The AMPTP issued a statement tonight and the WGA's is below that. The negotiations broke down today not because of the traditional DVD residual issue, but about residuals for the Internet such as electronic sell-through -- i.e. Internet downloads. The AMPTP keeps saying electronic sell-through is synonymous with DVDs. The WGA says they're different and wants to negotiate a new residual formula. AMPTP refuses. Everyone knows that New Media and the Internet are the overriding issues of this negotiation. And now no more bargaining is skedded because of them. (... Remember, DHD comments are turned on. Opine away!) :
"AMPTP POSITION STATED TO THE WGAW AND WGAE TODAY
BY AMPTP PRESIDENT NICK COUNTER"We’ve been working hard to come up with a package in response to your last proposal. But we keep running up against the DVD issue. The companies believe that movement is possible on other issues, but they cannot make any movement when confronted with your continuing efforts to increase the DVD formula, including the formula for electronic sell-through.
The magnitude of that proposal alone is blocking us from making any further progress. We cannot move further as long as that issue remains on the table. In short, the DVD issue is a complete roadblock to any further progress.
This cannot come as a surprise. Before the negotiations began, Writers Guild of America West President Patric Verrone met with many CEOs. The consistent message from the CEOs was that, for overriding business reasons, the home video formula would not be changed. Nevertheless, you proposed to increase the DVD formula in these negotiations.</p>
<p>We want to make a deal. We think doing so is in your best interests, in your members’ best interests, in the best interests of our companies and in the best interests of the industry. But, as I said, no further movement is possible to close the gap between us so long as your DVD proposal remains on the table. In referring to DVDs, we include not only traditional DVDs, but also electronic sell-through -- i.e., permanent downloads. As you know, we believe that electronic sell-through is synonymous with DVD.
There are pending claims with regard to electronic sell-through that will be resolved through the arbitration process. But to make any new agreement with you, residuals for the DVD market, including electronic sell-through, must be paid under the existing home video formula.
We are ready and willing to proceed to reach agreement with you. We call upon you to take the necessary steps now to break this impasse so that bargaining can continue for our mutual benefit and the good of everyone else who works in this industry."
POSTSCRIPT: After Nick Counter presented the above position, the WGA advised us that they were not prepared to continue tonight. When asked about tomorrow, they said no, we have a membership meeting. When they were asked about Friday, they advised they would call us.
2ND UPDATE: The WGA issued this "Latest Word" tonight:
"The WGA Negotiating Committee, on behalf of the Writers of Guild of America, West (WGAW) and the Writers Guild of America, East (WGAE), has issued the following statement regarding Contract 2007 negotiations:
Today, just hours before the expiration of our contract, the AMPTP brought negotiations to a halt. The Companies refused to continue to bargain unless we agree that the hated DVD formula be extended to Internet downloads.
This morning we presented the AMPTP with a comprehensive package of proposals that included movement on DVDs, new media, and jurisdictional issues. We also took nine proposals off the table. The Companies returned six hours later and said they would not respond to our package until we capitulated to their Internet demand.
After three and a half months of bargaining, the AMPTP still has not responded to a single one of our important proposals. Every issue that matters to writers, including Internet reuse, original writing for new media, DVDs, and jurisdiction, has been ignored. This is completely unacceptable.
There will be a WGA West membership meeting in Los Angeles Thursday night."
UPDATE: More details about the WGA's "Comprehensive Package Proposal" presented today are here. In the meantime, there's a new blog by a member of the WGA "Communications Committee" at UnitedHollywood.com. It critiques the media coverage of this breaking story as well as imparts info.
“DVDs an Issue All Over Again?” How is a permanent download a DVD? If it is, then what isn’t a DVD? Is VHS a DVD?
Comment by anon lawyer — October 31, 2007 @ 7:09 pm
Patrick Varrone is single-handedly holding this process up. So hey, PV, drop the tough-guy talk, and give a little love to the companies. I wonder if Mr. Varrone will continue to earn a paycheck even as his membership (and eventually the rest of the industry) don’t when and if this strike happens? Kinda skews his perspective when he knows that HE’LL continue to get pizzaid!
