Newsletter

March 2007 · Newsletter Archive

"Art is not about thinking something up. It is the opposite--getting something down."
--Julia Cameron, The Artist's Way

From the Front Lines...

Hearing a few distant rumblings of whether we talent might go on STRIKE? Ooh. Them's dirty words where I come from, my friend. Leaves a bad taste in your mouth regardless which side of the fence you fall, management or labor. A strike should be the very last option--never the only option or (God forbid!) the sole modus to elicit change. Never ever! That said, this just in from the Associated Press (AP).

"Something Picket This Way Comes: Why Hollywood Talent Might Go On Strike"
by Craig Mazin, AP Business Writer

Say the word 'laborer,' and the last thing that typically comes to mind is a man in an Armani tux standing next to a woman whose necklace costs more than your house.

Even so, when you watch[ed] the Academy Awards this year, [you saw] a parade of laborers. Each actor, director and writer is in at least one of the talent labor unions--the Screen Actors Guild (SAG), the Directors Guild of America (DGA) and the Writers Guild of America (WGA). When the current WGA contract expires at the end of October, word on the street is that the writers might walk out.

Why? The only thing that really matters in Hollywood is money, and this is no exception. In this case, the battle is over residuals.

Our Story Begins...

To understand what the upcoming negotiations are about, we first need to understand the American quirk of copyright law known as "work for hire." If a person or corporation commissions an individual to create a work of authorship, the commissioner can be considered the author in law.

What this means is that writers in Hollywood aren't the legal authors of their scripts. Directors aren't the legal authors of their films. And actors aren't the legal owners of their own images.

If writers were legal owners, we would be collecting royalties, like novelists or playwrights. Since we're not, the WGA and other Hollywood unions negotiated for a royalty-mimicking system. When the work or likenesses of Hollywood laborers are reused in so-called "secondary markets" (e.g. reruns, pay-per-view, DVDs), we are paid a residual. The residual formulas vary depending on the type of reuse, but the most prominent and profitable type of reuse is home video.

Rather than addressing residuals on a per-employee basis, the formulas are instead hammered out on an industry-wide basis. Every three years, the big talent unions sit down to negotiate a minimum basic agreement (MBA) with the studios and networks, who are represented by a trade association known as the Alliance of Motion Picture and Television Producers (AMPTP). The MBA contains the formulas for residuals, and so it's the MBA that becomes a flashpoint when new markets emerge.

In 1988, failed negotiations over home video residuals led to the longest strike in Hollywood history. The WGA walked a picket line for nearly six months, largely shutting down television and film production in their fight for a fair share of the booming VHS market.

The writers lost.

The failure of the '88 strike enshrined an anemic home video formula. Under this formula, writers get about .3% (note the decimal point) of studio grosses from the VHS tapes and DVDs of the movies and television shows they author.

For nearly twenty years, resentment over this deal has simmered, nearly boiling over in the late '90s when the DVD market exploded. While the studios generated massive revenue, writers were reaping a paltry five cents for each DVD sold.

And now, with the advent of Internet downloads, a new distribution channel with the potential to dwarf the DVD market, things are getting downright nasty.

The Plot Thickens...

There are a few things labor and management agree on. When someone downloads an episode of The Office from iTunes, both sides acknowledge that this is a secondary market, both sides acknowledge this is reuse and both sides acknowledge that the studio is earning a share of the revenue generated by the download.

And that's about where the agreement ends.

In 2001, the WGA was able to make a deal guaranteeing a residual rate of 1.2% of 100% for shows and movies rented over the internet, but a sales definition seemed to remain in play.

Over the past few years, it's become increasingly obvious that Internet distribution is a key part of the future of the entertainment industry. And so, the WGA, not wanting a repeat of 1988, began preparing for a bruising battle. A relatively militant slate of leadership led by Patric Verrone was elected in 2005, and their private goal was clear: beat the companies in 2007 and not get screwed on residuals for Internet downloads.

That was not their public goal. Publicly, their goal was to strengthen the union through organizing, i.e. aggressively seeking to cover new work areas under union jurisdiction. For instance, you may have heard about the WGA's crusade to organize reality television. What struck many as a bit of retro Norma Rae-ism was anything but. The leadership of the WGA knew that if push came to shove and a strike was required to win the day in 2007, the large quantity of non-union reality television was going to mitigate the damage a walkout would do. Unfortunately, the WGA's efforts to organize reality television ended in failure (to read more about that battle, and why I believe the union was terribly misguided, go here).

The WGA thus finds itself once again in the strange position of being both the most militant union and the union with the least dangerous strike threat. It's a simple matter of production realities. If actors or directors strike, film and television instantly shuts down. Not so with screenplays, which are written well in advance of film production. In television, scripts and episodes are typically completed far before their air dates. If writers strike, film and television will shut down... one day... when the scripts run out.

