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SHIFT: The technology driving the Hollywood writer's strike

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Attention all television addicts: Prepare for some serious withdrawal, and a healthy dose of reality. Reality TV, that is. The East and West Coast divisions of the Writers Guild of America (WGA) are on strike against the Alliance of Motion Picture & Television Producers over conflicts regarding DVD residuals and new media. You may have notice that there are a bunch of places to get TV shows and movies these days, and as they've been developed the writers have been sitting by, watching the studios and producers get rich off of their work. You're probably asking yourself, why should I care? Keep on reading.

The DVDeal
According to the writers, they got ripped off when cable hit it big, and they got ripped off again with VHS. They won't be fooled again. For starters, they want a bigger piece of the still-big DVD pie. The contract covers new disc technology, such as Blu-ray and HD DVD, as well as anything new coming down the line, so it's in the writers' best interests to get this settled now. The exact definition of what's up for debate is a disc, cassette, cartridge and/or other device serving a similar function which is sold or rented for play on a home-type television screen. Their old contract gave writers about 4¢ per DVD, and they want to double that to 8¢.

In addition to the overwhelming success of movies on disc, they couldn't have been prepared for another new trend. Have you seen the shelves at Blockbuster recently? A significant section is devoted to television shows. With the holiday season approaching, TV box sets are sure to be bestsellers. At the moment, the DVD issue is bouncing on and off the negotiation table as the writers realize that the Internet poses a bigger issue. Wisely, they might be willing to concede the DVD discussion with an eye on the Internet.

New Media Madness
DVD is the present, and the past. But writers are most concerned about the future, and rightly so. As the Internet pipeline becomes more efficient, the quality of what's online will improve hugely. Look at how much more information is available since dial-up took a dive. More and more people are viewing TV shows on everything except TVs. Currently, 70% of Web users in the U.S. stream video. That works out to 126 million people in this country streaming more than 7 billion online videos.

The WGA wants to be on board as television takes the broad leap out of itself. Computers, cell phones and portable players are all becoming viable and popular "televisions." What does this have to do with writers? According to them, a lot. Their pay was based on the initial on-air television broadcast. These days, more and more shows are purchased for viewing. For example, some SCI FI shows can be downloaded, for a small fee, from iTunes, although this agreement will end in December. Shows from all 3 of the major networks can be viewed online, with limited commercials, for free. Don't think the studios aren't making money from this, although they claim that this is more for "promotional purposes," and not for profit. iTunes charges $1.99 for TV episodes, and ABC's shows have paid commercials.

Currently, writers get a share of the 1.2% of the licensing fee given to production companies for what is called "electronic sell-through revenue." As new delivery methods develop, writers want to ensure they're covered. Products such as Vudu are poised to download HD movies as they become available from the studios, in addition to their current collection of over 5,000 movie titles. Vudu downloads and stores movies on a storage system that can hold 100 purchased movies, and unlimited rentals, unattached to a computer, to watch on your TV. Movielink, a small company that offered movies and television programs for download to your computer was recently purchased by Blockbuster. Netflix is already streaming movie previews, and you can bet that the next step will be complete movie downloads.

Whatever technology comes along, if the studios get paid (and you can be guaranteed they'll make sure they get paid), the writers want to make sure they receive a reasonable percentage. If a show is being viewed on a portable player like the iPod Touch, writers argue they should get paid the same as if it was viewed in that person's living room. In fact, they might argue that if it's stored on a device that provides multiple viewing, writers should make more than if it was a one-time viewing.

The Bottom Line
For many of us, this is an issue that hits close to home. As a writer, I have more than a casual interest in this (I should point out that my paycheck for writing this comes from NBC Universal). If I agreed to be paid for writing for a website, and someone else was paid to put my work in a magazined, I would be pissed. Anyone who owns any intellectual property should pay attention. When you agree to the price for a piece of work, you need to make sure that you're covered for any future uses, real or projected. People who wrote books 30 years ago couldn't have predicted the popularity of audio books. Filmmakers who weren't prepared for home video, laserdisc or DVD may have lost the right to claim huge profits now. Ownership involving specific current technologies must be covered in a contract, and the contract must also define ownership involving future technologies, including ones that have not yet been invented. Get a lawyer — every word is important.

The Final Scene
The effects of the strike have already hit home. Late-night talk was the first victim, and Hollywood is scrambling to get more (unscripted) reality shows lined up to fill the void once the scripted stockpile runs out. The question is, will Hollywood agree to share slices of all the new technological pies, the size of which they've done a decent job of hiding in the first place? The terms agreed to in this new contract will be some of the most important words the writers have ever written.

An audio engineer based in Atlanta, Leslie Shapiro has been covering consumer electronics for almost a decade. Her work has appeared in many publications, including Sound & Vision, Crutchfield Advisor, and How Stuff Works as well as AOL. A longtime consultant and legal advisor for the electronics industry, she has a penchant for Bianchi and Colnago Italian bikes, and her favorite word is "synchronicity."

 
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