Comment by Kyle Smith — October 31, 2007 @ 7:12 pm
I hope Counter and Verrone end up locked in a room together for all eternity–without chairs. No good will come of this. And also, my career is ruined.
Comment by Sammy Glick — October 31, 2007 @ 7:16 pm
“In referring to DVDs, we include not only traditional DVDs, but also electronic sell-through — i.e., permanent downloads. As you know, we believe that electronic sell-through is synonymous with DVD.”
I can’t even fathom how unbelievably stupid the studios think the writers are. Creating digital downloads costs almost NOTHING, and while DVDs have become fairly cheap to produce, they still can’t even come close to how little it costs to distribute online.
The studios are being unrepentantly greedy, and are insulting the intelligence of everyone who works in this business if they think they’re going to get the writers to agree to the same onerous formula (and in turn the Actors and Directors once this strike is settled) for downloads as DVDs.
Anyone with even a moderate understanding of digital distribution and its associated costs knows that the producers don’t have a leg to stand on here, and this is THE key issue of the strike.
-Low-level Production Monkey
Comment by E. — October 31, 2007 @ 7:23 pm
We were just sent out instructions to pack up our belongings at work on Thursday.
Strike on.
Comment by Out Of Work — October 31, 2007 @ 7:29 pm
Um, Kyle, you misspelled Patric’s name, twice. You’re also wrong about his salary. Elected guild officials do not receive a salary. You’re also wrong about who is holding the process up. (Hint: it’s the studios)
No writers wants to put their crews out of work, or their staff, or themselves. We don’t want to cripple the industry. We have been given no choice.
Comment by Anonymous — October 31, 2007 @ 7:40 pm
Rock. Hard place. You know the drill. The Companies would rather endure a strike than change the current DVD formula. They will not give an inch/penny/drachma. The notion that this is PV’s fault is absurd on the face of it.
The only question is, when faced with this kind of intransigence, do you fold or to you fight?
Comment by Harley — October 31, 2007 @ 7:41 pm
Rock. Hard place. We all know the drill. This has nothing to do with PV. This is about the absolutely intransigence of the Companies when it comes to DVD residuals. The only question now is, when confronted with this, does one fold or fight?
Comment by Harley — October 31, 2007 @ 7:44 pm
My family and I will be without a home within 2 months of this god damed strike. Thanks Mr Counter. You’re a real gem.
Comment by Fu*#*d — October 31, 2007 @ 7:46 pm
So I misspelled his name? Twice? Oooooh. Sinful.
And you say he too isn’t earning a paycheck during the strike?
Wow. Then he’s a bigger dope than I thought.
And don’t JUST blame the studios, people. If they strike, its “they” that are striking and shutting the town down with no regard to the working man, not the studios.
Someone needs to shove a pacifier in the WGA’s mouth and end this spoiled baby temper tantrum stuff.
Comment by Kyle Smith — October 31, 2007 @ 7:55 pm
As you know, we believe that electronic sell-through is synonymous with DVD.
Well I sure as shit didn’t know this. Just…wow. If that’s their position on the last day of negotiation (!) … strike on. That sure does bring a lot of clarity as to what this is about.
This is going to be long and painful. But that one sentence says everything I need to know.
Strike to the death.
Comment by Holy crap! — October 31, 2007 @ 7:56 pm
“As you know, we believe that electronic sell-through is synonymous with DVD.”
“These aren’t the droids you’re looking for.”
- Nick Counter
What a load of bunk!
Comment by Anonymous — October 31, 2007 @ 8:08 pm
I know I’m going to regret asking, but Kyle? Do have a point of any kind or just a lot of freefloating anger? For example, do you think the current residual formula is a fair one? Just wondering.
Comment by harley — October 31, 2007 @ 8:15 pm
No regard for the working man, Kyle? Writers aren’t workers now? I think we can see what side your bread is buttered on.
Comment by Dominic — October 31, 2007 @ 8:27 pm
Look, divided we fall. Directors, Writers, Editors, Composers, Actors…….there is no reason to have all these unions. We beat each other up so well the studios just sit back and laugh. Until we combine all the unions for the benefit of the members not the people who run them, then and only then can we avoid strikes and use are power together and overcome these unfair deals.
