Hey all, I've been trying to follow the coverage on the Strike and have noticed that while there are many articles on the issue, many support the writers and oppose the producers. I've seen lots of rationalization regarding the writers' argument but little on those being presented by the producers. So, I thought I'd start up a little discussion here on the overall issue. Note, I neither support the writers nor the producers. Rather, I'm trying to show that the producers' reluctance is not entirely baseless or purely out of personal greed.

1. The writers often complain about the inconsistencies where producers claim that online distribution is an unproven format yet praise it to the investors. Firstly, I would like to point out that it is indeed a fact that online distribution has yet to produce a viable formula to generate revenue. Regarding what they are telling the investors, of course they are going to do that! How on Earth do writers expect producers be able to attract investors without pointing out the potential? It's not completely different from what writers do when approaching a producer with an idea. They point out the positives in order to sell the idea. The producers are doing the same.

2. Still on the topic of online distribution, many critics have argued that paying the writers by percentage of profits carry no risk since the expense is proportional to the earnings. However, this is not the case since the slice would be made from the rough profit. Meanwhile, the producers still have pay for bandwidth, labor fees, props, staffing, etc; many of which are at fixed prices that are irrespective of the amount of money being made.

3. Also, the producers need to present return to the investors comparable to the amount of money they are putting in in the first place. This is to validate the risk these people are taking. If it is too small, investors would back away. It's like gambling; would you risk losing $10 for a chance of gaining $11?

4. Regarding the commission hike on DVD sales, is it actually beneficial? Will the money actually go into the hands of the 'average writer' who earns little or would it actually just fill the already fat pockets of the industry's elite? Do the assisting writers who play smaller roles actually get residuals or just one-offs?

5. Still on DVDs, can the producers actually afford it? Even at four cents, if you take into account the total number of writers involved in a project (assuming all writers earn this commission), especially for DVDs on TV serials, this can add up to quite a huge sum. And this does not take into account production costs, transport and wastage (due to spoiled copies and/or copies unsold). Sure, the producers probably can afford to pay more, but is it to the extent as the writers are demanding?

Overall, I neither support the writers nor the producers. To me, both parties are equally greedy. Personally, I think the real victims of this strike are the manual laborers such as the production crew, carpenters, catering, etc. who earn a much smaller salary, work really hard and live on a day-to-day basis.

I just want it to end so that season 3 and Heroes Origins will start

But i dont support any of them either really, well i dont know, i agree with the writers in some ways but also i agree with the producers in another way

welcome to this edition of point, counter-point.

1) Attracting investors without knowing the precise amount of income is easy. Look at Amazon.com. The site operated for the better part of a decade as a net loss, yet investors kept pouring money in. Why? Because they knew, eventually, it would turn a profit. The same brain-dead obviousness can be applied to online distribution.

2) Also, for the producers to claim they get little to no money from online streaming atm is ludicrous. Or maybe i'm wrong. Maybe all the adds on the Heroes.com website for Nissan, Sprint, Cisco, Bee Movie and everything else are just hanging around there for free. Not to mention the 30 second ads for HP, Intel, Dell, Nissan, and the others that are played 8 times during a 1-hour streaming online episode.

3) Again, see Amazon.com. or eBay for that matter. Everyone knows online distribution is the future, and to say otherwise is like saying Apple and Steve Jobs won't make another good product.

4) Yes. and writers aren't actually all that rich...they need money from the good years to last thru the bad.

5) Yes they can. The explosion of the DVD market (mainly due to TV series being exported to the format) has made it all the more viable. Plus, the writers got screwed with their pants on when this issues first came up, because no one expected VHS to be a viable market (hence why they accepted the low, low, low offer)

1. There is a fallacy in your logic. You are making a general statement based on a singular event. Not every investor has the same dedication, confidence, patience and most importantly, money to wait it out like Amazon.com.

