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Eric Bogosian – actor, playwright, screenwriter, and Writers Guild member for over 20 years — emails me (and permits me to make his message public) about six issues he hasn’t heard mentioned in all the talk about finances between the striking writers and the Big Media companies:
“1) In the spirit of ‘residuals’, the producers have never played fair. Contractually they short the writers (take a look at the international “buy-out”, which isn’t even being discussed in this negotiation) and then short the writers again by under-reporting income (again, especially internationally).
“2) In the new “Internet” age, for the first time, very exact accounting will be possible. Of course the advertisers will demand such exact accounting. Servers will be able to count the “hits” on any download very exactly. So potential residuals can potentially be calculated to the fraction of a dollar.
“3) In the new Internet age, the producers / studios / networks will be able to circumvent the international “middlemen” — national television stations and distributors in foreign territories. With the Internet they will be able to distribute directly to the local consumers. Furthermore, they will no longer need to distribute only to the largest markets (Germany, Italy, etc.) but will be able to distribute to every single person with internet access on the globe (Antarctica, for example).
“4) Ergo: Much greater profits (for example, a product like Coca Cola can advertise by being tacked onto an international distribution of say, the tv program Friends, or a download of American Gangster that goes directly to every person with a computer on the planet.) And Coke will be able to count every hit. Potentially, so could the WGA.
“5) Much greater profits and much greater exact accounting. Studio / networks want one and not the other. Understandably, since they haven’t been sharing in any real way in the first place (except with their insider partners, the star producers).
“6) This gives them a good reason to attempt to break the union(s). It’s not irrational. It’s just business.”
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Exact isn’t always exact. Systems can be manipulated by having ANYONE spam the d/l’s to up their so-called due. It’s only fair to factor in these types of manipulation for the purpose of residuals or setting ad rates. Things aren’t as cut and dry as they may seem.
Dream on. The same shills will (that’s really an old Carnie term, look it up) still be paid to do work that was never done… (The Government probably isn’t the only place they sell those $600.00 toilet seats.)
Count the back end all you want, the money has already disappeared before ink hits paper.
It’s getting really bad when huge Video Rental houses rent counterfeit disks, isn’t it? Who gets the payments then?
“Servers will be able to count the “hits” on any download very exactly.”
Yes, and no. While servers can count the “hits”, they can’t count how many people actually sit through an entire commercial, or immediately close an ad window. With the types of zealous fans I’ve see since the strike, I can see fans sitting around, clicking all day, just to up the hit count. Not to mention that it is probably very possible to create a program to do it automatically all day, 24/7.
“Exact isn’t always exact. Systems can be manipulated by having ANYONE spam the d/l’s to up their so-called due.”
You can count hits from unique IP addresses.
Sure, there can be some runup through use of proxy servers, people telling their friends to download it, yadda yadda… but, it’s not going to change anything by any significant percentage.
Good work, Eric B. You sure understand very well what’s going on… I hope the rest of the membership reads and understands what you’re written… D.
This is an interesting angle that I hadn’t thought of before, but should have. The internet really is a genie let out of a bottle, having far-reaching effects that I don’t think anyone anticipated in its early days.
Joel
Eric is correct.
In two cell phone entertainment deals I’ve done recently the mobile providers have a website that the content producer can log into to see his royalty/residual cut adding up in REAL TIME.
They do this because they do not fear transparency but rather see it as helpful to building their business.
The studios have built an industry based on screwing people (actors, director, writers and producers) over for the correct amount of compensation they are owed.
For reference on how the screwing really works I recommend you all to the book THE FEATURE FILM DISTRIBUTION DEAL by John W. Cones. It’s the best book on the subject.
Just because they can distribute internationally doesn’t mean they will. Look at iTunes. Some iTunes downloads aren’t available outside the states, even though they’re shows with an international following. Producers are used to distribution deals and they like them. Foreign networks with less original programming like distribution deals because they want to control when their viewers get the content. Net piracy and streaming makes all of this redundant, of course, but it’s going to take a while for some top execs to get that through their thick skulls.
The problem is that 4) is really a big, big question mark. The internet means tons of attractive options for advertisers that won’t enrich Hollywood. For instance, Coca Cola could advertise on Google or Facebook or what have you, which means price competition, which means that the kinds of deals Bogosoian talks about might not be particularly lucrative, because ‘Friends’ and ‘American Gangster’ are no longer the only ways to reach big audiences, and they have huge upfront costs to recoup, which Google (or whatever) doesn’t.
