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Actors pretty, smart on DVD
June 5, 2008
Who says actors are dumb?
The Hollywood union that’s fairest of face is also the one that’s holding out the longest in negotiations with movie and TV producers on the issue of what its members get paid when their work goes to DVD. At roughly $23 billion in U.S. consumer spending and $40 billion-plus worldwide, DVD is, of course, the single largest revenue stream for the studios.
Neither the auteurs over at the Directors Guild, nor the brainy Writers fought very long or hard for a raise in DVD residuals. Instead, they went right for their cut of revenue from digital distribution and other forms of new media, which are likely to total a few months of DVD revenue during the duration of the new three-year contracts.
To be fair, the studios told the writers and directors that there’s no money in new media for the foreseeable future, but the helmers and scribes saw right through that. All the media congloms tout the potential of new media to Wall Street (40 million TV episodes downloaded on iTunes!), so there must be money there, right?
Who’s zoomin’ who?
The producers are reportedly immovable on the issue of DVD, hewing steadfastly to the position that DVD revenue is in most cases what makes profitable films profitable, so perhaps it was smart negotiating for the unions to concede shiny discs and move on. SAG has already shown its willingness to compromise, stepping back from its early request for a 50% raise in DVD pay. Now it’s seeking the equivalent of a 15% raise in a complex maneuver that involves pension and health benefits being paid on top of their traditional DVD residual allocations rather than out of the DVD residuals.
I know a lot more about the economics of DVD than I do about negotiating labor contracts, which is absolutely nothing. So maybe the actors should give up on DVD.
They didn’t get an increase in their last contract, back in early 2005, and that’s when DVD was still growing—by 8.5% in 2004, vs. a 3% decline in 2007. As it has become clear that, even with Blu-ray, packaged home media may be flat to slightly down for this year and beyond, the producers have got to be more determined than ever to hold on to every penny.
At least the actors are showing that they understand where Hollywood really makes its money. DVD may be flat at $20 billion-plus, but it’s going to be a long time before digital revenue approaches that lofty plateau.
Posted by Marcy Magiera on June 5, 2008 | Comments (0)