2. The problem is we don't know how much or even the format of how it is generated. Is it solely by the amount of traffic at the site? Or is it the amount of traffic the sponsors are receiving from the website? Or is it a fixed amount regardless of traffic? Also, just because they are making some money doesn't mean they are making a lot. As many webmasters can attest, the revenue being generated by a particular website isn't all that much and often barely enough to maintain the website.

3. Again, the same fallacy as in Point 1. Also, while online distribution is indeed the future, the question is how far away it is. One of the main problems is that online distribution requires high speed internet connections, which may not be widely (if at all) available in many countries. Hence, at least for the moment, only a small percentage of the internet's total population is actually able to utilize online distribution.

4. Actually, the cream of the crop often are relatively well off. And I feel it is this group of people who will ultimately see the bulk of the increased income. Hence, what this accomplishes is to further increase the disparity between the top and bottom rungs.

5. Not necessary, especially for serials. Looking at IMDb's page on Heroes, there are 10 named writers credited to it. Now, assuming all are being paid equally (and not proportional to the number of episodes they were involved in), a 4 cent increase mean that expenses go up by 40 cents per DVD. Still, that doesn't sound like much. But now, the writers aren't the only ones receiving commission. Once they get paid more, actors and directors will ask for more too. And there are seven directors and a whole load of recurring actors involved. Add that all together and it really starts to add up.

1) While yes, generally it is a fallacy to use a single example to explain a general circumstance, I should have been more clear in saying that its only one example of many (and its the one that the teacher used in my econ class a few years back =P ). There were many sites from the tech-boom...some were good (Amazon, eBay, FreshDirect, etc) and some were bad (PetChow.com). But this isn't the late 90's anymore, and investors don't have the same freeflow of resources (thats an oversimplification, but i don't want to bore you with the numbers). Suffice to say this is capitalism, and investors will try to be smart and put money on what will be profitable.

So I say again that it really won't be too difficult to attract investors. To say you can't attract them is to say that the market is not viable for future profit. If you think that, then i can't really argue with you because thats your opinion. But if you accept it as a viable future market, then you can use the example of eBay and Amazon to assure you that investors will invest, even if they lose money right now.

2) While your arguments about income given to most webmasters is logical, it doesn't quite apply here. The Heroes website is a prime example. There are so many interactive elements to the Heroes universe that are accessible thru the website...and even if there weren't, it still is the website for a major tv show that you have to go thru in order to stream an episode. While i don't know the exact figures for traffic on the website, i would hazzard a guess that it is fairly high. Meaning the revenue paid for those ads (I assume its a formula of a certain fixed cost plus click-thru hits) is fairly high. Same can be said for streaming shows at ABC.com. Yes, its a single page you go to, but notice that when you stream an episode, there is only ever /one/ advertiser...maybe you get different commercials, but its the same advertiser thru the whole thing. That sort of specialized attention comes at a cost.

3) Same as point 1, where if you deny it to be the future, then there is nothing really more to be said. If you see it as a viable market, that precedent shows that investors will invest, even at a net loss, for future potential revenues. Besides, Hollywood does a lot of shady accounting. My Big Fat Greek Wedding made $369 million worldwide, but its "net profit" was $287 million...for a movie that cost only $5 million to make. Under that same accounting, they claim that Forrest Gump only made a "net profit" of $60 million, which is complete bs.

4) If you look at a single writer for a show (and we'll say Heroes), lets say that it runs for 4 seasons. They get their salary for that show, plus whatever else. How long, realistically, do you think it will be till they are part of another hit tv show? Yes, they'll get work here and there, but they do rely on residuals as the gift that keeps giving. The same can be said for many, if not all, commercial actors.

And yes, the cream of the crop exists. No one is denying that Aaron Sorkin can write something and will find /someone/ to produce it. But not everyone has that name brand recognition. In short, a pay raise is a pay raise is a pay raise.

