DC Portfolio: Hollywood losses reach $1bn

Continuing with my portfolio, I approached the recent Writers' Guild of America strike action in a newspaper report style. Read below for my report...


DEVASTATING losses to the Alliance of Motion Picture and Television Producers from the Writers’ Guild of America strike have totalled $1billion, it has emerged.

NBC, one of the 397 companies represented by the AMPTP, announced the news on January 13, the same day as the Golden Globes were scheduled to be hosted.

The estimated losses include wages for cast and crew members of television productions, as well as hired services including caterers, prop and costume rental and beauticians.

The strike, which began on November 5, has delayed the production and transmission of popular series such as Prison Break and 24, as well as forcing famous presenters Jay Leno and David Letterman to continue their shows without writers, or pay the staff out of their own pockets.

However, it was not until the strike forced the cancellation of the Golden Globes - which had been hosted annually since the ceremony’s creation in 1944 - that the true power of the action was globally understood.

The impact on the Hollywood community has also been huge, driving many small businesses who depend on awards season income out of business, and leaving many restaurants and shops without paying customers.

The argument stems from the renegotiation of the Minimum Basic Agreement, a contract that is decided between the WGA and AMPTP every three years to secure writing services.

However, recent disputes have arisen regarding DVD revenue and the use of so-called “new media”, where television shows are now broadcast for a nominal fee or freely on the internet.

The WGA has proposed that writers receive 2.5% of distributor's gross for new-media sales and distribution.

But with most income now coming from sales of DVDs, writers are demanding a higher cut, as their current payment is based on a percentage rate decided when video tapes retailed for between $40-100 (£25-60).

Nick Counter, President of the AMPTP, said: “We are ready to meet at any time and remain committed to reaching a fair and reasonable deal that keeps the industry working, but the DVD issue is a roadblock to these negotiations.”

The WGA Negotiating Committee, who is in talks for a better deal with their employers, said: “Every issue that matters to writers, including Internet reuse, original writing for new media, DVDs, and jurisdiction, has been ignored. This is completely unacceptable.”

Famous picketers include Family Guy creator and actor Seth MacFarlane, British actor Hugh Laurie and comedian Robin Williams.

Democratic Presidential candidates Barack Obama and Hillary Clinton have also supported the cause.

Any increase on health, insurance or pension benefits by the WGA during the course of the negotiations will result in pattern bargaining, which means that many other unions will also benefit from a possible template agreement. Many believe that this threat is what is holding both sides back from making a permanent deal.