HRH-Tube

In a first for the British monarchy - and perhaps kings and queens everywhere - Queen Elizabeth II has posted her 2007 Christmas Message on YouTube. The religious tone may not be for everyone, but that fact that this tradition-bound establishment now has its own channel on YouTube is quite something.

Now, I don't imagine HRH posted the video herself, but her handlers did. She probably doesn't have email either. QEII@hotmail.com? I doubt it.

Nonetheless, quite a change for a Queen who 10 years ago was tone deaf to public reaction over Princess Diana's death.

The Guilds Will Survive

Kevin Morris and Glenn C. Altschuler have an Op-Ed piece in today's Los Angeles Times in which they predict the demise of the Hollywood guilds, or at least, of the WGA and SAG. Their scenario is that massive numbers of primarily high-earning writers and actors - screen writers, television show runners, movie stars and celebs - go financial core, weakening the guilds beyond recognition.

"Financial core," for those not attuned to the vagaries of labor law, is a status in which members withdraw their formal membership in the guild (as far as the guild is concerned), but are still considered guild members for legal purposes. See NLRB. v. General Motors, 373 U.S. 734 (1963) and CWA v. Beck, 487 U.S. 735, 745 (1988), both of which are Supreme Court cases.

Under the law, Fi-Core members are no longer subject to guild discipline, and can thus cross guild picket lines to work during a strike. The can also work non-union as well as union jobs, and continue to receive all benefits of guild membership, when they work a union job. They also continue to pay almost full guild dues.

Since Fi-Core members can work during a strike, the guilds would lose enormous leverage. This is because the guilds would lose the ability to shut down the industry. Production would restart, and the guild becomes a mere echo of its former self. The guilds become organizations of the disenfranchised - non-working writers and actors, and those whose stature in the industry commands only low wages. Eventually even they begin to defect. The guild survives (because Fi-Core members pay dues), but loses the ability to strike, and thus to bargain effectively.

This sounds pretty awful. But, there's a flaw in the argument: show runners and screen writers would no doubt threaten to change their status to Fi-Core go to the WGA in massive numbers before actually doing so (likewise as to celebs and stars with respect to SAG). This is exactly what ended the 1988 strike. At that point, even the hardline guild leadership would probably listen. There would probably also be a movement among the rank-and-file to go Fi-Core as well.

As the Op-Ed piece points out, this doomsday scenario could happen. But will it? Probably not. Before it does, more moderate heads in the guild will prevail. Self-preservation is a strong instinct.

This article first appeared in the Huffington Post.

WGA Strike: A More Optimistic Scenario

Here's a more optimistic scenario than my recent prediction. It's all speculation, but maybe this is a pathway to a solution:

1. The DGA does a deal on new media residuals that's close to what the WGA wants (due in part to pressure from the WGA, as well as, of course, due to its own hard work, leverage and research), but not quite what the WGA is looking for.

2. WGA leadership rejects the DGA deal as a template, but returns to the bargaining table, perhaps by conceding on reality, animation and sympathy strikes.

3. SAG leadership, meanwhile, rejects the DGA deal even more strenuously.

4. The WGA achieves a slight improvement in the new media formulas, in part by pointing out that SAG will be even harder for the AMPTP to deal with. The WGA concedes on reality, animation and sympathy strikes (if it hadn't already in step 2), and also confidentially promises to sell the new media deal to SAG leadership. See also my suggested resolution for other deal points. The AMPTP concedes on other issues to close a deal and avoid the horror show of two guilds on strike.

5. The DGA would probably have a "favored nations" clause in its deal requiring the AMPTP to offer it any improved deal. So, the AMPTP grants the DGA, as well as SAG, the benefit of the improved new media formula.

This scenario allows everyone to claim victory and save face - the DGA gets to make the deal, the WGA gets to improve on it, SAG gets to help close the new media deal and also avoid a strike, and the AMPTP gets significant concessions. Here's hoping.

Tip of the hat to the anonymous friend who helped me brainstorm this scenario.

