going to grow, it is going to explode.

The WGA clearly sees the internet as the primary delivery mechanism for the future of media and are doing something about it now–even at the sacrifice of a greater share of the $26 billion DVD market. The fact that the AMPTP won’t concede on this particular point shows that they feel the same way.

The contract between the WGA and the AMPTP is renegotiated every three years, so I would guess that the WGA will settle for less than a doubling of their DVD take–but it might still be a mistake to give ground on the digital distribution.

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