DGA, SAG and WGA Contracts Set to Expire

By Roger Paradiso

Negotiations are already heating up for the DGA, SAG and the AMPTP, due to run out June 30. WGA expires May 1. These promise to be vigorous negotiations that could lead to another industry-wide strike in June.

What’s at stake? Many of the same issues that were on the table three years ago ─ health plans, streaming, and Artificial Intelligence.

The health plans are all in trouble due to the current economic models of Trump and the Republicans. Health care costs have gone through the roof. So, the first volley has been made by the producers who leaked information to the press and public last October. One of the attorneys for the streamers said, “Insiders know one of the three guilds has only a six month reserve.” (deadline.com)

Deadline

The plans are “running huge deficits on a month-by-month basis,” a well-versed studio and streamer source tells us. The WGA plan has lost over $120 million since its strike ended two years ago. “It’s not sustainable, it has to be addressed,” the source adds. The producers will ask the guilds to consider trimming their health plans in terms of services and even eligibity.

Health and Pension Plan

The guilds have suffered with the economy, inflation, tariffs, and a lack of sufficient revenue due to tax cuts for the wealthy. With streaming raging in full force, we have seen movie theaters blow up and jobs lost ─ while large Marvel films make money as independent films die on the vine and filmmakers live in poverty.

What will happen with draconian cuts to health and pensions? This is a crucial life and death question given that the majority of members can’t even work enough to afford their health care and have woefully low pensions.

To fund these plans the streamers want draconian cuts and a five-year deal. To be fair, the pre-negotiating has just started, but we know from past discussions you gotta give to get ─ or do you?

Streaming Residuals

Streaming residuals have flipped the script on rank-and-file actors and stagehands. In the not-so-distant past, producers made movies and put them in theaters. Earnings were followed by Variety and producers’ forensic bean counters. You got paid by audiences who bought tickets and sat in a theater. The money flowed back to the studios, then to the guilds. Members got compensated not only for salaries but also in residuals. The producers and theaters made money from the audiences who saw the films and paid with cash. The cash flowed and could be traced.

Years ago, the producers adapted to television and cable and the system worked because it was all paid for with cash. Now the streamers make money from the subscribers who pay them with money. But the producers and the trades get paid by clicks and streams ─ bypassing forensic accounting of real money. How do you account for subscribers who bypass the old systems to join the streamers clubhouse? The producers joined the streamers yet still play the theaters who pay in cash. Yep, the producers have an alliance with streamers like Netflix. These new producers live in a cash and click streaming world with no real interest in theaters.

A few months ago, Pope Leo said, “The logic of algorithms tends to repeat what works, but art opens up what is possible.” He urged filmmakers to defend “slowness, silence and difference” when they serve the story.

In the beginning of the streaming war, the producers and artists hated the streamers. Now the producers are the streamers, and Netflix has joined the “movie business.”

Artificial Intelligence

The guilds thought they had roped this issue in the last deal. Not a chance. They got clicked and we got a synthetic actor. Meet “Tilly Norwood” the first significant synthetic actress who starred in Marvel movies and God knows what else. The guilds got clicked!

And then there was the Bartz v. Anthropic AI and the first seven million copyrights infringed in the AI era that we know about. The case was settled for $1.5 billion.

Expect copyright infringement to be a major battle in the negotiations. And welcome to the streamer vocabulary 101. Terms like “copyright infringement” and “informed consent and compensation” really mean “how to turn clicks into dollars.” Then there’s the “Tilly Tax” ─ which asks how much should we pay a real actor to compensate for the lost wages when Tilly takes over the role? And what do the trades do for compensation when they lose work to a synthetic workforce?

In the old days of Hollywood, the good guys always won. In the new days of a Lost Hollywood, the good unreal things may win.

The good news is that cinema will be underground. And like theater from the Greeks, it will survive ─ because we have learned from the masters in theater and films. Cinema will live on thanks to the independent filmmakers who survive.