Also as I stated, we need to get rid of our agents and empower our union to in addition with our lawyers and managers to make our deals and help sculpt our career. Agents work for studios not us and Nikki has exposed that.
Cause she has had the balls to do this she will in addition to going to heaven, soon get cool mix cds for her pleasure from a thankful reader.
Comment by The Hyphen — October 31, 2007 @ 8:29 pm
I’m primarily a novelist, but am working on a number of film and tv projects. The largest of these, a tentpole feature (which is the deal that GOT me into the WGA), is on hold (obviously) while the discussions take place (or don’t, depending on the day, it seems). And compensation aside, there is one thing I see daily in publishing that is much more infrequent in Hollywood: respect.
Everyone knows that crummy old joke about the blonde wannabe starlet who wanted to sleep her way to a movie career - but was so dumb she slept with the WRITER…
The thing is, that’s not just a joke. That’s how the movers and shakers really feel, and how, for the most part, the writers are treated. There to be used. Powerless. Generally unnecessary. And yet nothing can begin without the story.
I recently made the error of sending a note to a studio head about a project I had just delivered. We’d traded notes before, and what I sent wasn’t anything outrageous or controversial - just a note. But it opened the floodgates of wailing and gnashing of teeth and calls and emails between the studio and producers and lawyers all panicked over the CONCEPT that a WRITER had the temerity to contact HIS OWN EMPLOYER DIRECTLY.
I understood fully that it was ‘not protocol’, and one of the producers explained it away to the others as the result of my inexperience. I simply didn’t know any better. I did understand (after talking to him) that it was more appropriate to have contacted the exec (regarding the project) in tandem with the producers, but that was the logical part of my brain doing the processing.
The rest of it was stuck on the sheer outrageousness expressed that the writer would contact the exec. The sentiments expressed (and the directive given: “you are NOT to do that again”) told me exactly what my value was to the process.
I had written the book which I subsequently adapted into the screenplay which will be produced by the person I wasn’t even permitted to contact. That project, that story, exists because I made it.
On the publishing side, I can phone, email, or meet with the President of the company any time it seems appropriate, and for any reason. Even to just suggest lunch. My editor, publisher, associate publisher, and the President all make me feel like we work as a team. And when one of us needs to talk to the other, no one stops it, or worries about other agendas being compromised.
Of course, as in Hollywood, here are times when protocols must be followed. There is a proper order to things. But - I’ve always felt respected, and that they valued my work.
I don’t know that this opinion does, can, or should have any bearings on what the WGA is negotiating. What I do think is that if we, the writers, actually felt as if our work were valued, as if we were respected equally with the other members of the team, then we’d be a lot more receptive to anything being discussed. Anything.
The reason the comparison between our compensation and the cost of the packaging is so compelling has much less to do with the numbers and economics than it does with the fact that it sends a clear message: you are worth less to us than packaging.
If the execs can figure out how to change that message, he numbers will become much easier to discuss.
Comment by James A. Owen — October 31, 2007 @ 8:32 pm
It is troublesome that things have reached such a point when the WGA is essentially fighting for profit participation. The UAW recently struck (for only two days) because they were fighting over their pensions. Other unions are fighting for the same. How will this look in the eyes of blue collar America?
This is not Haymarket Square, writers are not fighting for an 8 hour work day…
I hope this comes to a reasonable and fair conclusion soon. There are a lot of people riding on a reasonable outcome.
Comment by Elliott — October 31, 2007 @ 8:41 pm
I am a writer on a current network show, and last season a guild rep spent a couple of hours with us reviewing the contract questions. Back in March, he told us about this bizarre idea from the AMPTP that internet downloads should be qualified as downloadable DVDs, whatever that means. The reasoning behind this is simple — the companies needed a formula for internet download residuals: they looked for the worst current formula, which is for DVDs. Thus internet downloads became downloadable DVDs because the formula is the one where they owe writers, actors, directors, etc the least amount of money. The companies apparently refused to consider the fact that DVDs cost something to produce, while internet downloads cost virtually nothing.
Comment by TV Writer — October 31, 2007 @ 8:41 pm
So they believe sell-thru is synonymous with DVD. Much in the way DVDs were synonymous with VHS tapes. That the cost of delivery is less with each iteration — not much spent on packaging when it comes to downloads, yes? — is apparently not important. Their profits increase, and everyone else is free to choke on their own objections. Becuz they won’t get one single penny more.