5) The fallout from a raise for the writers, and the other collaborators wanting more as well, is a legit concern, but perhaps not as expensive as you may think. After all, we are talking 4 cents here. And i would still argue that DVD sales are much more important these days than they were several years ago (thanks Family Guy...)

1. And another fallacy appears; that past indicate future trends. I apologize, I did Critical Thinking in A-Levels . I guess it is not impossible to find investors, but it would more difficult and less money in total.

2. While the total traffic to the website is high, you have to remember it's divided amongst all the other shows also available at the website. And when you're paying per writer/director/actor/etc per episode per show, that can add up to quite a lot.

3. Again, the key challenge that needs to be overcome is infrastructure. The enticement of net distribution is that it can quickly reach global markets. However, at the moment, the majority of the target consumers are unable to access the products due to the need of high speed internet connections. This, I think, is the main stumbling block as it would seriously reduce the total profits (even prior to the shady accounting).

4. Increasing the commission rates benefit the top tier of writers (who need the money less) a lot more than it does the regular writers (who need the money more) as well as significantly increases production costs. Hence, it is clearly not the best course of action. An alternative solution ought to be investigated. Maybe, writers attached to a particular company ought to receive a basic salary regardless of the amount of work they have contributed from which residuals are added onto. That way, writers would have a fixed income to rely on.

5. I disagree on the point since the producers and investors only take up a portion of the profits. A lot of it actually goes to the retails outlets we buy them from, agents and other middlemen involved in moving the product from the production company to the manufacturing company to the retail stores.

All in all, I think a lot of the drama and problems can actually be solved if the increased costs are added onto current DVD prices and letting the consumers absorb the financial burden. I mean, if the increased expense is as small as everyone is making it out to be, we won't feel it, right?

1) lol...well, critical thinking or no, its not a fallacy to use the past to predict future events. In fact, that sorta is the basis for making decisions in investment and, in most cases, business. Business models, surveys, trends...all that stuff is information about the past that is used to inform future decisions. So attracting investors to such a high profile and obvious area will be easy (i mean, come on, we all use the internet), and will continue to be so short of a law destroying net neutrality

2) And? so its split up. That still means there's money. Yes, its a question of how much, but thats the nature of profits.

3) This is true, it is a stumbling block, but one that can be overcome. But not all online content requires a hi speed connected - iTunes content sells like hot cakes. And the files are small enough that the connection doesnt have to be the best.

4) There's a big problem with the suggestion of a fixed income attached to writers for a company. The amounts of scripts given to studios is enormous. And when a studio for a movie or show buy a script, the writer does get a fixed amount. However, residuals are the way writers get compensated if their script becomes a hit, which is something the studios and the writers cannot predict.

5) Once again, thats the nature of capitalism and the workings of the industry. bemoan it if you want, but the producers and investors still do get a great deal of profit, despite the pay-outs to keep the machine running.

wow...that statement just sent chills up my spine. As consumers, there is a great deal that we absorb in increased cost that, quite frankly, we are simply unaware of. When we absorb it, it leads to greater profit for the makers of the product. And it only seems tiny because it is spread out among so many people. As an example, on a typical DVD you could buy at like, Circuit City that costs $18, the consumer already absorbs about $2-3 of a financial burden. Thats a little more than %10. It varies by product, but its typically true. Why do you think WalMart, for all its evilness, is so cheap? They've removed the burden from the consumer and put it back on the producer (the comapny that made it) and the re-seller (themselves).

1. Fair enough.

2. And there lies the issue. It's already not much since if you notice, they are largely from the same few sponsors. Hence, they aren't getting much each month since I can't see sponsors paying that high a premium. It's a question on affordability on their part.

3. The key difference here is that iTunes, aside from a select few countries, largely survives from music sales, where as what is trying to be accomplished here are sales of whole episodes and movies. The average mp3 is about 3MB while the average episode of Heroes is about 350MB, which is almost 120x larger than a song. And in the typical developing country with low internet speeds, it already takes about ten to fifteen minutes to download a single song. It would take them 20-30 hours to download a single episode. So, at least at present, internet distribution is probably not going to take off. At least not for another decade or so.