So How Does It End?

The WGA negotiates first among the unions (its contract is up on October 31st). If it doesn't get the deal it wants, it has three options. It can settle, it can strike, or it can work past the expiration of the current contract.

The first option is unlikely. SAG and the DGA are both set to negotiate for a summer of '08 expiration and they both have very credible strike threats, so why should the WGA settle for a bad deal when all it will do is undercut the other unions' chances of doing better?

Plenty of ink has already been spilled over the second possibility: a strike. I think a strike is less likely than many observers assume.

Ironically, the complete and total failure of the ANTM strike may have saved us all from a bad general strike. I know the current leaders of the union. I opposed them in 2005 because I felt they were naïve and far too trusting of their own intellectual theories of how battles with the studios would actually play out.

After the ANTM debacle, I think they might have realized that I was right. Romanticism can run high among writers--we fetishize Paddy Chayevsky's Network for its fearless, media-smashing Don Quixote--but a punch to the nose can complicate delusions of rebellion.

The third option, working past the deadline, seems likeliest. If the WGA won't accept a bad deal and the companies won't offer a good one, the two sides can stop negotiating without a strike or lockout. This is precisely what happened in 2004.

If this comes to pass in '07, then all eyes will turn to SAG and the DGA. If SAG strikes, all bets are off, and the WGA will almost surely walk the line with them in support. If either SAG or the DGA makes a deal, the writers will get stuck with it for better or worse. Either way, (the WGA is) not quite the canary in a coalmine many industry writers paint us to be.

Unless...

There is one other possibility. As if the situation weren't confusing enough, there's the small matter of the business model for sales of movies and television shows over the Internet: It doesn't seem to exist.

Right now, Internet distribution is a Babel-like jumble of different price points, varying models of purchase, a lack of standard media formats and digital rights management snafus.

Once it all stabilizes and becomes as fast and common as downloading music, the companies will find out how people want to get their movies and TV shows online and what they'll pay for them. They'll find out what the real sales volume is. They'll find out what the overhead will be, whether they or third parties will distribute, whether the sales will be per unit or on a subscription basis, and so on.

Right now, they just don't know. And because they don't know, there's lots we don't know about how to establish a fair and sustainable residual structure for writers in this strange new world.

Given the lack of consensus and economic visibility, there's a strong possibility that everyone will look at each other and decide that maybe the best bet is to agree to figure this all out in 2010, when the contract expires again. But this fight over residuals has been brewing for twenty bitter years, and, be it now or later, it's going to be settled at some point. The talent knows they may never recoup what they lose in a strike, and the companies know that market instability is poisonous to their bottom line.

It's tempting to say that cooler minds will prevail, but this is Hollywood. When money's on the line, things always seem to get ugly.

I'm not sure talent really do understand how much or exactly what's at risk should we vote to strike in the next year or so. It was as clear as mud when we struck in May of 2000. People still think we went on strike for fear of losing our residuals, when in fact SAG Administration at the time intended all 3 contracts (commercial, film/tv and industrial) to be put on the same schedule and used our 'resids' as the ploy to get us there--they were willing to put them at risk to do so. In so doing, that strike nearly cost us our Union entirely. Again, a strike should never be the first and only line of defense. It's bad business. That said, Canadian talent are currently mid-strike--so here's the latest from the North.

"Strike nearly 'nail in coffin' for Canada's entertainment industry, say experts"
by Allison Jones for The Canadian Press, Sat Feb 24

A bitter six-week labour dispute between Canadian actors and producers was nearly the "final nail in the coffin" for the country's already battered film and television industry, which experts say now faces a long, hard, uphill climb along the road to recovery.

The Alliance of Canadian Cinema, Television and Radio Artists went on strike Jan. 8 and later extended their protest to Quebec, Saskatchewan and Manitoba.

The dispute, which focused on wages and how actors should be compensated for work across new media platforms, lasted for more than six weeks before a tentative agreement was announced last week, to the collective relief of an industry that observers say has suffered a substantial blow.

"This labour dispute drove a lot of business away from here and it's going to take time to bring it back," said John Barrack, the national executive vice-president for the Canadian Film and Television Production Association and chief negotiator during the strike.

"Productions are planned six months to a year in advance and the labour instability hurts, so it's going to take some time for that work to come back."

But Paul Bronfman, chairman and CEO for The Comweb Group, said the strike was just the latest problem for an industry that was already reeling from a number of other factors.

"The strike certainly was almost the final nail in the coffin," said Bronfman, speaking from the CFTPA's conference in Ottawa.

"That basically held everybody hostage...right now (the industry) is being taken off life support and it's going to take us months to recover from this fiasco."