This article originally appeared on the Huffington Post today.

International Outsourcing to Evade the Strike

NBC is planning to run shows produced overseas, written by non-WGA writers, reports the Wall Street Journal. This is in addition to NBC's and CBS's plans to re-cut, then rerun, shows from their sister cable networks.

This makes it all the more important that the WGA hold firm on its little-discussed "Industry Standards" proposal. That proposal would require that all subcontracting by signatory companies be subject to the terms of the MBA (the Guild agreement with the companies), which would discourage such subcontracting.

However, since the guild agreement has expired, this provision would do nothing to prevent such subcontracting now, so far as I know. Hopefully, the Guild-organized solidarity marches last month will discourage such writing.

Holiday Wishes

On a personal note, I want to send my thoughts and best wishes to everyone affected by the strike - writers, actors, directors, below-the-line workers, and suppliers and service providers within and outside the industry, as well as those executives who'd prefer to be working with the writers rather than in opposition to them. This is a difficult time for many people, but it will eventually pass - sooner rather than later, one hopes.

NLRB to be Slow as Molasses

The NLRB review of the WGA charges filed against the AMPTP is likely to involve special review by the agency's Washington office, says the Hollywood Reporter. This will make the process even slower than normal, increasing the likelihood (as I previously blogged) that the agency review will come long after the DGA has concluded a deal.

Strike $ Impact

LA County economist Jack Kyser told the City Council this morning that the strike has cost the local economy $220 million to date, reports Variety's strike blog. Steve MacDonald, head of Film LA (film permitting organization), told the council the strike is costing $135 million in lost production spending and has cost about 10,000 jobs, the blog reports. Production on 71 TV shows has shut down.

Corporate Tool

No, not the AMPTP. (Well, not just the AMPTP.) This time, I'm talking about Kevin Martin, the preppy-boy chairman of the FCC. At his initiative, and on an a 3-2 vote (and apparently without public hearings), the FCC just relaxed newspaper-TV cross-ownership rules, reports the LA Times. That move makes it easier for a media company to own both a newspaper and a TV station in the same market.

More media consolidation - what a perfect gift for the holidays.

Feedback, Please

It'd be great to get feedback on the blog - is it useful, how does it compare to other media coverage and blogs you're reading etc. You can email me at jhandel@att.net, or post a comment on this article.

Extensive Interview

I'm the subject of an extensive interview today in Media Life, where I offered thoughts on the anticipated length of the WGA strike, roadblocks to negotiation, and the viewpoint of other unions.

Wedge Issue in the Hollywood Strike: New Media Residuals

The directors guild (DGA) and writers guild (WGA) are meeting soon to discuss new media. That's a hopeful sign, but does it mean the WGA leadership is likely to support the new media deal that the DGA and studios ultimately agree to? Maybe not, for several reasons.

First, as I've previously discussed, the WGA leadership may be subjected to scathing criticism if it looks at the DGA's deal and simply says, "yes, I'll have one of those too." (See WGA Strike: How to Restart the Talks, And Why, section entitled "Why It's Important to Do a Deal Before the DGA Does"). Rightly or wrongly, people will question whether a bruising strike was necessary at all; why not simply have worked without a contract for a few months instead, and let the DGA do their deal?

Second, the DGA places less emphasis on residuals than the WGA or SAG do (see sec. (1) of Writers' Strike: Why They're Talking). This means that the DGA will probably emphasize other issues, such as compensation minimums, somewhat at the expense of new media residuals, in the eyes of the other WGA and screen actors guild (SAG).

Third, each new media residual dollar that the DGA obtains will cost the studios more than twelve dollars. That's because, if the DGA deal on new media residuals serves as a template, the studios would have to pay corresponding amounts to the other unions: in other words, $1 to the DGA means also paying $1 to the WGA, $3 to SAG (there's a 3x multiplier), $4.50 (a 4.5x multiplier) to the IA (the IATSE, which is the union that represents technicians and craftspeople), and around $3 (another 3x multiplier) to the AF of M (musicians union). See Reflections on Residuals: Go Forth and Multiply for discussion of this phenomenon, called pattern bargaining.