Not to mention that the huge and growing problem of internet piracy cuts deeply into the potential upside for the studios. Not to mention, a couple dozen other potential problems, which Bogosian elides with a simple ‘ergo.’
This is all true. That’s why the contract proposal specifies independent accounting audits for internet revenoue and participation in distributors, rather than producers gross. The companies don’t want either of these things, obviously, and that’s part of why this fight is so bitter and horrible. And why, as Eric Bogosian says, the companies want to break the unions. Without unions, big players might indeed be able to negotiate big contracts, but everyone else would be at the mercy of the companies. Walmart. That’s the model.
Love Bogosian’s work, but the “exact accounting” point just doesn’t hold water. In practice, the measurement of “downloads,” “hits,” “pageviews,” and other web-based success metrics make Nielsen ratings and studio accounting look like beacons of clarity and accuracy. That’s why even the WGA’s “tiered” proposal is subject to manipulation and the only surefire way to ensure meaningful participation for the writers is by according them a percentage of gross advertising revenue. Unfortunately, the prospect of the studios even considering such a formula will only occur in our wildest pipe dreams.
Eric makes some good points and especially when it comes to exact accounting but the trick of course is access to the metrics themselves. MySpace, for example, is owned by News Corp and I don’t see them allowing the WGA or any union to have access to the direct click-through or sell-through data so it would fall to a company or service such as Nielsen//NetRatings or TNS Media Intelligence.
Hits do not mean “ads watched.” It is just as fuzzy as TV advertising and any accounting formula will be just as fuzzy. If people think it is an exact calculation, they have never sat face to face with a media buyer at P&G.
This really isn’t true, though. As a Canadian, for example, I can’t watch shows streamed by American networks. Or even buy them via iTunes.
And all the Coca-Cola that the theatres sell, that make more money for the theatres than the movies themselves! Them over-priced soda cups! Unbelievable, don’t you agree?
Accounting – that’s an oxymoron, isn’t it, in and of itself these days?
I think the underlying accounting conundrum raised in all this is also the fact the when the numbers do end up being so very accurate, the media won’t be able to so precisely sell what they really want to sell, they won’t really be able to steer you to think a certain way, because the demographic studies of such precise Download and Broadcast Viewership numbers will evidently also let the whole world know exactly who is watching what and buying what, precisely where and at what income class – right?
That’s what’s scaring the manufacturers and advertisers – because the lies in advertising will go hand in hand with the exact figures that correspond to people’s interests according to what they’re watching and downloading! Which is sort of what is happening already, but if you transposed that to a political end, what do we have? –
that the numbers have been manipulated in order to make things appear better or worse, depending on who is willing to divide their share of the profits, no?
Dodgy, very dodgy indeed – Eric Bogosian has a point, but are we all really ready for such precision figures and accounting in everything we see?
Wow .. thanks Eric .. you have added the meat and potatoes, uh … err..the rice and beans … to the discussion of what this strike is really about .. and a perfect tool to use when explaining it to my fellow SAG members.
Who knew such a wild, creative brain could be so practical and clear.
while Eric Bogosian is an actor, playwright, and screenwriter, he is by no means an internet guru. First of all, there is no ‘new’ internet (age), there’s the old internet, the one we are all typing on right now.
Very exact accounting, not at all it’s the same accounting, there’s nothing new here that wasn’t on the internet before. We can create spreadsheets, databases, and counters, but they are only as accurate as the software allows and the data that is actually collected.
Circumvent the international middlemen? This too isn’t anything new, but in some countries there are laws that would have to be followed. The middlemen right now are the ones that distribute the work for them in other countries eg. on tv. They are still going to need these people unless they no longer distribute in medium other than the internet.
It looks like all of this is based on a very advanced internet. Unlimited bandwidth everywhere, everyone hooked up, super servers in place, and a whole host of things being done worldwide that is barely happening now. This story is yet another in a long line of “internet will take over all media distribution” stories. Sorry it’s a very long way off and there are a long list of technical and legal hurdles to jump over before it even comes close to reality. If ever.
Its very difficult and i think its a long process. Ok let me have some more information.
Eric has shared a lot of informative information with us that I never would think was going on. Thank you Eric