It's unclear exactly how much money was lost due to the strike, though the experts agree a number of American productions took one look at the labour unrest and decided to film elsewhere. Toronto, the heart of Canada's film industry, lost an estimated $400 million in production revenue.

A strong Canadian dollar relative to its U.S. counterpart has also made Canada less appealing to U.S. producers.

But what has really hurt the industry is the very thing that once gave it life, said Keil.

"Various incentives and tax breaks made Canada an appealing place to do business," he said. Then, "other municipalities (in the U.S.) figured out that they too could offer competitive tax incentives."

With jurisdictions outside Canada constantly upping the ante, Hollywood North has had a difficult time competing.

"Given that the (American) studios will be presumably beginning to stockpile productions looking forward to the potential for a Writers Guild of America or Screen Actors Guild strike in the U.S., I think we'll see increased production in Ontario."

For the record, we Yanks are honoring the Canadian strike with hopes they'd do the same for us should we find ourselves in a similar position in the not too distant future.

Hear, Hear!

"For studios, diversity a capital idea"
by Gary Gentile, AP Business Writer, Thu Feb 22

The increasing inclusion of actors from around the world in the casts of Hollywood films is not only a nod to globalism, it's good business.

The 2007 slate of Academy Award nominees is the most ethnically diverse ever, reflecting booming movie ticket sales around the world.

The ensemble film "Babel" spans several countries and languages and produced an Oscar nomination for Japanese actress Rinko Kikuchi as well as for Mexican director Alejandro Gonzalez Inarritu and Mexican supporting actress Adriana Barraza.

Big-studio films once made the bulk of their revenues from ticket sales in the United States. But that was before movies became just another weekend alternative, competing against cable television, video games, and DVDs.

In recent years, that relationship has shifted in part because of a growing number of state-of-the-art cinemas around the world, which has increased international demand for film. American studios are making more money from the overseas box office than they do from the U.S. take, and even more from DVD sales, which are international in scope.

In 2000, for instance, Hollywood sold about $7.66 billion worth of tickets in the U.S., compared to $12.2 billion overseas, including Europe, Asia and Canada, according to the Motion Picture Association of America.

In 2005, domestic ticket sales were $8.99 billion while international sales were $14.3 billion. Hollywood has always exported American stars overseas, but also has known that international cast members can help boost profits outside the United States.

"If you put an English star in your film and your film is a mediocre film, it will still play well in the United Kingdom and in all those countries that used to be part of their empire," said Mike Fenton of Fenton Frederick Casting in Los Angeles.

At the same time, indigenous film industries have grown stronger in several foreign countries, including Mexico, Brazil, India and China.

But in recent years, (Oscar) nominations have been going to a growing number of international actors, such as the 2005 nomination of Catalina Sandino Moreno, of Colombia, for the film "Maria Full of Grace," British actress Sophie Okonedo in 2004 for "Hotel Rwanda" and Iranian-born Shohreh Aghdashloo in 2003 for "House of Sand and Fog."

Indigenous film industries, such as the bustling Bollywood scene in India, are also producing talented actors, directors and writers and that growing talent pool will eventually be reflected in American films as well.

"The industry is paying attention," Kathy Connell, producer of the SAG Awards said.

Still, it may be years before we see that diversity translate into leading roles for international stars in American films, observers say.

Especially with larger-budget pictures, studios need to hang a film's success on a bankable star and for the most part, those tend to remain familiar faces such as George Clooney, Reese Witherspoon and Denzel Washington.

Term(s) of the Month

We deviated from including 'terms of the month' as a regular feature for way too long now. So it's back. Here are 2 new entries I think you'll find rather helpful.

"device"...a conventional acting practice or means used in a script to achieve a particular dramatic effect. Spotting or creating a device allows you to establish a framework with which you can further the overall impact of the commercial, film, scene or performance.

"premise"...to establish an introduction or explanation. To further a device means to further the premise. Every script, everything you play has a premise--even if it's simply product loyalty.

Frequently Asked Q's

We're often asked, "Where can SAG members check on residuals?" Well, according to the SAG web sites FAQ: "Use our online Residuals Tracker in the Get Paid area of our site or call Residuals Payment information at (800) 205-7716 or (323) 549-6505." Good to know!

Shrop On-Line

Our trusty fellow Sound Advicer, Dave Shropshire, (lovingly known as 'Shrop') sent this in last month.

Well, it finally happened.
They are now streaming my radio station on the internet. Go to: http://www.Q106online.com
Click on the listen icon and between 3pm-8pm central time you'll hear...me.
If want to email me while I'm on the air for comments requests, etc. at: DaveShropshire@ClearChannel.com

Also, on the heels of award season, Shrop wrote in...

