UPDATED: We're bringing the post from yesterday to the top of the page -- but we also wanted to let you know what's on the agenda for today.
We'll be updating frequently throughout the day as we get some answers to questions we all have -- where are the congloms getting their numbers? What are they based on? What really happened in the negotiating meeting? Why, after insisting that there was no way to do flat payments on internet use, did the companies suddenly completely shift their paradigm and tell us that actually, no, it was percentages they aren't willing to discuss?
We'll also be able to clarify what the WGA negotiating committee proposal numbers are, and confirm the ugly fact that all this could have been over weeks ago for less than the budget of doing PR for one theatrical release or fall tv show. As in, a lot less.
Stay tuned, folks. It's going to be a busy day. And if there's one thing I hope we've all learned in the last week -- let's keep a healthy skepticism about everything we hear. The truth remains on our side, we just have to get it out where people can see it.
The companies put out a press release today, thus ending the media blackout to which they and the WGA agreed. So this is what we no know:
That big, amazing proposal that the companies hinted to Nikki Finke was coming? Well, it came.
Turns out their exciting, groundbreaking proposal is... a residual rollback. And not just any rollback, one of the biggest in the history of the Guild. Then, stunningly, the companies have the balls to say their plan gives us more compensation. Well, I'm sorry, but If you take away a dollar and give me a nickel, the nickel ain't a raise. Somewhere, Nick Counter's first-grade math teacher is embarrassed.
So we decided to do some math of our own: We broke out the cost of the WGA's current proposal to the conglomerates into yearly figures. We found that the TOTAL payment yearly -- the total that ALL the companies would make under our proposals -- is $50.54 million. And that, we realized, is about one-third the budget of TRANSFORMERS. We are asking IN TOTAL, for the equivalent of the cost overrun on a summer event movie.
Instead of agreeing that that is a fair and just offer, they've proposed this:
When an hourlong episode of television is streamed on the Internet, writers would get a flat $250 payment for one year of reuse. That's $250 as opposed to, for example, $20,000 per episode when it's reused on network television. They proposed nothing new on downloads, it's still the DVD formula for those (ie. two-thirds of a penny for an iTunes download). For theatrical movies, they're offering exactly $0.00 on streaming. Oh, and they want to be able to define any content they like as "promotional" -- for which they would pay zero dollars. Even if they stream an entire film or tv episode, and even if they sell ads on it, they can call that promotional and pay us nothing.
THE AMPTP claims their deal is worth $130 million over three years. But what they don't mention is how much we'd lose under their proposal. As all media distribution transitions to the Internet before our eyes, their proposal takes away far, far more revenue than it provides.
A bold, new relationship? Sure, an abusive one.
Patric Verrone and Michael Winship sent this letter to membership a few minutes ago:
To My Fellow Members,
After four days of bargaining with the AMPTP, I am writing to let you know that, though we are still at the table, the press blackout has been lifted.
Our inability to communicate with our members has left a vacuum of information that has been filled with rumors, both well intentioned and deceptive.
Among the rumors was the assertion that the AMPTP had a groundbreaking proposal that would make this negotiation a "done deal." In fact, for the first three days of this week, the companies presented in essence their November 4 package with not an iota of movement on any of the issues that matter to writers.
Thursday morning, the first new proposal was finally presented to us. It dealt only with streaming and made-for-Internet jurisdiction, and it amounts to a massive rollback.
From streaming television episodes, the companies proposed a residual structure of a single fixed payment of less than $250 for a year's reuse of an hour-long program (compared to over $20,000 payable for a network rerun). For theatrical product they are offering no residuals whatsoever for streaming.
For made-for-Internet material, they offered minimums that would allow a studio to produce up to a 15 minute episode of network-derived web content for a script fee of $1300. They continued to refuse to grant jurisdiction over original content for the Internet.
In their new proposal, they made absolutely no move on the download formula (which they propose to pay at the DVD rate), and continue to assert that they can deem any reuse "promotional," and pay no residual (even if they replay the entire film or TV episode and even if they make money).
The AMPTP says it will have additional proposals to make but, as of Thursday evening, they have not been presented to us. We are scheduled to meet with them again on Tuesday.
In the meantime, I felt it was essential to update you accurately on where negotiations stood. On Wednesday we presented a comprehensive economic justification for our proposals. Our entire package would cost this industry $151 million over three years. That's a little over a 3% increase in writer earnings each year, while company revenues are projected to grow at a rate of 10%. We are falling behind.
For Sony, this entire deal would cost $1.68 million per year. For Disney $6.25 million. Paramount and CBS would each pay about $4.66 million, Warner about $11.2 million, Fox $6.04 million, and NBC/Universal $7.44 million. MGM would pay $320,000 and the entire universe of remaining companies would assume the remainder of about $8.3 million per year. As we've stated repeatedly, our proposals are more than reasonable and the companies have no excuse for denying it.
The AMPTP's intractability is dispiriting news but it must also be motivating. Any movement on the part of these multinational conglomerates has been the result of the collective action of our membership, with the support of SAG, other unions, supportive politicians, and the general public. We must fight on, returning to the lines on Monday in force to make it clear that we will not back down, that we will not accept a bad deal, and that we are all in this together.
Patric M. Verrone