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The Honolulu Advertiser
Posted on: Thursday, July 12, 2007

Hollywood labor negotiations to focus on digital media payments

By Gary Gentile
Associated Press

LOS ANGELES — The Internet will provide the battlefield when studios begin negotiating Monday with film and TV writers in what could be the most contentious Hollywood contract talks in years.

The Writers Guild of America has said it wants a bigger slice of the revenue studios are seeing from distributing movies and TV shows online.

But studio executives said yesterday they were not willing to simply extend decades-old payment models to the rapidly changing new media arena.

Instead, they plan to press for a study re-examining the piecemeal way writers, actors and directors are paid every time a TV program or film is shown.

"It's not business as usual anymore," Barry Meyer, chairman and chief executive of Warner Bros., said at a rare pre-negotiations press conference by studio executives. Warner Bros. is owned by media conglomerate Time Warner Inc.

The guild contract expires Oct. 31. Other pacts with actors and directors expire next June.

"I think we're headed for about three strikes in a row" if the unions opt to negotiate payment schedules now rather than defer talks until a study is complete, said Nicholas Counter, chief negotiator for the studios.

The situation could affect the upcoming fall TV schedule and next year's blockbuster movies, even though studios have been stockpiling scripts in anticipation of a strike and some TV shows have accelerated production.

TV viewers could also start seeing more unscripted reality and game shows on the airwaves.

"CBS is not going to go blank," CBS Corp. President and CEO Leslie Moonves said.

Writers have already said a study is not necessary. They want a percentage of revenue each time a TV show or movie is sold on Apple Inc.'s iTunes store or streamed with advertising on a network's Web site.

"We feel a study results in more of our digital stuff getting out there and we're not getting compensated," chief guild negotiator John Bowman said. "It's crazy rhetoric. It pretends this isn't an enormously profitable place for them to be doing business."