Some interesting things came up on the message board I moderate concerning the WGA strike, I thought I would share some of it with you here.
Question: “I can see why the guys/gals want more money for their work, but do they really need it?”
I have to say the issue is hardly that one-dimensional. The main issue is DVD and new media. At the resolution of the last strike both sides agreed that home video was an unproven format so the writer’s were given a very, very, mathematically ridiculously small percentage of those sales. But with DVD sales becoming so big for things like TV shows (DVD sales alone resurrected Family Guy) the previous argument of ‘we haven’t tested the market yet so you can only get a tiny tiny return as we don’t know the margins yet’ doesn’t hold. It’s a huge market and I personally want writer’s to get a fair share of that pie. I did the math and even if they got everything they’re asking for it would only be about 50 cents per $20 DVD that gets sold and we all know in negotiations you ask for everything and settle for less so whatever number is finally agreed upon it’s likely to be much less than that. As for new media they currently get NOTHING. The studio sells an episode of The Colbert Report on iTunes for such-and-such an amount, the writer whose work is being sold gets squat. Now I think a case could be made that the internet and such is an untested market so why not give them the same deal on internet sales that they gave them in the last strike for DVD sales? As to do they really need the money, when you consider the advent of direct-to-DVD content I would say yes because it will be the only source of revenue for some material and I would argue the direct-to-DVD market is growing.
Question: “When are the writers going to get to a point where they HAVE to negotiate?”
Depends on how you look at it. Various polls place public support for the companies at 4% - 8% depending on what poll you read and something like 66% - 84% support for the writers. Some writers such as those on Family Guy and, it has been rumoured, the Daily Show, and The Tonight Show are being paid out of pocket by their direct bosses or the talent or producers during the strike. According to The Huffington Post the writer’s strike will cost studios about $21.3 million per day if the strike goes into the next month on movies alone. The last strike cost the industry an estimated half a billion dollars. I would say time is on the writer’s side here.
Also initially the companies’ side said they would refuse to negotiate until the strike was over but that doesn’t make any sense. After a couple weeks they changed their position and asked to negotiate so long as new media (i.e. the internet) was not discussed. The writer’s refused to return to the table until they can at least talk about it. I believe they have since returned to the table under a media blackout.
Question: “For TV DVDs, are they given royalties at a per episode rate, or a flat fee?”
They were requesting 2.5%, which on a $20 DVD works out to 50 cents. So here are a few examples, since you’re concerned with TV shows I’ll take 3 shows I’m currently in the market for (and thus know the price)…
24 (5th season)
Cost: $57.99
Writers want $1.45
Sex & The City (6th season, first half)
Cost: $36.99
Writers want 92 cents
Family Guy (volume 5)
Cost: $34.99
Writer’s want 87 cents
And as I mentioned before this is what they have asked for, what will actually happen and what they are likely to be happy with is in all likelihood going to be less than that.
As I understand it they currently get 0.3% of the first million units and then 0.36% (hense the mathematical absurdity). So…
24
Cost: $57.99
Writers want $1.45
Currently get: 21 cents
Sex & The City
Cost: $36.99
Writers want 92 cents
Currently get: 13 cents
Family Guy
Cost: $34.99
Writer’s want 87 cents
Currently get: 13 cents
So I figure if both sides compromise and the writer’s get half of what they’re asking for it seems fair to me. Keep in mind the current figures were negotiated for VHS, not DVDs, the studios just applied the same formula from the VHS agreement. VHS tapes sold at higher prices in 1988 than DVDs sell for now and the production cost of the tapes were much higher than it costs to make a DVD today. So in addition to the ‘untested market’ issue the cost to produce the media was much higher. Now studios make MORE off DVD sales than the box office and have saved huge amounts on the cost of producing the medium but none of that has translated well for writers.
The WGA has also suggested simply doubling the current rate from 0.36% to 0.72% as a compromise so the writer’s would go from getting 4 cents on average per DVD sold they would get 8 cents. Seems incredibly reasonable to me.
Let’s break this down one last time…
24
Cost: $57.99
Writers want $1.45
Currently get: 21 cents
Would settle for: 42 cents
Sex & The City
Cost: $36.99
Writers want 92 cents
Currently get: 13 cents
Would settle for: 27 cents
Family Guy
Cost: $34.99
Writer’s want 87 cents
Currently get: 13 cents
Would settle for: 25 cents
Question: “The only question that remains is how royalties work with sales and stores selling DVDs at different prices. I imagine royalties are paid out based on what the store pays for the DVD (cost), and not the price the customer pays. Otherwise, how would sales and clearance work?”
The percentages actually come off the distributor’s gross which means the amounts I quoted with regards to TV DVDs are actually much higher than they would be. For example wikipedia says writers currently get 4 cents for the average movie DVD. That means the distributors gross a little over $11 per movie DVD so you can probably take my examples and divide all the numbers by 2.
Comment: “The corporations are taking the big risk while everyone else walks away with a paycheck”
When we’re talking about paying a percentage of sales I think it’s difficult to argue that the studios take all the risk and the writers are assured a big paycheck. If the item doesn’t sell well both lose, if it sells great both win. There’s something to be said for profit-sharing incentive.
As well oftentimes studios and large corporations interfere with the creative process, sometimes for good sometimes for bad. If studios change what someone writes but keeps their name on it there is a shared risk in terms of reputation if nothing else.
Comment: “I’m just not ready to join the status-quo on this one with the kind of paychecks given to these people”
You seem to think writers make a crazy about of money. I honestly don’t know but if it’s anything like acting or even technical work in the field there are often long periods of unemployment. It’s somewhat like sports, yes a guy makes a million dollars a year but how much of his life is viable to perform (and therefore earn) at that level?
Question: “Did you know that the writers don’t make a CENT from streming TV shows offered by networks?”
This, for me, would be the one murky sticking point. For one thing do the studios receive a separate revenue from commercials contained with a streamed episode? Also I’ve seen streamed episodes without commercials - how would you compensate for that? And then there’s webisodes. There are just so many possible combinations and contingencies I see this as the big hurdle. If someone else makes direct revenue off of it like iTunes or streaming commercials whose ads aren’t part of a larger arrangement hard to separate from the whole then absolutely the writers should be compensated on a percentage basis. As for the other stuff like where you can’t isolate the revenue from streaming ads or cotent without ads or webisodes it’s much trickier. Perhaps a flat rate for something like that but this IS the untested market so it’s really hard to say what’s fair.
Thanks to forum members who provided questions and comments (all in italics).