The WGA responds to its membership

The WGA sent the following email to its members on Friday afternoon:

Fellow members:

There are a lot of rumors and questions floating around, and we’d like to address them.

HAVE NEGOTIATIONS BROKEN DOWN? No.

DID OUR NEGOTIATING COMMITTEE ASK FOR A BREAK? No.

THEN WHY THE FOUR-DAY BREAK? On Thursday, the studios and networks gave us some of their proposals, and said they needed more time to fashion the rest. Therefore talks were scheduled to resume on Tuesday.

THE COMPANIES SAY THEY ARE OFFERING US IS A $130 MILLION INCREASE. THE GUILD CALLS IT A ROLLBACK. WHY THE DISPARITY? The companies have still not explained how they arrived at their $130 million figure, but we can certainly explain how this is a rollback.

OKAY. SO HOW IS THEIR MADE-FOR-INTERNET PROPOSAL A ROLLBACK? Currently, the writer of a 30-minute prime-time TV show makes almost $21,000. The conglomerates are proposing that if that writer wrote the same show for the Internet, his or her initial compensation would be $2,600. That’s a rollback of 88%.

SO WHAT’S THEIR OFFER ON INTERNET RERUNS? Currently, the writer of a half-hour television episode makes about $11,600 when his or her episode is first re-run on TV. The companies are proposing that if that same episode is rerun instead on the Internet, they will pay the whopping total of $139 for unlimited reruns for one year--and nothing at all if it only streams for six weeks. About a third of all TV series are now being rerun only on the Internet. This amounts to an immediate 98.8% rollback. And it gets worse. If they decide to call a show “promotional,” they don’t have to pay us anything. It’s a “freepeat.”

WOW. AND WHAT ABOUT FEATURES? Are you sitting down? The companies want to be able to stream any and all feature films in their entirety, supported by advertising dollars, and pay the writers nothing. Zip.

Nada. Bupkus. A 100% rollback.

GIVEN ALL THIS, HOW IN THE WORLD DID THE COMPANIES COME UP WITH THE $130 MILLION FIGURE? Our question exactly. It’s definitely not a three-year number. As near as we can figure, their proposal might net us that total around the year 2107.

YOU HAVEN’T SAID ANYTHING NEW ABOUT DOWNLOADS. Neither have they. We are hoping that they will address this essential issue by Tuesday. Stay tuned.

In solidarity,

Nick Kazan

Howard A. Rodman

Phil Robinson

Tom Schulman

(for the Board of Directors)

Comments

[Boss]

Wow, the WGA's logic here is incredibly messed up. They are acting like broadcast TV is going to cease to exist tomorrow and everything will be broadcast over the Internet via crappy 128kbps Flash videos.

[Stuart Creque]

Also, the AMPTP memo in the preceding blog entry explicitly states that the $130 million is over the 3-year life of the contract. On the other hand, the memo doesn't explain where the AMPTP came up with the $130 million figure.

Seems to me that a vital step in the negotiations will be to have both sides agree on the math to use in valuing the deal points proposed by either side. Hard to see how to get a deal done if both sides assign different values to proposed deal points.

[Tim]

"Wow, the WGA's logic here is incredibly messed up. They are acting like broadcast TV is going to cease to exist tomorrow and everything will be broadcast over the Internet via crappy 128kbps Flash videos."
Its not going to cease to exist tomorrow, but the itunes music store only started 4 years ago and look at where the music industry is today. And the web is just starting to become a viable avenue for video. The times they are a changin.

[Hollywoodworker]

Absolutely Tim! The WGA accounting is totally flawed... TV will NOT end tomorrow... how do you say that a made-for-internet TV show is an 88% rollback? How many TV shows are made for the internet? ZERO!!!! Producers and studios can't make shows JUST for the internet... the market penetrantion of the internet is way to small to offset the cost of production to just distribute via the internet.

In addition on internet re-runs.... a "roll-back" of 98.8%! What a load of crap! You forgot to mention the $56,000 you received for the first run! Hello! If they propose to take away the $56K then maybe you could call it a "roll-back" WGA!!!

[Jeff]

Hollywoodworker --

The mistake you're making is looking at the way things are now rather than anticipating the merging of TV and Internet that everyone knows is coming. If you're right and that few people will watch off the Internet, then assigning a percentage of the gross realized from the number of views of a given episode will not be a realistic financial inhibitor of production.

I remember when Showtime and HBO got started. Their initial productions were often tapings of stage plays. Remember BAREFOOT IN THE PARK with Richard Thomas and Bess Armstrong? Nobody thought then that there would be enough dough in cable to move to projects like THE SOPRANOS, THE TUDORS and BAND OF BROTHERS. I promise you, the Internet will get there as a distribution medium, and very soon.