THE BLOG
02/11/2008 12:30 pm ET | Updated May 25, 2011

WGA Strike Primer: The Deal Offer

A much-shorter version of this appeared on UnitedHollywood.com, written quickly under the threat of intense deadline. Sorry for the length here -- but hey, the strike went on for 3-1/2 months. That's a lot of pavement to cover.



It was just Saturday Night at the Shrine.

As cranky WGA members met to discuss their strike-settlement offer, something remarkable occurred. Or rather, didn't. There was little ranting. The loudest sounds were repeated applause and ovations.

So much for "divisiveness"... (Not to worry, Michael Cieply of the NY Times will find someone.)

An historical note,: the Shrine Auditorium is where the Oscar ceremony was held for many years. This is either dark irony or utter whimsy.

And now at last, three questions stand out: How is the deal? Is it worth voting for? And how did Guild leadership do?

Any reaction to the deal is deeply personal. What follows is highly subjective. Your mileage might vary.

Overall, there are some surprising gains of precedent, and several important improvements over the DGA deal, but it also lacks in some serious ways that are disappointing. But I think it's a very solid offer -- not only for the deal points in total, but mostly because of the reality surrounding it. More on that later. Hold on.

Two issues leap out to me. The first is the 2% of distributor's gross for current network series, which kicks in the third year of the contract. That's remarkable. (Even more so requiring open books for tracking.) Although it has the appearances of a $1,600 cap, it's not. The $80,000 "imputed value" is a best-figured assumption of what a network show is worth when "sold" to the Internet. It's a figure for that third year only -- and it's likely high for the Internet today. Yet that value will grow in the future, perhaps even different for each show, and however high it goes, the precedent has been set for distributor's gross.

On the other extreme, the 17/24-day window is clearly a tough issue. The free window should have been tightened from the DGA deal, even eliminated, and it wasn't. However, I not only understand the need for some window (since that's how many people watch shows first-run today, on the Internet, not unlike TiVo-ing an episode to watch later), but I'm not convinced that series will only run in that free period. They could, but networks will likely keep streaming shows as long as they make money from them. If people now watch a syndicated episode of "Seinfeld" 50 times, there's no reason to assume they won't do so on the Internet, as well.

Also, as a pure guess, for at least the next few years networks won't be shifting TV reruns to the Internet because the marketplace doesn't yet justify it. (Most Internet watching today is first-run - some people won't watch a show on TV, but will catch-up on the Internet.) Whether this problematic window can be adjusted in the next contract is another matter, of course. Keep in mind, though, even without the Internet, networks have been cutting back on TV reruns. I don't say this to justify anything, just to look at the harsh landscape.

By the way, it's worth noting that there is no window for all post-1977 TV series (and some pre-1977), which will be compensated at 2% of distributor's gross from Day One. If networks put their old series on the Internet, it would all be found money under an ad-supported banner.

The "double the DVD rate" for downloading only kicks in after 100,000 units of a TV show and 50,000 units of a feature are sold, and those thresholds today are rarely met. So, that works out to being worth zero. Not good. However, and this is critical, as people move away from DVDs, downloading is likely to increase, perhaps greatly so, perhaps to the levels we see DVDs at now. In which case this improved rate is an important precedent to establish.

There is a significant improvement over the DGA deal on coverage of original Internet productions. Rather than budget being the only criteria -- any new Internet project is covered by the WGA as long as a professional writer is involved.

Separated rights and New Media writing minimums are very important issues to get, and neither are in the DGA deal. New Media minimums, however, are only for derivatives of MBA-covered programs. That's not ideal - but currently, those are the productions most in need of coverage, since they exist right now and are being deeply abused as "promotion." So, while New Media coverage isn't yet full, it is notable what is covered. And the separated rights gains are strong.

An unwritten favored nations "agreement" exists for New Media. This should be far-better. But the companies didn't even want this. So, it offers protections that might not otherwise exist. Certainly it can be abused -- but the ramifications would be counter-productive.

Again, there are problematic issues in the offer. But a very good case can be made for the full deal -- the many precedents alone being set are essential. And while holes exist, they at least seem like they can be policed more-fairly than holes in the past. Additionally, the improvements over the DGA deal are noteworthy. But without question, it requires vigilance.

Is it worth voting for?

Ultimately, this is the only question that matters.

For all the things I'd like to see improved, I think this is the best offer we'll get for many months - with no guarantees of worthwhile improvements. I wrote a Huffington piece last month that there are several critical signposts for the companies in February and predicted that's when they'd want to settle. That appears to be the case - and if February passes with no deal, so do those signposts. In which case, the companies have little need to settle. That means waiting perhaps three months or far more, as the AMPTP ignores the writers and waits for SAG - with no guarantee that there will be any gains. It's one thing to say we deserve more (and we do), it's another to look at that in perspective of reality. So, I think it's a flawed, but good contract with some impressive precedents, and well-worth accepting now.

Which raises the question of how did leadership do?

This is the question which colored everything written above.

Hours before the meeting, I was talking with a Guild member who viewed the negotiations as a failure, in large part because of issues not improved at all, like cable. I replied that cable wasn't what this strike was about. It was about establishing inroads for New Media to protect the Writers Guild's future. And they got inroads - some wonderful advances. Much essential good was established - things that were dead-on refused by the AMPTP from Day One. But now they're in the contract. And rollbacks dropped. This deal not only has successes, but profound ones.