Those multipliers are definitely a problem, because they create a wedge that the AMPTP (studio negotiators) can exploit between the DGA and the other two unions. For instance, suppose the DGA were to say to the AMPTP during negotiations "give us $10 more in new media residuals, and, by the way, we know the WGA would probably be happy with this amount too." Sounds nice. However, the AMPTP would look at this proposal and realize that the actual cost to the studios would be more than $120, because of those multipliers.

In response, the AMPTP might say, "no way, but we'll instead give you $50 in additional minimum compensation" (the money that gets paid to a director upfront). In that scenario, the DGA gets more than it asked for ($50 rather than $10), but the other guilds and unions get nothing, because minimums are not mirrored across the various guild and union agreements.

In other words, there's no pattern bargaining, and no multiplier effect, when it comes to minimums or other non-residuals issues. Thus, the AMPTP is more willing to give a dollar on a non-residual issue than on residuals. And - as mentioned above - those non-residual issues are precisely the ones that are somewhat more important to the DGA anyway.

So, the DGA might well accept the AMPTP counteroffer, since $50 is a lot more than $10. Now, that's no criticism of the DGA. Its duty is to represent its members. And, of course, the DGA are not pushovers, and they come to the table armed with almost $2 million worth of research on new media issues, plus a veteran entertainment lawyer, Ken Ziffren, as a consultant. But this "wedge issue" does create a problem when it comes time to sell the new media deal to the other two guilds.

The resolution to this problem has less to do with math and more to do with words: if there are no words on the page, there's nothing to direct. And if there are no actors to speak those words, there's still nothing to direct. Nothing to direct means no work for the DGA member. So, the DGA will need to balance its members' on-paper financial interest with the real-world scenario of one or even both of its sister guilds on strike.

At the end of the day, the DGA and the AMPTP will reach a compromise that, hopefully, incorporates the interests of the other two guilds indirectly as well. In our example, perhaps the DGA and AMPTP would agree on a $5 increase in new media residuals plus a $15 increase in DGA minimums. That would be a $20 total increase for the DGA (better than $10, though worse than $50), a $5 increase for the WGA (better than nothing, but not as good as $10), and corresponding increases for the other guilds in accordance with those multipliers. The cost to the AMPTP would be $75 ($5 times twelve, plus $15), which is not as costly as $120 but is more so than $50.

The key, then, is for the DGA - as well as the AMPTP - to believe that the WGA is serious about the strike, and willing to stay out for months no matter what the loss of income to writers, directors or others (actors, IA, and everyone else). That's a brutal truth, but with direct talks between the WGA and AMPTP stalled, keeping the DGA under pressure may be the WGA's only option.

This article was first published on the Huffington Post on December 18, 2007.

WGA Strike: How to Restart the Talks, And Why

There may still be time – a small window at best – to negotiate a solution to the WGA strike before the DGA does its deal. How might this be done, what’s the deal the WGA and AMPTP should do, and what will happen if the DGA does negotiate a deal first? Read on; but first, some background.

Background

The WGA’s trying to compel the AMPTP to return to the table by filing charges with the National Labor Relations Board (NLRB). This might work, since three of the AMPTP’s non-negotiable demands (“roadblocks”) – distributor’s gross, fair market value and, arguably, industry standards – relate to compensation, which is a subject of mandatory bargaining under the National Labor Relations Act, 29 U.S.C. §§ 158(a)(5) & (d). A caveat – although I’ve spoken to several labor lawyers (both pro-labor and pro-management) on the issues discussed in this section, I’m not one myself.

Thus, the AMPTP in my view has no right to walk out on talks over two or perhaps all three of those issues, at least until an impasse is reached. Given the apparently desultory nature of the negotiations so far, this does not yet appear to be the case. (See WGA Strike - Negotiation Issues (sec. 2(a) of memo) for explanation of the AMPTP’s roadblocks.)

