The AMPTP seems to be admitting that New Media residuals are not being paid to the WGA. Why? A lot of "the dog ate my homework" excuses. It's clear from this press release that Hollywood is starting to see the studio and network CEOs flopsweat. (See my previous, SCANDAL! WGA Goes After Big Media For Reneging On New Media Payments.) UPDATE: Now the WGA issues its reply, which is tantamount to: Don't fuck with us, you lying employer weasels:
The Writers Guild of America, West (WGAW) today issued the following statement in response to the Alliance of Motion Picture & Television Producers (AMPTP):
"The facts of this matter are simple and straight forward. The WGA attempted for eight months, since March, to address via dialogue the AMPTP’s erroneous interpretation of our February agreement. These efforts included a number of conversations between the Guild’s executive director and at least one of the CEOs who made the deal with the WGA, as well as multiple conversations over months with the top executives of the AMPTP, all to no avail. We will now go to arbitration to force compliance, and we expect to prevail.
"While the date the arbitration was filed was not related to negotiations between SAG and the AMPTP, it is important to point out that the AMPTP apparently had no qualms about announcing its “deal” with the IATSE on the day prior to the mediation with SAG, obviously timed to impact on those discussions. The WGA, like everybody else in this industry, is extremely anxious about those negotiations and hopeful that the AMPTP will reach a fair and reasonable agreement with SAG quickly."
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The AMPTP finally replied to what it claimed were the WGA's "misleading" allegations regarding not receiving New Media residuals:
On November 19th, the Writers Guild of America issued a press release alleging that Hollywood studios "are not paying residuals for writers' work that is reused on new media."
-- The WGA issued its press release just as a federal mediator was about to bring SAG and AMPTP together. In addition, the WGA made its complaint about new media residuals without first asking any of the Companies to help resolve any outstanding issues, as is customary practice.
-- The WGA's press release was highly misleading and seems to have been designed to poison the atmosphere for the federal mediation rather than to actually ensure that residual payments are made to working writers.
Here are the actual facts, in a nutshell:
STREAMING
-- Some studios have either made streaming payments to the WGA under the new formula, or are set to make those payments this week. The remaining studios are still working to program their residual systems to incorporate the new formulae. Some will process the payments manually in the meantime. Interest will be paid on any late payments.-- Further, studios have been making residual payments all along for Temporary Downloads, as well as Permanent Downloads (called Electronic Sell-Through, or EST). EST residuals for programs released before February 13, 2008 have been included in the DVD payment structure, contrary to the WGA's press release that payments were not being made for the reuse of writers' work on new media.
Even before the WGA issued its press release, studios had informed the WGA that new systems were being put in place to calculate and distribute streaming residuals. WGA was further informed that even though the new systems were difficult, costly and time-consuming to implement, steady progress was being made. Complexities of the new procedures include:
An unprecedented number of new formulas for residual payments for film
and television streaming, permanent downloads (EST), and derivative and
original made for new media programs that needed to be programmed.Payment systems must account for a variety of new variables, including
platform, release window, library vs. current product and allocations to
each Guild and Union.WGA also knew that, to the extent the difficulties in creating these new systems delayed payments beyond their due dates, the studios would owe interest payments as called for by the labor agreement.
WGA knew all of this and nonetheless issued its press release.
The WGA knew all of these facts, but decided to misuse the issue of new media residuals for the Guild's own partisan purposes. Instead of working cooperatively with the Companies to resolve any outstanding issues, the WGA went public on the eve of the crucial SAG-AMPTP federal mediation. This move was blatantly designed to disrupt that mediation and help justify SAG's eventual decision to reject the AMPTP's offer and end the mediation. In short, AMPTP and the studios are dealing with the issue of new media residuals substantively, while WGA is more concerned about playing politics with the issue than with ensuring that working writers receive payment.
ELECTRONIC SELL-THROUGH (EST)
Also on the eve of the federal mediation, the WGA filed an arbitration claim disputing the way AMPTP was interpreting certain language in the new agreement.
WGA filed this arbitration claim to generate the kind of media coverage that would poison the atmosphere just prior to the start of federal mediation.
The language at issue in the WGA agreement is exactly the same language that was included in each of the Guild and Union contracts negotiated this year. No other Guild or Union has ever questioned the interpretation of the language. No one else has ever suggested that the language means anything other than what it clearly says.
