The following letter, explaining the WGA's recent counter-proposal to the AMPTP, was emailed about 15 minutes ago...
To Our Fellow Members:
Yesterday, the WGAW and WGAE presented to the AMPTP a response to its proposal on streaming television programs.
We accepted the framework in their proposal of last Thursday for a fixed residual in the first year.
But rather than basing the residual for the entire first year on a small percentage of the applicable minimum, we proposed that the fixed residual be paid on a higher percentage of applicable minimum for each 100,000 streams per quarter.
This is a readily ascertainable number. In fact, the companies are already keeping records of streams for their advertisers. Both the advertisers and the companies are already using these numbers as the basis for their business model.
We believe these formulas will protect the writer even if all television reuse migrates to new media. This is our real goal – we simply want to make sure that writers keep up if reuse moves to the Internet. If new media reuse turns out to be additive, both partners will benefit.
After the first year, following the companies’ proposal, reuse is paid on a percentage formula. We held to our proposal that the appropriate rate for that payment is 2.5% of distributor’s gross and the same rate should also apply to streaming of theatrical motion pictures.
Finally, we modified our position to move closer to the companies on determining fair market value and ensuring our ability to obtain documents to enforce these revenue-based residual formulas.
Our fixed residual proposal is based on thorough analysis. To reach our formula, we looked at the value to writers under existing fixed television residuals and blended those residuals to the scale of new media. Our proposal protects the interests of both parties.
We look forward to the AMPTP’s response as we continue to pursue a discussion of all the issues important to writers.
We also recommend an article from today's Wall Street Journal entitled, "Cracks in Producers' United Front" found here. Thank you for your continuing involvement and resolve as this process moves forward. We are all in this together.
Patric M. Verrone