He looked at me and said, "You're right."

(Oh, okay, he didn't. I made that up. We haven't had a chance to speak since. But I like to think he now feels differently...)

It's disappointing animation and reality were taken off the table. But that only means they weren't addressed in the contract, not that they won't be. The Guild is currently preparing actions for both. So, if they do get settled, that's all that matters, not where they got settled.

I think it was leadership's worst hour when they took DVDs off the table. They did it for the right reason - given assurances it would help get a deal - but they got snookered, and were wrong. It's impossible to think everything would go perfectly, and foolish for anyone to expect it. Horrible things happen in a strike, but what matters most is the end result.

No deal offer exists in a vacuum. It's one thing to say, "Why didn't we get...?!!" But the answer is simple - because the other side didn't want to give it. Just asking, just demanding, just pounding the streets doesn't get you what you want. When you are facing seven multi-national corporations determined to give you zero and toss in 39 rollbacks, you're lucky to come out alive. The WGA came out ahead. Not as far ahead as they wished, but farther ahead that many wags ever dreamed.

In a perfect world, this deal offer could have been better, but in a perfect world the AMPTP would have agreed to all this three months ago.

When asking how leadership did, it's not proper to look at the results alone. You have to look at the world it existed in. That reality surrounding it.

To be clear, I don't like the 17-day window. I don't like that there are no minimums for non-derivative MBA writing. I don't like that DVD was dropped, and other things in the deal. But I understand most of them.

The multi-national AMPTP corporations started by offering zero for everything New Media. They offered rollbacks. They insisted they would never give in on them, never ever give distributor's gross. They lied, they broke their word, they walked away from the table twice, they negotiated with others to get around us, they smeared our leadership. On and on and on. And they had billions upon billions of dollars to sustain themselves.

And despite all that, the WGA established a presence in New Media. It set guidelines for coverage in the Internet. It established some minimums. It got distributor's gross - distributor's freaking gross - for ad-supported streaming, and in some areas from Day One. It doubled the payments for downloading.

All against a crushing behemoth which insisted it would never do this, would never give in on New Media. Improving on a deal from another guild that should have set total pattern bargaining. And it did this in just over 3 months, for matters central to the Guild's survival, compared to 1988 when the WGA was on strike for 5-1/2 months over basically foreign residuals.

And it did this while facing other forces, as well. Notably being stabbed by the DGA which went around them to negotiate their own deal, massively-weakening the writers' position. All the while improving their own terms on the backs of the WGA's months of picketing.

And the WGA still got improvements, still established a presence in New Media, which was essential for its survival.

This contract isn't even close to perfect. This strike wasn't handled even close to perfectly. But then, neither is anything.

How did the leadership do? Consider the alternative.

Eighteen months ago, imagine a different Guild's leadership not interested in facing a strike and having no membership outreach programs. A year ago, they'd have no program to put together strike captains. For the past year, they wouldn't reach out to SAG leadership to develop a bond. There would be no weekly-meeting between the WGA's president and SAG's.

And then the AMPTP would have put on the table the same offer they did now - zero for the Internet and pages and pages of rollbacks.

The WGA's options would have been disastrous. They could have accepted the offer, destroying the Guild. Or they could call a strike - and being totally unprepared, which the AMPTP corporations would have known and waited them out, the strike would have collapsed like a flaming Valhalla, destroying the Guild.

The only remaining option would have been to not strike and keep negotiating - all the while the companies would have finished shooting this TV season, done pilots for next year, started to shoot episodes for next year, gotten all their movie scripts green-light ready and begun production on their entire movie schedule for next year - until the studios and networks finally had all the material they needed stockpiled, and then they'd have said, "This is our last offer. Zero for New Media and 39 rollbacks. Take it or leave it." Destroying the Guild.

No, this contract isn't Great. Yes, it has noteworthy flaws. But it has much good, some wonderful, and establishes critical precedents in New Media. And considering the alternative, it saves the Writers Guild.

I think the leadership of the WGA - for everything they've done in the full, wide perspective of reality dating back 1-1/2 years ago up to this contract - was remarkable.

I wish the contract was better. So what? I live in the reality-based world.

It's a world where this is the offer. It's a world where holding out just two weeks more will actually lead to three months more, at best, with no guarantee of improvement. And it's a world where so many were hurt. An offer like this with real gains could have been made before Day One, sparing those who deserved a fair contract, sparing innocent victims. But now, although the pain will linger, at last the city will be going back to work with a real foundation for the future.

In the end, for all the good and bad, there's one grand thing to come out of this. That's the image of John Ridley sitting at home, holding his head in his hands and crying out, "I ruined my reputation as a writer for the rest of my life over one month. I ruined my reputation as supposedly a sharp-eyed analyst over one month. One month!!! I will forever been seen as a short-sighted snake unable to even correctly analyze his own union and who tried to undercut others for his own selfish aggrandizement all for one month. What in the name of all that is holy was I thinking???!!!!"

That's enough for me. Just knowing that John Ridley will still be covered and protected by all the gains the Writers Guild made through its hard struggles, even though he stabbed all its members in the back, gives me warmth, as well. Because it shows what the essence of a union struggle is all about.