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Media firms, Hollywood screenwriters reach accord to avert costly strike

LiveMint logoLiveMint 02-05-2017 Anousha Sakoui

Los Angeles: Hollywood screenwriters and some of the world’s largest media companies reached a tentative labour agreement, averting a strike that could have cost them billions of dollars and halted production of popular TV shows and movies.

“We have reached a tentative agreement,” the Writers Guild of America said 2 May in an emailed statement. Alliance of Motion Picture & Television Producers Spokesman Jarryd Gonzales confirmed the agreement in an email.

The Writers Guild has been seeking higher pay from the alliance, the bargaining unit for companies including CBS Corp. and Walt Disney Co. The screenwriters say they are making less money even as TV production soars to new highs.

Writers won a 15% increase in residuals for pay TV and $15 million in increases for payments related to high-budget content and for comedy-variety writers in pay TV, according to the Writers Guild statement. The writers had authorized a strike in a vote last month. The deal also covers “contribution increases to the Writers Guild health plan that should ensure its solvency for years to come,” the Writers Guild 2017 negotiating committee said in the statement.

The previous writers’ strike, which lasted for 100 days, cost the entertainment industry some $2 billion, according to the Milken Institute. It also affected a wide rage of businesses, from restaurants to tailors, which rely on production for business.

Writers and media companies were haggling over how to compensate the people who create popular entertainment properties, and fund a health-care plan that has been losing money.

The TV industry produced a record 455 scripted shows last year, more than double the number of programs made in 2009, according to FX, a cable outlet owned by 21st Century Fox Inc.

Yet writers say they earn less per show because the business model for TV has changed. In the past, broadcast networks used to account for most of the scripted shows on TV and produced 20 or more episodes a year. Today, many new shows are made for cable or streaming services and have fewer episodes per season, meaning less for writers. They also earn less in residual fees for shorter series.

Compensation for writer-producers dropped by 8% to 26% over the past couple years, while showrunners have also seen their incomes decline, the writers’ say. Bloomberg

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