The Writers Guild of America position

For writers, a simple principle lies at the heart of discussions of new or non-traditional media such as the internet, mobile phones and other digital platforms. "If the companies get paid, we get paid. That's our view," explains WGA West executive director and lead negotiator David Young. "If they don't make money, writers don't make money."

Rather than getting into an examination of different new media technologies and business models, the guild wants to focus on the idea that labour costs are part of the cost of doing business in any sphere.

"Whatever technology wins out, the companies are going to make money from it and when they make that money we get our fair share," says Young.

And that should include a share, say the writers, of revenue from any advertising attached to web material the studios and networks characterise as merely promotional. The guild wants to get the same 2% residual on free streaming video as it gets on cable TV sales.

Writers and producers made some headway on new media issues in their 2001 contract, which gave labour a 1.2% residual - following the model for pay-TV sales - on the licensing agreements for the download rental of material over the internet.

Now the guild wants the same pay-TV residual formula for sales of films and TV shows downloaded over the internet. Early download sale deals have only offered labour the much lower home-video residual rate.


Studios and networks argue it is too early to know what kinds of revenues and costs will be associated with new media distribution and the issue therefore needs more study. Precedents for that approach have been set, employers say, in recent agreements between advertisers and SAG, and US film and TV companies and the Canadian actors' unions (see p18).

"The history of bargaining in this industry," says Amptp president and chief negotiator Nicholas Counter, "has been that at the appropriate point in time the bargaining parties have worked out compensation formulas based on known business models. In this case, the landscape of new media is changing every day. At an appropriate time we're willing to deal this out, but we think it's too soon."

The Amptp claims the WGA has reneged - in, for example, its dispute with NBC - on an agreement reached during 2001 contract talks that allowed companies to individually negotiate with writers regarding compensation (with a percentage going to the guild's health and pension plan) for additional work on internet material.

The most important use of new delivery mechanisms, Counter maintains, is "to promote our programming, both for the purposes of retaining audience and recapturing audience". The purpose of distributing a TV show or associated 'webisode' over the internet, he says, is to retain the audience for the show: "The mere fact there may be advertising embedded in that webisode, let's say, does not generate additional compensation for anybody. It's retaining the audience and that's good for writers as well as producers."

On internet download sales, or so-called 'electronic sell-through', the Amptp companies believe the most analogous residual formula is the royalty-based home-video formula.