As the Writers Guild of America strike against the Alliance of Motion Picture and Television Producers enters its second week, it certainly doesn't appear that a quick fix is in sight.
The main issue of the strike regards residual payments that writers receive from DVD's and other digital media. The writers claim these payments are based off an archaic formula that was instituted more than 20 years ago during the advent of VHS, and that they're entitled to more. The producers claim there's nothing wrong with the existing system. Said system pays writers residuals of 1.5% of the 20% the producers wholesale price, or 5 cents for every $19 DVD sold. The WGA is asking for 1.2% of 100% of the wholesale price, or 22 cents for every $19 DVD sold. It seems the only thing both sides can agree on, is that this is one issue neither side is budging on.
"The [networks and studios] said [Nov. 4], as long as the DVD residuals were still on the table, they wouldn't talk to us," said Eric Wallace, one of the WGA strike captains. "Forty-eight percent of writers [in the guild] are unemployed at any one time. How do you eat when you're not working? Residuals, buddy."
"We cannot move further as long as that issue remains on the table," said Nick Counter, president of AMPTP. "In short, the DVD issue is a complete roadblock to any further progress."
While the DVD issue has been the main focus of the strike, revenue from other digital media, like TV programming available on a network's website, is a big issue as well.
"I went to ABC.com to see an episode of 'Grey's Anatomy' and saw six commercials," Wallace said. "They're saying [Internet video] is just promotional, and it's not true. If we can't even get 8 cents [per DVD], that tells us they're just trying to bust the union. We'll be here as long as it takes."
Meanwhile, an executive from Fox actually thinks the strike will be a good thing for the company, in the short term.
News Corp. president and COO Peter Chernin recently said the strike would be fiscally beneficial to the company because it would cut out development costs.
"We save more money [not producing content] ... than we lose in potential advertisers," Chernin said.
He also stated that the strike would bolster Fox Sports programming, as well as the company's array of reality programming like American Idol and that much of the company's animation programming has been in the can for at least a year. Of course, a prolonged strike wouldn't benefit the company at all, though.
"I think there is a deal to be done, and I think it is particularly frustrating that we can't seem to get there," he said. "A strike longer than eight months would begin to negatively affect all aspects of Fox. I sure hope it doesn't go that long."