The problem with the charges, however, according to at least one labor lawyer I spoke with, is that the process is so slow that the DGA will probably be done negotiating before a final decision on the charges is reached.

The WGA is also trying to force each of the companies – the 6 majors plus CBS, at least – to negotiate separately, notwithstanding that they usually negotiate as a multi-employer bargaining unit, the AMPTP. I’ve not yet had a chance to research this issue.

However, as a strategic matter, the charges that the WGA filed with the NLRB make the AMPTP, and the companies individually, less likely to bargain voluntarily, because now they would seem to be caving to legal pressure. That’s not good, and that’s why I called the charges “ill-advised” in an AP story. (I also called the charges “inflammatory,” which was probably a bit strong.) The charges also probably all but destroyed back-channel efforts to restart talks.

In any case, if the Guild leadership does have legal justification for forcing individual negotiations, it should have taken this tack months ago, before alienating the companies with invective and legal charges. This move would have resonated with the public from day one, because almost everyone outside the companies is concerned that media conglomerates have grown too big and too powerful. Even some Republican members of Congress have expressed misgivings.

Moreover, at least two of the WGA’s demands – jurisdiction over reality and over animation – are not subject to mandatory bargaining, according to three labor lawyers with whom I spoke. These issues are two of the AMPTP’s six roadblocks. Thus, the WGA has no right to force the AMPTP to bargain over these issues.

Why does the Guild care so much about reality? In my view, it’s primarily so that the Guild can choke off reality as well as scripted product the next time that negotiations take place, in three years. With no access to reality, the networks would have nothing to substitute for scripted programming in the event of a strike, whereas, this time around, such substitution is exactly what we’ll see starting next month.

That would be great for the Guild, but such extreme loss of leverage is unacceptable to the companies. Pigs could sprout wings and fly up and down Wilshire Boulevard, and the Guild would never get this jurisdiction. Not now, not ever.

There’s another reason the companies won’t grant jurisdiction, and that’s because the IA is organizing reality already, more successfully than the Guild, in fact. The companies won’t step into an inter-union fight – and if they did, they’d favor the IA, because it’s a larger, more powerful union, and because it apparently tends to drive an easier bargain.

This latter point applies to animation as well, which the IA has organized for many years, although the Guild has also had some success. Nonetheless, this area doesn’t affect many existing WGA members, and it’s hard to escape the conclusion that the focus on animation is due to the occupation of the Guild president, Patric Verrone (hint: he’s an animation writer).

The sixth roadblock, the Guild’s demand that it be allowed to honor another union’s picket lines, such as SAG’s, may or may not be subject to mandatory bargaining; my quick research suggests the matter is unclear. Nonetheless, such a sympathy strike provision is completely unacceptable to the companies, since labor peace is a key benefit of the bargain for the companies when they sign a union agreement. This is another non-starter.

How to Restart Talks

So, what to do? The companies started this mess by presenting incendiary proposals in July and sticking to them for months. The Guild’s not blameless either; it’s pushed for reality and animation since July as well. Since then, both parties have deployed vitriol in equal proportions, and, by most reports, negotiating sessions have been marked by lectures, inefficiency and infantile pranks more often than serious negotiation.

At this juncture, the AMPTP is to blame for walking out, and the Guild should keep up the pressure on companies to bargain individually. The AMPTP is structurally a problem – each of the companies has a veto right, which means that hardliners may prevail for quite some time. Moreover, the AMPTP’s president and chief negotiator, Nick Counter, reports to the CEO’s of all eight or so member companies. That situation inherently breeds caution and stalemate, ensuring that Counter will resist Guild demands even if there were some he’d otherwise be inclined to agree to (which there may not be, however).

So, unfortunate though it may be, to restart talks, the Guild will need to take a bold step: accede to three of the AMPTP’s demands and drop reality, animation and sympathy strikes. The WGA’s never going to get these, and everyone knows it. Indeed, Verrone recently began to back down on reality, stating that "It's not a sticking point . . . there is room to negotiate." Without these steps, the companies and the AMPTP are unlikely to return to the bargaining table in time to head off the DGA.

