Nov 27, 2007 (11:11 AM EST)
Hollywood Writers, Producers Strike Heats Up ... On The Web

Read the Original Article at InformationWeek

As negotiations resumed this week, Hollywood's writers and producers are increasingly turning to the Internet -- the platform in dispute -- to air their grievances.

Talk of a pending settlement continues to swirl between the Writers Guild of America and the Alliance of Motion Picture and Television Producers, even though both sides have agreed not to issue statements about negotiations.

Neither side is expected to speak formally to the issues until they can report significant progress or setbacks. However, viewers have ample opportunity to understand the points that negotiators are hammering out -- thanks to video sites and blog posts. Both sides have laid out their cases in online campaigns designed to increase public understanding and support.

The WGA is the most aggressive with blogs, and produced videos put out regular updates explaining its fight for residuals, the fees that creators receive when their product generates money. In a video explaining "What does the Internet have to do with you watching so many damned re-runs?" the WGA explains that musicians and novelists receive fees based on the number of times their products earn money.

In most cases, screenwriters earn a check for their screen and TV work. However, producers don't pay for streaming video on the Internet, even though the material generates ad revenue.

The guild wants to change that, and it wants to increase the residuals writers receive when movies and television shows repeat. The guild explains that more than 20 years ago, writers agreed to a reduction in residuals by 80% to .2%, or two cents on the dollar, in a move it says was to encourage the home video cassette market. They argue that when the Internet and television converge completely, they won't receive anything for re-runs. They want the residuals to go up .6% and to apply to streaming video, which means they would receive 4 cents for a $20 DVD sale.

The AMPTP also has turned the Web into a debate platform -- albeit with less fanfare -- to explain that writers receive residuals on permanent and pay-per-view downloads and that they had offered a residual rate for streaming shows, as well as a deal for exclusive writing rights for new media programs -- right before the WGA went on strike and ended negotiations.

The AMPTP also has argued that the producers cannot provide residuals for ad-supported streaming because the networks control the revenue, not the producers, and the WGA's contract is with the producers. The group also pointed out that it takes risks and pays writers, and increases its health care and pension contributions, regardless of whether a writer's shows do well.

They said that the market is undergoing major changes, which create challenges in terms of capturing revenue in light of fragmentation, increasing production costs.