Here are the specific details on the language that WGA has disputed:
-- The newly-negotiated terms for EST are consistent among the WGA deal and those labor pacts negotiated by the DGA, AFTRA and IATSE. The language (see below) clearly specifies that the terms shall apply to motion pictures (e.g., TV and features) released after the start of the new WGAcontract, February 13, 2008.
-- The following is the language on permanent downloads (EST) as laid out in Section 1.b. of the "Sideletter on Exhibition of Motion Pictures Transmitted Via New Media" (as taken from the Final Memorandum of Agreement sent to WGA on Feb. 21, 2008):
"Paid Permanent Downloads ('Download-to-Own' or 'Electronic Sell-Through') ('EST'). The following shall apply to motion pictures released after February 13, 2008: If the consumer pays for an EST copy of a theatrical motion picture, the Company shall pay residuals to the credited writer(s) at the rate of 1.8% of 20% of Company's "accountable receipts," as that term is defined in Paragraph 3 below, for the first 50,000 units and 3.25% thereafter. If the consumer pays for an EST copy of a television motion picture, the Company shall pay residuals to the credited writer(s) at the rate of 1.8% of 20% of Company's "accountable receipts," as that term is defined in Paragraph 3 below, for the first 100,000 units and 3.5% thereafter."
The fact that their response is that some of them are “set to make them this week” seems to imply that they were prodded by being outed. The WGA was just making clear that most of this money has yet to leave the buildings, nearly a year after the deal was shoved–er, struck.
Comment by David Handelman — December 1, 2008 @ 4:52 pm
There there, Amptp, we know you’re having a tough time this holiday season. Have a little egg nog and take a nap. Those pesky writers are just a little gun skittish, having been mistreated by you time and time again. Of course everyone’s working on implementing the formula and writing new programs on these funny ‘computers’ to try and spit out the correct residuals. But, these new ‘computers’ are hard to work with and finding someone to ‘program’ them could take months or even years. Can’t the WGA understand that you’re working on it and just leave you alone?
-There there
Comment by there there — December 1, 2008 @ 5:10 pm
Fascinating.
The very same people who make what should be a simple business overly complicated, are now admitting that they aren’t honouring their contract commitments because things are too complicated.
Can they make themselves look any worse? Is that possible? The logical side of my brain says that it can’t be possible, but past experience tells me that they are bound to find something new to screw up.
Comment by Furious D — December 1, 2008 @ 5:19 pm
Its their job to do the accounting. Its their job to pay. If I went into work and said that it was too complicated I would be fired. cmon There needs to be a clause in union contracts that we can all(all unions) go out together when they don’t pay.
Maybe I’ll tell my bank that the whole mortgage thingy payment book is just too complicated.
Comment by it their job — December 1, 2008 @ 7:37 pm
Furious D that was an excellent comment.
Now the WGA issues its reply, which is tantamount to: Don’t fuck with us, you lying employer weasels:
Nikki… wow… this is a
family</strikecommunitynewsclusterfuck shitstorm of a site.I love you.
You need your own zany show.
Comment by Captain Obvious — December 1, 2008 @ 8:47 pm
So these same companies that claim to be mastering new media are just now understanding that you need to use something called a ‘program’ or ’software’ to help you calculate the residuals and not say a lawyer or an accountant to help you pick numbers out of the sky that magically add up to “we don’t owe the writers anything”.
Let’s not get into the fact that if they had half a clue the execs would know that the program/software that can calculate residuals can also figure out how many people are watching your content and therefore what you should charge advertisers if you want to make the content free to view or the viewers themselves if it’s going to be paid content. And let’s also overlook the idea that if you’re in the business of providing content the software/program that hosts the content and makes it available for viewing should have these ‘accounting’ features written in when you are first putting the software/program together rather than paying for inferior pig in a poke programming.
Who in their right mind thinks that with thinking like this the conglomerates under their current leadership are going to dominate new media unless of course they are permitted to continue lying cheating and stealing to cover their incompetence?
