The shameless double talk by the conglomerates' top management could well be what loses them this strike. Our message resonates with the nation, while the CEOs lose ground each additional day they let this painful situation drag on. But could their double talk also cost them their jobs?
In today's Variety, Dave McNary's article "Writers Are Winning Over the Public" puts it in simple terms:
"On one hand CEOs of major media congloms are selling Wall Streeters on the fact that their digital offerings are growing like gangbusters and driving the bottom line. On the other hand, those same execs are holding out their hands and saying, a viable business model just doesn't exist and profits just aren't rolling in yet to give striking scribes what they want.It's a very questionable business practice to bully the people who create your product, but when the way you do so calls into question the integrity of what you're telling shareholders, that's big trouble. That's flirting with something called fraud, and the Securities and Exchange Commission frowns on that.
The problem is the congloms are stuck in the precarious position of angering shareholders: tell them that your company isn't growing and the stock plummets. Let the strike continue for six months or more and you anger those same shareholders, because in reality, companies will be losing revenue, as a result."
So now, thanks to this strike, the CEOs have to answer a simple question: Whom are they lying to? Both stories can't be true. And that's the subject of our latest video:
Perhaps fired up by viewing a previous video, "Voices of Uncertainty," an anonymous supporter drafted the following letter and sent it to United Hollywood. It is addressed to Rob Feckner, the President of the CalPERS Board. CalPERS is the massive pension and retirement fund for California's public employees. According to Wiki, CalPERS is the largest pension fund in the U.S. with over $254.8 billion in assets. An investor like CalPERS following up on a letter like this is what keeps CEOs awake at night.
Dear Mr. Feckner and Colleagues:Many creative professionals are also shareholders in the conglomerates, and none of us want to see stock prices plummet in the way McNary describes. But unfortunately, the CEOs are playing a dangerous game. Not only with our careers, but with their own.
As you are likely aware, the Writers’ Guide of America has declared a strike against the entertainment conglomerates who employ its members. While there are many points at issue in this labor action, the foremost is the companies’ unwillingness to commit to a plan by which writers -- and presumably, their colleagues throughout the entertainment industry -- can meaningfully participate in the revenues to be reaped from the Internet, mobile phones, and other new media.
The companies contend that their studies reveal the Internet and mobile phones to be untested distribution models with minimal revenue potential, and they therefore cannot commit to any revenue-sharing plan. There are two possibilities. One is that the companies are lying. The other is that they are telling the truth. In either case, we call upon CalPERS to divest its portfolio of these companies’ stocks.
If the companies are lying, and web and mobile technologies are the multi-billion-dollar gold mine we believe them to be, then this is a pure case of unmitigated greed, in which workers will be prohibited from sharing the benefits of their work. If forced through, this brazenly tight-fisted policy will have a hugely detrimental impact on the incomes, health care prospects, and pensions of thousands of Californians. CalPERS has a strong and powerful history of board activism, and we would ask you to exercise it on behalf of an important cause close to home.
If, on the other hand, the companies are telling the truth, then we humbly recommend you reconsider your investment in their stocks on purely fiduciary grounds. If the largest holders of video content in the world seriously cannot find a way to monetize it using the dominant distribution technologies of the coming decade, they are likely doomed to failure, and you would be doing your pensioners a favor by divesting yourself of their stocks immediately.
Many of us are the children, parents, spouses, and siblings of CalPERS members. We admire the fortitude and thoughtfulness with which you have managed their futures and hope you will consider using your considerable clout to help the working men and women of the entertainment industry secure ours.
The complete list of struck companies can be found at: http://www.wga.org/subpage_member.aspx?id=2537