Writers Want Compensation to Reflect Content Success, Studios Push Back
By Movieguide® Contributor
Writers have been on strike, in part, to fight for how they are compensated for the work they create for streaming services, but studios continue to reject their proposals.
SAG-AFTRA National Executive Director Duncan Crabtree-Ireland reported to Deadline, “The question is: Are you or are you not willing to share some of the revenue you generate from actors, and also from writers, directors and crew, with them or not? The answer needs to be yes. It is not okay anymore for companies to just bring in huge amounts of revenue from people’s work and not share it with them.”
Even though writers and actors receive fixed residuals for their work for streaming services, these residuals do not reflect the content’s success.
Deadline reported, “the WGA suggested a ‘viewership-based’ residual model, in addition to the fixed residual already in place. That was rejected, according to the union. SAG-AFTRA took that suggestion one step further, proposing that performers receive a 2% share of the revenue generated from streaming content. That proposal was also flat-out rejected, according to the guild.”
Crabtree-Ireland added, “We had this proposal on the table on day one of negotiations on June 7. To this very day, throughout that entire 35 days of bargaining and even since, the companies have never come back to us with any substantive response. Their answer was, ‘We aren’t interested in talking about it.’ So it’s going to be very hard to reach an agreement on something when the companies won’t even discuss it with you.”
Currently, streaming services do not share their viewership data. In fact, Netflix is the only streaming service that consistently reports viewership data, though the streaming service doesn’t provide full data transparency.
“Data transparency is related to power. This is a fight about power. Because right now, the streamers have power, and they don’t want to give it up. They have the data about how valuable things are, and they’re exploiting it by not paying the creators as much as they’re worth for seasons two and three and four, because creators don’t know how much the show’s worth, because they don’t have the data,” David Offenberg, an associate professor of entertainment finance at Loyola Marymount University, explained.
“SAG-AFTRA has suggested using Parrot Analytics’ content valuation tool to determine the revenue generated by each piece of streaming content,” Deadline reported.
“The guild proposed that each quarter, producers would pay 2% of the quarterly ‘Revenue Contribution’ for each series or film, and this would be divided pro rata among the principal cast ‘based on time and salary units or ratable distribution,’ on top of the existing Streaming Revenue Sharing payment,” Deadline continued.
Parrot Analytics uses metrics like social media engagement and Google searches “to understand the impact of a piece of content on a studio’s revenue. It uses quarterly earnings data as well as subscriptions and ad revenue to estimate that impact for each series or film on a platform.”
Crabtree-Ireland said the guild thought this approach “reflected a more broad-based and objective approach to evaluating that without the kind of insight data that the companies have been unwilling to share so far.”
However, Andrew Rosen, a former Viacom executive and the founder of streaming newsletter PARQOR, said, “The challenge with the data is I don’t know which story you want to be told…Do you want to know that you didn’t make a difference, that the algorithm was the difference maker? If actors are open to being quantified for how they help with engagement and churn, if that’s true at all, that’s the conversation to have.”
Crabtree-Ireland responded, “What this is really about is recognizing how streaming has become such a central part of the platform for our members’ work, and these streaming platforms have been built on our members’ voices. The fact is, there’s not a percentage of that revenue that the streaming platforms are gaining that is shared with us or with directors or writers or any other creatives in that form.”
“We’re not wedded to that aspect of the proposal. We’re wedded to the concept of—you’re bringing in a bunch of money [and] our members are the reason why it’s coming in and they ought to have at least a tiny little piece of that pie shared with them,” he concluded.
Movieguide® previously reported on the strike:
Variety reported a source who said, “There was just this sadness. We were completely out of the politics and just invested in the work. Now, a lot of people are going to lose their livelihoods, won’t be able to keep up home payments, school payments.”
On the set of GLADIATOR 2 actors such as Denzel Washington and Pedro Pascal began to book flights back home. They left behind a high-budgeted film and a 400 employed crew for the film.
Michael Greene, who is a member of SAG-AFTRA’s negotiating committee said, “It comes down to commerce versus art. What’s happening right now is the commerce doesn’t really understand how the artist thinks. They think they can do this without the artist, or they can do it with AI. They’re thinking in numbers. Commerce wants to win out for their bottom line, and they’ll never fully win without the artist. It’s David versus Goliath.”
Brent Lang of Variety reported, Disney CEO Bob Iger countered with his own let-them-eat-cake sound bite, telling CNBC’s David Faber a few hours earlier that when it came to negotiating with striking writers and actors, “there’s a level of expectation that they have that is just not realistic.”
Matthew Harrigan, an analyst with Benchmark stated, “I’m in the pessimist camp. I think this will be at least several months. Both sides seem dug in. It all comes down to who has the financial wherewithal to hold out the longest.”
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