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Hollywood writers may strike over online royalties

23 October 2007 11:17 by Rich "vurbal" Fiscus | 4 comments

You may have heard that Writers Guild of America (WGA) members have voted to authorize a strike at month's end after months of failed negotiations with the Alliance of Motion Picture and Television Producers (AMPTP). What isn't as well publicized is that one point of contention is royalty arrangements for online TV show distribution.

The problem appears to be that content providers want to use online distribution as an excuse to pay less for the same product. They've suggested paying royalties as if internet television were the same as home video, which would result in lower royalties for distributing recently aired TV shows online than airing them on television.

The problem is that model doesn't accurately represent the public's viewing habits. While there are certainly a small number of consumers renting or purchasing older TV episodes online, by far the biggest market segment for online TV viewing consists of people watching content from within the last few weeks, which is the same model most television networks are using to determine what to provide free on their websites.

John Bowman, chair of the WGA negotiating committee says that it makes sense for payments to be at least as high for distribution on the internet, Cell phones, and other new and expanding outlets as they are for traditional TV broadcasting. "Management, however, has refused to accept this interpretation, and has even threatened to do away with residuals altogether in this new medium, or to impose the outdated and unfair home video formula," said Bowman in a statement. "Given that residual income can amount to between 20 to 50 percent of a writer's income, we clearly can't allow management unilaterally to dictate this most essential contract term."

The producers are playing down the strike vote. AMPTP president Nick Counter issued a statement of his own, saying "a strike authorization vote is a pro forma tactic used by every union in the country and usually the vote is overwhelmingly in favor of a strike. We are not surprised with the outcome of this vote, given reports of how this election was conducted. Our focus is on negotiating a reasonable agreement with the WGA."

Source: Ars Technica

Permalink to this article

Labels tell artists 'we gave your money to our lawyers' (2 March 2008)

Directors guild starts negotiations in Hollywood (12 January 2008)

YouTube signs royalty deal for the UK (30 August 2007)

RIAA seeks lower royalties for music publishers and songwriters (10 December 2006)

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Discuss this article!
maryjayne (Junior Member) 24 October 2007 11:16
The royalties for internet TV vs. regular TV should be different. I could see them being the same if internet TV was high definition quality or at least close to regular TV quality. [ + quote]
justme81 (Newbie) 24 October 2007 13:34
The content is the same why should how a customer views that content matter? [ + quote]
borhan9 (AfterDawn Addict) 24 October 2007 17:23
I said it before ill say it again ill take the line used by John Stosil and say "give me a break" :P [ + quote]
Mez (Senior Member) 26 October 2007 8:32
It is just another example of the Media Maffia protecting artists rights again. They screw the artists way more than the pirates because they are taking away real money vs pie in the sky money. Why should the artists take a pay cut because someone sees somthing on the internet vs the TV? Maybe they ought to also get a cut in pay if more than one TV is on in a house? [ + quote]