The Guild should also step up the pressure to make writers less dependent on the studios in new media. Training classes on technology, software, business models and entrepreneurship; negotiated discounts on software; awards to foster new media creation – all of these steps should have been taken at least a year ago, but better late than never.

What’s the Deal They Should Make?

Here are key points to the deal the parties should make:

* Guild’s Proposals re Reality, Animation and Sympathy Strikes. Not happening.

* Industry Standards. This is the Guild’s proposal that, if the companies subcontract work, the sub will have to comply with the guild agreement’s requirements. Completely reasonable; otherwise, subcontracting becomes a hole in the agreement big enough to drive a Teamster’s truck through.

* Fair Market Value. This is the Guild’s proposal that self-dealing transactions – such as program licensing deals between two divisions of the same conglomerate – be valued at fair market value, in order to protect residuals from being artificially depressed. Also reasonable. But, the companies are concerned that an overzealous arbitrator could dramatically overvalue a transaction, creating disproportionate liability for the company. That would create uncertainty for business projections and financial statements. My compromise: cap the increase in value the arbitrator is permitted to impose. The Guild gets a degree of fairness, and the companies get a degree of risk protection.

* New Media Residuals. See WGA Strike - Negotiation Issues (secs. 3(b) & 4 of memo) for my proposals. Distributor’s gross is one component of the new media residuals issue. The Guild will probably have to compromise here.

* Other Issues. See WGA Strike - Negotiation Issues (sec. 6 & Ex. A of memo) for details.

* Tri-Guild New Media Adjustment Committee. The revised Guild agreement should establish a Tri-Guild New Media Adjustment Committee. See Memo to DGA - Please Propose a Tri-Guild New Media Adjustment Committee.

* DVD Residuals. The Guild was seeking to double the DVD residual, but has withdrawn this proposal (and publicly confirmed the withdrawal). This removes a major impediment to a deal, although I think it’s a mistake. See Slipped Disc: Why DVD Residuals Still Matter — and Always Will.

Why It’s Important to Do a Deal Before the DGA Does

If the DGA negotiates first – it’s planning to commence negotiations in early January – it will probably conclude a deal promptly. Since the DGA cares less about residuals than the WGA or SAG do (see sec. (1) of Writers' Strike: Why They're Talking), the DGA’s deal on residuals will probably be unacceptable to both of the sister guilds (the DGA will trade for a better deal on other issues). The WGA, for its part, has already signaled as much, stating “We wish [the DGA] well [in its talks], but they do not represent writers. Our strike will end when the companies return to negotiations and make a fair deal with the WGA.”

In addition, after more than two months of a bruising strike, it will seem untenable to the WGA leadership to admit that the DGA was able to accomplish what the WGA couldn’t. The WGA’s already trying to defuse this issue by arguing that the WGA has “softened up” the AMPTP for the DGA to strike a decisive blow, but the loss of face would nonetheless be real.

More importantly, the criticism from the IA and other sectors of the industry – including WGA members themselves – would be loud and unrelenting, and could even result in a movement to oust the leadership in the next election. In fact, such a movement is likely unless the WGA achieves significant gains. The WGA leadership is playing a high-stakes game, and has painted itself into a corner that may turn out to be the edge of a precipice.

Thus, I fear that both the WGA and SAG will reject the DGA deal. The WGA leadership will urge its members to hold on and keep the faith until the cavalry arrives, in the form of the 120,000-strong SAG, which will be free to strike after June 30, when its contract expires. We’ll then face the prospect of both of those guilds on strike, arrayed against the DGA, as well as the IA (which has consistently criticized the strike and the WGA’s leadership) and probably the Teamsters (whose support has apparently slipped away in the last few weeks).

The WGA leadership is betting that this approach will bring the companies not just to the bargaining table, but to their knees. The companies are likely, however, to continue to resist, because the financial structure of their businesses are at stake. Maybe this approach will work nonetheless – but it’s a scorched earth policy that could bring the entire industry to the brink of ruin. How much better it would have been for both parties to have negotiated reasonably from the beginning. What a disgrace.