4. Then, that too is not the solution. However, there has to be an alternative, where producers are able to better support the newer, poorer writers without having to shell out huge chunks of cash to the top tier writers at the same time. Otherwise, the disparity between them is only going to increase and the toll on the producers will be high.

5. I disagree. Chances are, on the average DVD, I reckon that producers probably only make $5 (25%) of clean profit per DVD sold. If residuals increase, even by 4 cents, that's about an increase of $1.40 (7 directors, 10 writers, 18 main/recurring actors) using Heroes as a benchmark. That's a 28% loss in profits! Even if you round it down to 25%, that's still a very large chunk. Put it this way, if your boss one day came up and told you he's taking a quarter of your pay with no reduction in work load or compensation, you'd raise a ruckus too, right?

All in all, I remember some people pointing out that one of the reasons writers are demanding higher residuals is because they feel they are getting underpaid due to Hollywood's shady accounting. This, in my opinion is completely stupid. The problem is not that the writers are getting too low a pay but corruption! Hence, they should not be demanding more money but trying to pressure the government to keep closer tabs on the account books. Otherwise, all that is going to happen is that the accounting will simply become shadier with no real benefit to the writers (with the possible exception for showrunners).

well i am an electrician by trade. but i carry out a lot of installation designs as part of the company i work for (it makes my life easier as i dont have to follow someone elses bad design).

i design, and install an electrical system in a household, just as a writer would write an episode of heroes or lost, i get paid by the hour and usually earn less money than i work for as thats the way a lot of large firms work these days. the thing is, i dont think my boss would entertain it if i asked for even 0.1% of each house that was sold with my electrical system in it. say my company charges £5000 to design/install a system, and i get a flat rate of £200 per house (i wish) that means i get an extra £5 per house for 0.1%. now if i do 5 houses a week then thats £1000 flat rate and £25 extra per week. now take into account that there may be 3 electricians on the project, thats £3075 of the cost already, thats before splitting the cost to the official works and other overheads.

so the company is losing £75 of the profit for me asking for a little more money. what happens when a system i design fails/doesnt meet standards. i still get paid. just like the writers do for writing a flop (the beginning of season 2 lol) the writers dont have it so bad. but for a flop, the overall team loses out (money, time, effort all wasted)

i think its fine for an industry to have unions/guilds etc... but they should focus on flat payment rates of the members rather than internet/dvd sales. at the end of the day, a good story doesnt sell dvd/online content, good advertisement does. and dont forget that good production, acting, directing, and story all sell these programmes. so the writers are being greedy, as there isnt just them keeping the industry afloat.

There's a very simple difference that this kind of argument ignores, and it's that when a studio buys a script, they buy it for a flat rate that is pretty tiny. Let's say the writer only sells this script all year.

The studio had to pay a tiny amount, becasue they have no way of knowing if this script is going to be valuable to them or if it'll never get off the ground. They can't afford to pay a fortune for every single script, so they don't.

Now let's say that the script goes on to be the next Star Wars. It's HUGE. EVERYONE's making money!

Except...

If you take the residuals from the writer, that means all they got paid was this tiny paltry sum. And even though everything that the movie is stemmed from THEIR idea, they only got paid a few hundred dollars from it. They still need to go on working in another job, and watch while everyone else makes insane money.

The fact is, without residuals, both actors and writers would make next to nothing. Do you REALLY think that so many extremely intelligent and well educated people would dedicate their life to writing if they could only make a couple of hundred from it? If *I* was as smart as say, for example, Joss Whedon, and writing offered so little, *I* wouldn't be a writer! I'd be doing something myself and my family could survive on!

