Just wanted to weigh in on a piece of interesting news that broke yesterday afternoon. As you may have read, ABC became the first studio yesterday to axe nearly thirty overall deals. Obviously, this is a horrible thing for the writers involved and their families; these people were effectively fired at a time when there are no other jobs to be found (and trust me– they don’t get severance packages). NOT FUN.
But, ironically, looking at the big picture, I think this is a really good thing. Here’s why…
Overall deals are massive deals studios make with writers and producers in order to have exclusive access to anything they write. It means a company says to a writer or producer, “we believe in you so much, we’re going to pay you X number of dollars, over X number of years, in exchange for owning anything you create.” Most overalls are $1-2 million per year and go to established writers with proven track records. Thus signing an overall deal is often the holy grail of TV writing. ABC, for instance, has (or had) deals with Gabe Sachs, who has written and produced for Just Shoot Me, What About Brian, and October Road; Larry Charles, who has written and produced for Seinfeld, Entourage, and Curb Your Enthusiasm (and directed the Borat movie); former NBC president Warren Littlefield, who’s produced Keen Eddie, Love, Inc., and Do Over; and Shaun Cassidy, who has written and produced for Invasion, The Mountain, and The Agency (you may remember him as Joe Hardy from the old Hardy Boys series).
Overalls last two or three years, meaning the studio agrees to pay the writer for those years, whether the writer produces anything successful or nt. So if Joe Writer signs a two-year, $3 million dollar overall with a TV studio, but writes absolutely nothing that gets on the air… the studio still pays him $3 million dollars.
The only way for a studio to terminate an overall deal is through the contract’s “force majeure” clause (French for “greater force”). In other words, a massive, unpredictable catastrophe that prevents the studio from being able to do normal business has to occur to allow the studio to fire someone under an overall. Maybe a tidal waves washes away the entire studio. Maybe California falls into the ocean. Or maybe a WGA writers strike shuts down the down.
That’s right… studios can use the writers strike to invoke force majeure and fire all (or some) of their overall deals. So ABC just fired almost thirty, including Gabe Sachs, Larry Charles, and actor Taye Diggs, who closed a producing deal after signing on last year to star in Private Practice. Warner Brothers is expected to jettison many overalls next week.
Many people believe studios have wanted a strike to use force majeure clauses to get rid of pricey overalls that haven’t produced quality material. Force majeure clauses usually can’t be invoked until five or six weeks into the strike, so– for studios wanting to ditch writers or producers under contract– they need the strike to last that long. (FYI– I don’t believe any studio ever wants a work stoppage. The amount of money they’ve lost is far greater than what they pay their overalls. But a “side benefit” of the strike, for studios, is certainly the ability to trim their fat and get rid of unproductive deals.)
But like I said, I think this is a very good sign. Here’s why…
It was announced earlier yesterday that the Directors Guild and the AMPTP, the organization representing the networks and studios refusing to pay writers, will begin official DGA contract negotiations today. In fact, they’re probably just finishing their donuts and coffee as I write this.
These contract negotiations concern many of the same issues that drove the Writers Guild to strike: namely, fair compensation for original online content and internet re-use of film and TV material.
Now, as you’ve probably heard, the DGA has a much less contentious relationship with the AMPTP than the WGA does. They also have a history of negotiating contracts many months before they expire (their current contract runs out June 30). And if they negotiate a contract that’s acceptable to both the Writers Guild and the Screen Actors Guild, which has been aggressive in supporting the striking writers, that contract could be seen as a template for the WGA and SAG contracts (SAG’s contract also expires June 30; the WGA contract ran out October 31).
Of course, the bad news is: the DGA has a history of negotiating contracts that aren’t very writer- or actor-friendly. This isn’t surprising; the DGA must tend to the needs of its own membership first, and those members have different needs than writers or actors. Still, a contract that’s good for directors (and assitant directors, who comprise 40% of the DGA) may not be the best contract for actors and writers.
But the good news is: the DGA has been very vocal about saying they intend to sign a deal that will be acceptable to everyone. Directors want the strike to end as much as anyone, and they realize that in order to go back to work, writers need a deal they can live with.
So several days ago, the DGA and the AMPTP began unofficial talks to discuss the issues at hand. And, just like the studios and the writers, they were so far apart on key issues (mainly, internet stuff– the big sticking point) that the DGA refused to commence official negotiations.
Yesterday, after days of further unofficial, backchannel negotiations, both sides announced they had made enough progress to begin negotiations immediately. In fact, DGA President Michael Apted said, “We would not enter negotiations with the AMPTP unless we were within
shouting distance of an agreement on our two most important issues:
jurisdiction for our members to work in new media and appropriate
compensation for the reuse of our work on the Internet and other new
So how does this all add up???…
Point #1: If DGA-AMPTP negotiations go well, and the resulting contract is acceptable to the actors and striking writers, it could end the strike. (Rumors swirling about Hollywood yesterday said the DGA could have their contract signed by tomorrow night. That may be pretty optimistic, but we’ll see…)
Point #2: Studio heads already have a pretty good idea of what the DGA contract will look like. Remember– the DGA doesn’t enter official negotiations until it feels it’s already pretty close to a deal.
Point #3: Once the strike is over, studios can no longer invoke force majeure clauses to get rid of expensive overalls they no longer want. Force majeure must be invoked during the strike.
Point #4: Studios could have invoked force majeure clauses a month ago… but they didn’t. Instead, most suspended their overalls without pay. Now, ABC suddenly announces massive firings, with Warner Brothers quick on its heels.
I think ABC Studios wants to scrap its unwanted overalls before the strike is over, and it feels/senses/hopes that the DGA negotiations will be quick and productive. They also have reason to feel/sense/hope that the DGA contract will be acceptable– or at least an acceptable starting place— for the WGA. Meaning (at least in the eyes of ABC Studios): they feel/sense/hope that the end of the strike could be in sight. I.e.: “better take out the garbage while you still can.”
Of course, as with all things in this strike, nothing is predictable, and the whole saga has had more twists and turns than Deathtrap.
But as we spend this weekend going to movies and watching football… and as the DGA and AMPTP sit around their conference table in their undisclosed location… and as ABC’s fired writers assuage their spouses and families… it’s worth asking… could the strike be coming to an end?
Next week will be interesting, for sure.
So keep your fingers crossed… and stay tuned…