This article first appeared on the Huffington Post on December 17, 2007.

Memo to DGA - Please Propose a Tri-Guild New Media Adjustment Committee

Since the WGA negotiations have devolved into nuclear winter, it looks like the next move will be talks between the studios and the DGA. Here's a suggestion/request for the directors: please include, in your proposal to the studios, a tri-guild New Media Adjustment Committee.

What does that mean?

"Tri-guild" - the committee should have members from management and from all three above-the-line guilds (WGA, DGA, SAG), assuming each guild ratifies a similar contract proposal (so that all three guild agreements would contain the same language establishing the committee). The committee might also have members from the IA (IATSE represents many below-the-line workers, i.e. craftspeople), AFTRA (a performers union), and AF of M (musicians union), both of which also have new media issues (since both also receive residuals); however, these latter two unions haven't generally been part of multi-guild committees in the entertainment industry. The committee should also have more-or-less non-aligned members from the legal and agency world, academia, and elsewhere.

"New Media" - the committee's focus would be the issues associated with new media.

"Adjustment Committee" - the committee would have the power to propose and pre-negotiate changes to the WGA, DGA and SAG agreements, so that new media issues aren't dealt with in an almost-indigestible lump on the eve of (or after) contract expiration, which is part of what led to the current, bitter strike.

The committee should meet quarterly or even monthly. It will need research support (sharing of data) from all parties, and a small budget for purchase of research reports and other such expenses. The committee would build relationships with major players and information sources (agencies, attorneys, other guilds, academics, research firms, tech cos., etc.).

The WGA had a Contract Adjustment Committee in the 1990's, with a general focus (it had nothing in particular to do with new media), but I understand that it was not very effective. This time the stakes are higher, because technological change, like the Terminator, will never stop.

This means more of what we've been seeing for the last 10 years: software keeps evolving, business models keep changing, hardware gets smaller, faster and cheaper, data capacities and transmission speeds increase, new web sites spring up overnight with instant audiences, and new technologies are developed on a regular basis.

Where all this leads is unknown, but one thing is clear: Silicon Valley is not going to suddenly take an Ambien and stop innovating. Yet, when it comes to guild agreements, the entertainment industry seems content to snooze between contract renewals.

The guild agreements are multi-hundred page accretions of hard-fought gains, historical accidents, and tough compromises. Unless the entertainment industry establishes a mechanism to modify those contracts on an ongoing basis - rather than attempting to do so under looming deadlines - we may face repeated strikes and near strikes (de facto strikes) at regular, three-year intervals. The 2007 strike is no fun, to put it mildly. Do we really want the same thing in 2010 as well?

DD CGI CO TO IPO

Digital Domain, a major visual effects company (CGI, Computer Generated Imagery aka Computer Graphics Imagery), has filed for an IPO, reports socalTECH.com. They're looking to raise $100M.

"Don't Touch My Body (of Work)!" Vivid Tells PornoTube

Vivid Video, a major adult video producer, is suing PornoTube, a YouTube knockoff, reports the LA Times. The suit alleges that Vivid's copyrighted content is available on PornoTube. Suit is conceptually similar to the Viacom suit against YouTube and Google.

The LA Times story also notes in passing that the widespread availability of free short clips on the Web hurts porn producers (whose content is often long-form) because "consumers of adult fare often get what they are looking for in clips of five minutes or less." Indeed.

Vudu Works Its Magic, Releases HD Movies Day-and-Date With HD DVD and Blu-ray

For the first time, a movie will be available (legally) in electronic form on the same day it's released on physical media, the LA Times/AP reports.

The movie is The Bourne Ultimatum, and it will be available this Tuesday in high-def on the Vudu box - a hybrid download/streaming device - the same day as the DVD is released. The film industry term for this is a "day-and-date" release.