The sort of flop you're talking about is a completely different thing, as almost no one in the Writer's Guild writes for a show like Heroes. Most of them are like the writers of tiny indie movies or maybe a single episode of a TV show who barely get anything. Most don't have a regular employer who will go on paying them even if they don't produce something that makes a lot of money. A huge percentage of writers do not have regular employment, and they need residuals to plug the gaps.

This isn't about greed, there is nothing greedy about making enough money to survive. Writers are safeguarding their FUTURE. Someone pointed out that online content might not start making money for ten years (personally I think they're already making a LOT of money, but I won't get into that since there's no way to prove it either way). Well, sure, it might not, but if the Writers are locked into a contract for fifty, then in ten years they'll stop making money and it'll be forty more before they next make any.

And also, as to sympathizing with the other workers in Hollywood, well, the Writer's Guild is considered the deal breaker of the industry; their contract renewal comes up first and they set the industry precedent. The reason actors and teamsters and other people are refusing to cross the picket line is because if the writers get a fair deal then the chances of THEM getting a fair deal significantly increase. There is a huge degree of support for Writers within the industry, and that's because EVERYONE stands to benefit if the writers succeed.

So much of the "Writers are greedy" argument falls down under scrutiny when regarding DVDs anyway, as the Writers took all mention of changing DVD residuals off the table during original talks, and the producers STILL weren't interested... so there was hardly any writerly greed involved there...

sorry i was a little one sided in my post i guess, and saying the writers wer ebeing greedy wasn't an overall view of them, just regarding wanting money from the dvd sales. as thats part of the producing companies work really. a lot of shows dont come to dvd so what would the point of the deal be for those.

although i do take onboard everything you said and its a fair arguement. at the end of the day id rather see the writers prevail as i think larger companies in the industry make way too much money off little peoples hard work, which will never change, but the little people should be shown more appreciation for the hard work they do.

But if you think about it, the same argument can be said for the various crews in that their work forms an integral part of the finished product, without which the show wouldn't work yet they don't get residuals either. This can be especially seen in action movies where visual effects artists, choreographers and stunt crews are probably the main attractions, arguably more so than the actors and/or plots themselves.

Ultimately, the argument isn't so much whether writers ought to receive residuals but rather how much and whether it is feasible. For instance, a writer who has only seen one of his/her works come to fruition really shouldn't be able to live off of that alone, especially if it is for television. It's all a time:money ratio. If you include residuals, writers are comparatively well paid given the amount of time they invested into the idea in the first place. A writer who has only had one script used really shouldn't be able to support himself on that alone.

But they rarely can! The residuals are tiny, usually only a few pence. And if you believe they SHOULD have residuals then I don't see why you're against the strike- the strike is really only over internet material, which they don't get residuals for. They had completely stopped asking for DVD residuals to increase when negotiations broke down- they've just brought them back in because apparently they're not the sticking point.

I agree that the writers should get residuals but I also think that 4 cents per writer per DVD is about all the producers can afford right now given the prices of DVDs.

As for internet content, I actually agree with the producers in that it is indeed far too early to decide at this point. As mentioned before, the key 'selling point' of internet content is global audience. Yet, the majority of the world's population doesn't have the internet speeds to make downloading whole episodes and/or movies feasible (for them).

Also, there's the question of how much the producers are actually making from internet content versus the financial burden they are undertaking to do so. Face it, no matter how you calculate it, production companies are generating less revenue due to less advertising while having to pay for more services, such as bandwidth, storage space and a web team to maintain the site.

Also, internet residuals only help the industry's elite in that most writers don't have material being used by the big companies, of whom would be the only ones able to provide internet content should they have to start paying writers, actors, directors, etc. on top of the other expenses.

On top of that, paying them for internet content would mark a sharp decrease if not the end to viral marketing and companies would be forced to remove their content from places such as Youtube and Veoh. Hence, there would be less advertising of the movies and series, thus less buzz generated. This could then have a severely detrimental effect on both, the producers and writers as fewer people would be drawn in to watch the movies/series in question, thus reducing profits for all parties.