Fuck ‘em.
Comment by harley — October 31, 2007 @ 8:43 pm
DVD are the same as downloads! The WGA simply cannot cave on this issue, because eventually the broadcast networks will all go the way of the DuPont Network, but Time Warner and the rest will continue to be in the content business, while only paying those pesky folks (actors, directors, writers) who generate the content a fraction of what the broadcasters did.
Comment by Mike — October 31, 2007 @ 9:00 pm
Elliott — we’re fighting for pensions, too. Not just fair pay for internet content. There are 72 rollbacks in the Companies’ proposals worth over 70 million dollars. On Friday, as I think Nikki reported, the WGA made concessions on the CW and other stuff and the AMPTP came back with a NEW rollback on pension and health. (So I guess that’s 73 rollbacks in their proposals, actually.) Writers aren’t just fighting for fair compensation, we’re trying to keep the Companies from crushing our union.
Comment by ashley — October 31, 2007 @ 9:19 pm
Hey - you’re all missing the point on the DVD download argument, and looking at the wrong thing.
This isn’t about movie downloads.
It’s really about TV show downloads: Currently, when a TV show goes into repeats, there’s an established formula for what writers get paid, which is a fairly healthy second payment on the episodes they wrote, and so on, into syndication.
As TV moves into streaming media - where first run shows are available on the net either simultaneously, or a few days later, the producers are suggesting that these fall under the category of DVD sales - a mere pittance per sale - as opposed to the “real” money paid for either a rerun, or syndication.
So what you’re not taking into account here is the real economic picture, which involves not just the WGA, but SAG and the DGA as well: As all TV goes online (and/or on-demand,) the syndication and second-run payments that used to help keep the gardeners, restaurants, talent agencies, dentists, stock brokers, valet car parkers and insurance agents afloat will disappear, or be severely reduced, under the DVD formula.
The writers are first here, but the DGA and SAG are looking at exactly the same problem.
Comment by A Screenwriter — October 31, 2007 @ 9:57 pm
Kyle Smith wrote: Patrick Varrone is single-handedly holding this process up. So hey, PV, drop the tough-guy talk, and give a little love to the companies. I wonder if Mr. Varrone will continue to earn a paycheck even as his membership (and eventually the rest of the industry) don’t when and if this strike happens? Kinda skews his perspective when he knows that HE’LL continue to get pizzaid!
If the first sentence of Kyle’s post didn’t make it painfully clear he’s not a writer, the use of the word (sic.) “pizzaid” sure did.
Comment by Klaatu — October 31, 2007 @ 10:39 pm
Thank you for your work Ms. Finke. Most of the comments so far touch upon RESPECT as one of the core issues in this whole ordeal. It is exceedingly clear that writers are not afforded the level of respect we deserve. I don’t want to get political–and forgive the comparison–but in terms of respect alone, as a neophyte screenwriter on the periphery of this absurd industry I feel like the diamond miners or cocoa farmers in Africa–doing the brunt of the heavy lifting while being blatantly exploited and ripped off at every turn. In terms of respect we’re about on par with the prostitutes. That alone is worth STRIKING for. If it takes a Pyrrhic victory to get our voices heard, so be it. Let the streets of Hollywood roll in (figurative) blood.
Storytelling is essential to our species and the industry needs to give mad props to the architects of story. Let us hope that a day of reckoning and redress is on the horizon. If it’s not, I think I’d rather be a starving poet than a disrespected screenwriter anyway.
In passing: The WGA needs to stop supporting a climate where massive rewriting has become the norm in the industry. Spec writers get their work trampled on by a plethora of other writers (usually all fat from feeding off the inherent weaknesses of the system). What the WGA should consider is expanding its domain to include representation for writers and thereby replacing the current Agency system. Whether that’s possible or ideal I don’t know. The current Agency system is erroding the WGA’s overall powerbase.
Comment by Mark S. — October 31, 2007 @ 10:41 pm
Here’s what no one seems to get:
Residuals benefit the producers, not the writers.
Yep. It’s true.
