December 5, 2007 / 3:02 AM / in 10 years

Striking writers, studios renew talks as hopes fade

LOS ANGELES (Reuters) - Striking film and television writers returned to the bargaining table with studio executives on Tuesday amid fading optimism for a speedy settlement to Hollywood’s worst labor crisis in 20 years.

<p>Supporters and members of the Writers Guild of America picket outside the News Corp building in New York, December 4, 2007. REUTERS/Shannon Stapleton</p>

The two sides resumed contract negotiations as 10,500 members of the Writers Guild of America hit the one-month mark of a walkout that has idled production on dozens of TV shows and several high-profile movies, including a planned sequel to “The Da Vinci Code.”

Prospects for a quick deal seemed to soar when the parties agreed last month to renew formal negotiations for the first time since the strike began on November 5 after months of rancor over how much writers should be paid for their work on the Internet.

But hopes were soon dashed as the resulting four-day round of talks ended last Thursday with union leaders lifting a media blackout to sharply criticize a management offer touted by the studios as groundbreaking.

Studio executives reacted with dismay, disparaging union leaders in a wave of published but anonymous comments as being more interested in stoking antagonism than in making a deal.

The studios’ bargaining entity, the Alliance of Motion Picture and Television Producers, struck a more conciliatory tone in an open letter that ran on Tuesday as an advertisement in the entertainment trade paper Daily Variety.

“Ours is not a ‘take it or leave it’ offer,” the AMPTP statement said. “It is designed to allow both sides to engage in the kind of substantive give-and-take negotiation that can lead to common ground.”

The WGA was expected this week to present a counteroffer.

A STICKY WEB

The outcome of the negotiations hinge on writers’ demands for a greater share of revenue for content distributed via the Internet, widely seen as the delivery pipeline of choice for most filmed entertainment in the not too distant future.

On the surface, the two sides do not appear that far apart in terms of sheer dollar figures.

The AMPTP puts the entire value of its compensation package at more than $130 million in new earnings for writers over three years. The union said its own plan would cost the film and TV industry $151 million over three years, amounting to a 3 percent increase in writers’ collective annual earnings.

But the two sides are not necessarily taking each other’s proposals at face value. The WGA on Tuesday challenged the studios’ numbers, putting its own tally of proposed gains under the AMPTP package at just $32 million over three years.

“We don’t see how their proposal adds up to anywhere near $130 million,” John Bowman, chairman of the WGA negotiating committee, said in a letter to members.

Experts say much of the disconnect stems from the abstract nature of new-media economics.

“The degree of uncertainty here is frightening for both parties,” said entertainment lawyer Jonathan Handel, a former WGA co-counsel. “It makes it very difficult to even agree on the landscape that’s being discussed.”

Speaking at a New York investors conference on Tuesday, CBS Corp. chief executive Leslie Moonves said studios wanted to reach a deal with writers to “share in the pie,” but “right now, we don’t know what that pie is.”

The guild insists the studios know enough already about the commercial value of Internet content and are being too stingy.

For example, the union has faulted the studios’ offer to pay writers a single, fixed fee of $250 a year for an hourlong TV series episode when streamed over the Internet, and nothing at all if it streams for just six weeks.

The WGA says that amounts to a tiny fraction of more than $20,000 in “residual” fees writers now stand to earn for network repeats, though both sides acknowledge that shows are being rerun less frequently on commercial TV.

According to the WGA, the studios also want a “promotional use” waiver that allows them to stream feature films and TV shows in their entirety without paying writers anything.

Moreover, the writers say the studios still refuse to establish a payment scheme for original content created especially for the Internet, or to go beyond their initial offer to pay the same rates for digital downloads as for DVDs.

Reuters/Nielsen

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