Don't know if you guys have this...but I thought it was kind of neat.
http://www.knightymestudios.com/flvplayer.swf?m=DLF_SAG_Awards

At last year's SAG Awards, voiceovers were acknowledged, albeit with an air of condescension. This year Kiefer Sutherland, who has consistently voiced adverts and film much like his father, Donald, narrated the segment. Of course, the general slant of the piece, beyond the multi-lingual ADR work (also known as 'looping'), reads as if only oddball character-types populate the ranks of successful voiceovers--even though the opposite is actually the truth of the matter for us rank-and-file working voiceover talent. On the average, as we stress to you here at Sound Advice, you are simply expected to be/sound like yourself.

Work is Work by Any Other Name

You guys bring up some amazing points. I get to have some of the best discussions with each of you. Here's a recent response and discussion that came as a result of last month's (January '07) Newsletter...

Kate I really don't give a [care] about the quality of the ads on the Super Bowl.  What I DO give a [care] about the fact that I booked on one of those ads and made some good money.  Why should I have to care about quality outside of my performance?  That's the producer's job. --Joe Talent

I've always said about this industry "you eat a peck a dirt a year." (And I do mean the entertainment industry--not just commercial work.) Not everything we do is going to be an award winner.
Although it would be appropriate to be able to discern the difference between effective and subpar.
So to answer your question... Because the Super Bowl has been long associated with a higher standard regarding this medium. Sorry you're offended by my input. --Kate

Kate, I wasn't offended so much as bewildered as to why you would include that article (Chicago Tribune's critique of this year's Super Bowl Ads) in your newsletter.  You run a shop that teaches people how to do everything they can to be successful in the business, and the best scenario for you and everybody who takes your classes is to book as many gigs as possible, and hopefully make a decent living doing so.  Unless you are faced with the scenario of doing work that you find morally repugnant or compromises your ethics in some way, the question of the commercial's quality never enters the picture--you just book the spot, do as good a job as you can and cash the check.  If I were the one working at the ad agency or if I was the client I could understand caring about the quality of the spot and whether the message is getting across and hitting the right target.  As the talent, I can be proud of the quality  of my work and happy that I booked the gig in the first place.  My commercial was awful, but I was seen by millions of people in my three seconds of screen time and I can't tell you how many calls I got and how many people expressed their enthusiastic congratulations at my having been on a Super Bowl commercial.  By running that article in your newsletter you kind of knocked my success, saying "Sure you got work, but the commercial wasn't any good."  In my opinion all of those people who worked on those commercials can chalk one up in the win column. --JT

Point well taken! I'm sorry you took it as knocking your success, because that's certainly not my intention. (I had a few spots running during the Super Bowl myself, for what it's worth. I'd be knocking myself as well if that were the case.)
As always I do encourage you to work and do your very best in every medium. Certainly not everything we do will even end up as work that truly defines us. Which is precisely why it's important to raise the stakes and challenge ourselves whenever possible by exposing ourselves to the next professional level and the next and so on--often without any real gradual progression. In fact, stepping up the game for ourselves always inevitably feels like a swift kick in the pants rather than an easy pill to swallow, it seems. 
That said, it's probably best to approach all this with a sense of humor. Do you recall Tom Hanks' original acceptance speech at the Oscars many years ago--his first mention was something to the effect: "This is a far cry from 'Turner & Hooch.'"
I am pleased you're booking and are proud of your work. 
I mention what works and what doesn't commercially for this and many other obvious reason not the least of which--to attempt to define the aesthetic. That and commiserating about the ads during the Super Bowl has become a national pastime. Especially for those who know little if anything about football--like myself. So, please take it in the spirit it was meant...  I wish you further success...always!

I remember Michael Caine at the Golden Globes (some years ago) when he said, "I made a lot of crap.   I also made a lot of money."  Thanks for the enlightening debate --JT

They re-ran Clint Eastwood on 'Inside the Actor's Studio' again this past weekend... he said, regarding his own career, "Take your work seriously, but not yourself." Or at least something to that effect, I'm paraphrasing. He mentioned how you'll always feel fulfilled if you keep that tenet.
Thanks for expressing your point of view, 'JT,' I'd much rather have the communication with me rather than sit and stew when something strikes you as odd or uncomfortable, my friend! --k

Wrapping It Up

This was a fairly meaty issue, eh?

By the way, we love hearing you on the air and from you directly about how things are going! And, frankly, I don't think we've heard so many of you on the air at one time as we have recently--so very well done! For those of you who are waving your fists in the air and aren't doing all that well--drop us a line, keep us informed. I'm certain we can offer you some sage advice to give your career a proper jump start. We're here to help you help yourself! In the meantime, have a terrific March! Spring's not long off now.

As always, Kate & crew