Residuals are a way for the studios to defer paying us a portion of our salary until the project becomes successful (reruns, sells on DVD, sells on iTunes, sells internationally, etc.) Residuals help reduce the financial risk that the producers take on a project.
If the producers were smart (and not the type of people who give notes like the one I was once given after the table read of a TV episode which was part one of a two-part cliffhanger, the last line of which was “to be continued” — “Um… I feel like there are a lot of unanswered questions at the end.”) then they would be trying to increase residuals instead and hold upfront minimums where they are. They would be trying to shift a greater portion of wrtiers’ (and actors’ and directors’) salaries to the back end.
In fact, they should insist that all of their employees (especially the executives) only receive the second half of their salaries if the projects they develop (sic.) become successful.
Why don’t they get that? Just one more unanswered question, I guess.
Comment by Klaatu — October 31, 2007 @ 10:49 pm
Just throwing in my two cents here… probably already obvious to most…
It’s very telling that the producers won’t budge on the new media issue. At the moment, it’s such an incredibly tiny portion of their overall finances that it should be something Zucker alone could pay out to writers everywhere with the cash in his wallet at any given moment.
Their stern stance is a clear signal that they know, and all their internal projections and studies confirm, that new media will become a MUCH GREATER revenue stream. Not in the distant future, but within the timeframe of this next contract. Within three years time. They know this, and that’s why they want to pay as little as possible now.
From a purely business standpoint with no morals, OK, I get it. But at least admit the above instead of flat-out lying…
Comment by Another writer — November 1, 2007 @ 1:28 am
I think the novelist made a lot of sense, but one thing to remember - most literary agents and editors come up thru the book publishing ranks while a lot of producers may come from outside any writing fields at all and have no clue what it takes to write a treatment, a script or a book.
Having said that - a single formula for DVDs and downloads is not unreasonable IMHO - especially when you consider how prevalent piracy is in these areas and how hard it is to track it. And when the writers guild statement uses invective like “hated DVD formula” you do have to wonder if they want to negotiate or to inflame their ranks to advance a strike. And also I don’t think the writers have gotten the sympathy vote from the public - writers are supposed to persuade people, right? But most people who glance over this issue turn on their TVs at night or look thru the movie listings in the paper and see nothing at all worth watching much less paying for - there is a world outside of hollywood - remember the baseball strike about a dozen years ago - it took a very long time for them to get their fans back - people found other things to entertain them and spend their money on - and there are a ton of things I can be watching other than scripted shows and movies.
Comment by amy — November 1, 2007 @ 3:29 am
David Mamet observed years ago that hollywood lost the art of storytelling to eye-candy crap.
Stick a fork in Hollywood, it’s deep-fried past over done.
Comment by syn — November 1, 2007 @ 7:42 am
Amy, I remember that baseball strike. Owners were trying to curb player salaries through a very reasonable salary cap. The issue that led to the strike was trust which owners, including Bud Selig, managed to unfairly suppress player salaries in the middle 1980’s.
Still, players were in the wrong because the owners were fair on any offer or close to it while the players declined to negotiate in good faith so they can get what they want and that was a strike.
If baseball had a commissioner at the time of the 1994 strike, I am sure he would have filed a grievance with the US Court system on that trust issue and would have forced the players to play past the August 12 strike deadline and back to negotiations. If negotiations failed, the players went on strike, and any cancellation of the 1994 World Series would result in the use of replacement players for the entire 1995 season and beyond.
That isn’t saying that the WGA is wrong regarding the DVD issue because they deserve a good payday and as others said, writers are the backbone of the entire creative arts industry. Just remember this line from the Simpsons while you are out on the picket line:
“So we’ll strike day and night by the old cooling tower, They have the plant, but we have the power.
Comment by Jessy S. — November 1, 2007 @ 10:54 am
Syn, Hollywood isn’t done.
What this strike will do is force changes to the entire industry. I hope and pray that the WGA files a federal lawsuit forcing everything to shut down including pretty much everything that is airing including all reality TV. The only thing that could really air would be the NFL, NBA and NHL though NBC could air its entire Olympic library. In the end, I hope and pray that the current system is turned on its ear and that the writers are actually running the studios, than we would get much better programming.
Comment by Jessy S. — November 1, 2007 @ 10:35 pm