Usually, electronic releases are not available until the pay-per-view or pay-TV window, which is usually a month or so after the DVD release. Most such releases are in download or streaming form via the Internet, whereas Vudu is a somewhat unique device that attaches to the television set.

Still, if the experiment is successful, it could lead the way to accelerated online delivery of more films - a development that the big DVD retailers (Wal-mart, Best Buy and Target) might strenuously resist, but that might be favored by download vendors such as Apple (iTunes) and Amazon.

This development will contribute to the debate over release windows - the film industry practice of releasing a movie in phases via different media - first theatrically, then DVD, then pay cable, basic cable, and finally syndication. The industry maintains that this approach maximizes revenue, while critics suggest that refusing to make films immediately available via some form of home media encourages piracy and frustrates consumers.

Interestingly, there has been some collapse of windows related to foreign release patterns. In the past, foreign theatrical releases followed domestic. Today, due to the Internet's effect on both piracy and worldwide publicity, many large "event" films ("tentpoles") are released in some international territories day-and-date with domestic.

Too Funny - AMPTP.com

If you want to visit the AMPTP website, go to AMPTP.org. But if you want to see a hilarious and sharp-tongued parody site, visit AMPTP.com, at least until the lawyers make them take it down (it may amount to cybersquatting). The first sentence on the home page sets the tone:

We are heartbroken to report that despite our best efforts, including sending them a muffin basket, making them a mix CD, and standing outside their window with a boombox blasting Peter Gabriel songs, our talks with the WGA have broken down.

There are five pages in all. The owner of the site, Tactical Edge Group's Bill Davis - an experienced prop master and armorer (weapons master for TV show and movies) - tells me he's rented the site for a limited time to a group of striking writers. He's owned the site for several years, along with several hundred others. A visit to the Internet Archive's Wayback Machine (which archives past versions of websites) shows that the site has been parked for several years. Check it out at http://web.archive.org/web/*/http://amptp.com .

Tip o' the hat to Dave McNary at Variety for mentioning the site to me.

Expanding the IP Empire

A bill introduced in the House would expand enforcement of IP laws regarding movies, fashion and other areas, reports Variety. The bill would establish an IP czar in the White House and an IP division in the Justice Dept. Too early to tell what the bill's prospects might be.

DVD + Hi Def = $20 billion in 2012

"By 2012, standard DVD discs will total $10 billion in U.S. consumer sales, HD DVD $5 billion and Blu-ray $5 billion," per Adams Media Research, as reported by Video Business.

This compares with 2006, in which DVD was a $16.5 billion business, according to the Entertainment Merchants Association trade org. (Unclear if this also includes hi def, but the difference is probably not great either way.)

That growth, even in the face of the continued hi def format war (Blu-ray vs. HD DVD), means that the WGA's failure to achieve an increase in the DVD residual (see WGA Strike - Negotiation Issues) will continue to represent a significant loss, as I previously predicted. See Slipped Disc: Why DVD Residuals Still Matter — and Always Will.

WGA Strike - Negotiation Issues

I've written a detailed memo on the current state of the proposals in the writers strike. It includes several summary sections in plain English, as well as more detailed analysis.

WGA Strike - Confusion Reigns

Let's see the proposals - the studios (AMPTP) and writers (WGA) need to release the full text of their latest proposals so the entire entertainment industry can form an informed opinion on the negotiations. Here's why:

Streaming Ad Market Worth $120m to Nets in '07

The Financial Times is reporting that the four major U.S. networks will reap $120 million in 2007 from ads connected with free streaming of their content. The number is expected to sharply increase next year. The FT's source is Starcom, described as a leading media buying agency.

The WGA wants 1.2% of such ad revenue, which suggests $1.44 million would have gone to the WGA for 2007. However, the Guild is willing to give the nets a residual-free promotional window of several days (i.e., the first several days that a particular program is available would not trigger residuals). Thus, the WGA's take would be less than the math suggests.

The cost to the nets and/or studios would be 9.5 times as much, because the residual formulas in agreements for the directors, actors and below-the-line craft workers would contain similar residuals formulas.