However if the whole excuse that the AMPTP has fabricated regarding the creation and refining of these systems for new media residual calculations is actually a ruse to delay or deny payment of the residuals accrued, don’t you all think that the people offering it could have and should have done better in fabricating a falsehood? Because this one is insultingly flimsy and utterly unconvincing, so much so that everyone — talent, public, shareholders, and federal regulators not to mention courts of law — should ensure that the execs currently running the companies be forced to resign in disgrace for being extremely inept liars and confidence game operators.
How very pathetic of the execs running these conglomerates that they should prove to be so utterly (and perhaps congenitally) stupid and so easily caught between the Scylla of straightforwardness and the Charibdes of common sense.
Comment by WhyWeWatch — December 1, 2008 @ 9:02 pm
Got a show, second season, no streaming residuals, or EST residuals yet. Not even a way to try and collect them still. Excited about the AMPTP announcement that checks are being cut this week. Waiting for the further announcement that those checks will now be delayed somehow by the WGA filing. When things don’t have to make any sense, they’re easy to make up!
Comment by showrunner5 — December 1, 2008 @ 9:33 pm
I’m telling you - if “transparency” of any sort is forced on the AMPTP, they won’t know whether to shit or go blind.
You know, in “Apollo 13″ when they’re asking for just the basic numbers so the three man crew can get to work implementing them for the re-entry, and nothing is coming, and finally Kevin Bacon says “they don’t have them” and the other guys look at him and Bacon says “they don’t know how to do it - they don’t know how to get us back”
That’s what this is turning into. The AMPTP, more than any other single thing - I’d bet you the fucking farm - are being such pricks because they can’t function without being able to cook the books. I’m telling you - the new media percentage deal SAG is asking for would require complete transparency and honest accounting, and Hollywood has NEVER operated that way since the guy got off the train and said “Let’s start shooting” back in the 20’s.
This scares the living shit out of them because honest accounting is a business model they don’t understand.
“If we have to actually tell the unions and the public what the real numbers are? We’re fucked!”
Comment by T-REX — December 1, 2008 @ 9:49 pm
CEOs –
It’s a new day in Washington. Bush is out, and there’s a public thirst for the blood of you and your crooked brethren. Ask AIG, and the Big Three.
I hope there will be public congressional inquiries on your illegal behavior within the next year.
Comment by TimesUp! — December 1, 2008 @ 10:31 pm
They are all fucking liars. Doesn’t everyone understand yet that everything they say is a lie? They care about nothing but their soulless corpses and their bank accounts. I hope there is some version of hell for them that’s very similar to the Ving Rhames ass-pounding scene in Pulp Fiction. Or maybe their eyes are glued open and they are forced to watch Australia for eternity. That would be nice.
Comment by Ed — December 1, 2008 @ 10:33 pm
“The AMPTP, more than any other single thing - I’d bet you the fucking farm - are being such pricks because they can’t function without being able to cook the books.”
Abso-frickin’-lutely. They haven’t had enough time yet to re-program the computer systems to their favor. And that time bomb is ticking louder than Mona Lisa Vito’s (Marisa Tomei) biological clock.
I love it, absolutely love it that IA and WGA are finally seeing the predicament that SAG is in and supporting our endeavor. The wool is being pulled from everyone’s eyes now and the truth is coming rolling up the AMPTP’s front yard faster than they can run from it.
Now, where’s my authorization ballot?
Comment by Ace — December 1, 2008 @ 11:29 pm
AMPTP response is the 21st Century version of, “The check is in the mail.”
Comment by Horace D. Jones — December 2, 2008 @ 7:19 am
WGA: Get in front of a judge and get an injunction barring all new media use of material until back residuals are paid. The money will flow instantly.
Comment by Klaatu — December 2, 2008 @ 8:27 am
This is the first time I’ve agreed with t rex. They don’t know how to cook these books. Hits and est are counted by the second parties that sell these things. It’s in these second parties interests to report true numbers, they have stockholders as well. Given the raw data that the studios are getting, it must be impossible to hide it in their normal way. All one has to do is compare Itunes numbers with the studio numbers. I doubt the Jobs would want to collude with the studios and hide the numbers.
I think the AMPTP missed the boat in a sense when they stonewalled on dvds. They could have offered a 200% increase in residuals to make new media go away for three years. They could have figured out the cheat by then.For now they will have to suffer transparency.
Comment by just a thought — December 2, 2008 @ 9:47 am