January 3rd, 2008
Striking writers and digital media
The members of the Writer’s Guild of America (WGA), a union that consists of most of the writers responsible for TV and movie content produced by the LA-based movie industry (a position defended by the fact that union contracts require most sets to use only union writers), continues unabated, thus putting a large crimp in American ability to entertain themselves while seated on couches drinking sodas and scarfing junk food. Okay, that’s a bit of an exaggeration, as we still have 100 years of media content that can be watched, and reality TV is mostly unaffected by the work stoppage.
It has, however, put a stop to new content produced by late-night talk shows. Though David Letterman’s production company, World Wide Pants, managed to negotiate a side deal with the WGA, NBC-based talk shows (Leno, Conan) or shows owned by Viacom (which include Jon Stewart’s “The Daily Show” and its evil twin, “The Colbert Report,” which constitutes a video “crack” that I have greatly missed these past months) didn’t, thus creating a wedge that the WGA hopes to use to encourage other studios to negotiate deals more to the WGA’s liking.
Personally, I’m of two minds with respect to the WGA. On the one hand, I’m well aware that LA is overrun with hordes of wannabe participants in the movie industry. A poignant anecdote was a guy I ran across passed out at a bar who I tried to help home by paying for a taxi, only to discover that he didn’t, in fact, have a home and lived (literally) under a bridge. He was, he explained, a writer, and he planned to make it big Real Soon Now.
The fear, in other words, is that all that competition would make writing for TV and film an essentially free service.
Likewise, I am sympathetic to the WGA’s key demand, which is that they should get a cut (2.5%) of revenue derived from online digital media distribution. Digital media is clearly an important component of future sales, and I should think it makes no business sense for writer’s to lock themselves for the next several decades into a contract where they derive no revenue from the fastest growing segment of the content business.
On the other hand, cream does rise to the top, and I fail to see why WGA members should get treated better than, say, book writers, who tend to be freelance and have to negotiate rates on an ad-hoc basis. Unions can also have a stifling effect on business productivity. Unionized labor hasn’t done America’s auto industry any favors, and it’s hard to ignore that unions have made media production in Los Angeles an insanely expensive endeavor. When boom operators, the human equivalent of microphone stands, can make over $100,000 / year and union contracts actively ban technologies that might reduce the need for such humans, you know you are getting into very silly territory. (NOTE: Since my intent wasn’t to pick on boom operators, whose jobs are truly hard, I’ve excised the previous line. It isn’t relevant to the point I’m making. I can’t remove it entirely, though, as the Talkbacks wouldn’t make any sense anymore).
But that rather long preamble wasn’t the reason I wrote this blog. Rather, an opinion piece by Thom Taylor in the LA Times got me thinking about the fallout from an extended strike. Taylor notes that the 1988 strike resulted in new business models as idle writers with nothing to lose started thinking of new ways to make money. This could, according to Taylor, have the effect to cutting producers even more out of the revenue pie of the future. Quoting from the article:
During the 1988 strike, writers worked independently on “spec scripts” (written on the speculation that they would eventually sell them) and a pipeline-dry studio system snapped them up. TV producers also sought alternatives to traditional, high-cost scripted series. The strike resulted in the 1990s’ spec script boom and reality television — two new business models.
It’s not strikers’ demands but the work stoppage itself that creates a new paradigm. By fighting the writers over the new-media issues today, the studios are effectively creating what they fear most: a major tectonic shift in the entertainment business that will reduce the role of the studios even further.
That tectonic shift, as it turns out, is the core of the dispute between producers and writers, as it pertains to revenue derived from content distributed direct to consumers through web sites. Such content can give writers greater levels of creative control along with a 50% cut of revenue. FunnyOrDie, a website co-created by Will Ferrell, was responsible for the Internet hit “The Landlord.” If you haven’t seen it yet, go see it now.
Such sites aren’t going to compete from a revenue standpoint with Mr. Ferrell’s take-home pay from a major movie, at least not yet. The problem, of course, is that Internet Video must for the most part be viewed through a PC, as opposed to the largest viewing surface in the home: the TV set. Though PC viewing is growing more common, I don’t think it will ever replace a demand to see media through a TV set. My sofa is a heck of a lot more comfortable than my office chair.
That’s why the rush is on to find a way to bridge the Internet and TV viewing world. Internet content streamed to a TV set is the next horizon in media distribution, and the company that gets it right is likely to make huge stacks of cash for its efforts.
The day that a TV viewer can tap FunnyOrDie using a TV remote control from the comfort of their living room is the day Internet content starts to compete from a revenue standpoint with traditional media company-generated content. Oddly enough, the WGA strike may just hasten the shift, winning producers a smaller part of the revenue pie even as it undermines the union whose strike drove more writers to experiment with the tools of the digital age, because let’s face it: If good writers can get their content directly to consumers through web sites they control, they don’t need to trouble themselves with vehicles for pooled negotiation.
The strike blade cuts both ways, in other words.
John Carroll has delivered his opinion on ZDNet since the last millennium. Since May 2008, he is no longer a Microsoft employee. He is currently working at a unified messaging-related startup. See his full profile and disclosure of his industry affiliations.
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| 01/03/08
