Originally Posted By DVC_dad I was reading a few feeds and came across this: How interesting. <<<In his keynote speech on Wednesday morning at the Media and Money conference hosted by Dow Jones and Nielsen, former Disney CEO Michael Eisner talked ...>>> It seems that Eisner really really doesn't like Steve Jobbs at all. I wonder why. <a href="http://tinyurl.com/295432" target="_blank">http://tinyurl.com/295432</a> I especially liked this... <<<But Eisner acknowledged that the studios and networks aren't entirely faultless. Their problem, he said, is hyping up digital platforms as being more profitable than they actually are. "It's a double-edged sword. The studios deserve what they're getting, because they've been announcing how great (the Internet) is. But then they open their books." Eisner, a well-known critic of Apple (whose CEO, Steve Jobs, is a powerful member of Disney's board of directors), suggested that the profits may be getting sucked up elsewhere. The studios "make deals with Steve Jobs, who takes them to the cleaners. They make all these kinds of things, and who's making money? Apple! They should get a piece of Apple. If I was a union, I'd be striking up wherever he is." >>> What do you guys make of this? Is there really and truly very little profit out there from internet based viewing of media? Is that even the issue of the strike?
Originally Posted By DVC_dad <a href="http://tinyurl.com/2vuatv" target="_blank">http://tinyurl.com/2vuatv</a> another interesting bit about the strike and how Einser thinks its a terrible idea.
Originally Posted By Sport Goofy << Is there really and truly very little profit out there from internet based viewing of media? Is that even the issue of the strike? >> Profits aren't all that great in the online media world. There just aren't enough eyeballs out there to generate big ad revenue, and you also have the likes of Google that is sucking away a lot of the traditional ad revenue streams that old media companies would like to employ in the new media world. The strike is a lot about new media vs. old media. Writer's sense a huge shift towards digital media and want a piece of the action. The problem is that the studios don't necessarily have a piece of that action to give away. There are a lot of other entrants into the online world like Google, Tivo, and Apple who are siphoning off revenue streams that would normally be 100% in the ballpark of the broadcasters and content producers. That seems to be the thrust of the conflict -- writer's want to make a direct comparison of old media revenue streams to new media revenue streams. Neiter side on this issue has a really good grasp on how to best exploit new media and in the long run, they'll probably both lose.
Originally Posted By Jim in Merced CA I've always thought that Eisner is a smart man. And in this case, I would agree with him regarding the strike.
Originally Posted By ni_teach Is there really and truly very little profit out there from internet based viewing of media? It depends on how you look at it. Itunes has had billions of downloads and I saw a report that Disney did 1.3m in downloads this year. <a href="http://www.ft.com/cms/s/2/512d389c-b23b-11db-a79f-0000779e2340.html" target="_blank">http://www.ft.com/cms/s/2/512d 389c-b23b-11db-a79f-0000779e2340.html</a> Now that is only a small amount of money for the Disney Company. However, almost everyone views this at the future. Is that even the issue of the strike? Yes, this is a very, very big issue. The writes got screwed with DVD and don't want that to happen again.
Originally Posted By Sport Goofy << Yes, this is a very, very big issue. The writes got screwed with DVD and don't want that to happen again. >> Sure, but if Apple is getting the bulk of the revenues from internet downloads, or if Google is generating the ad revenue from YouTube, or Tivo is running their own ads on recorded TV shows -- why are the studios expected to pay the writers when they aren't participating in the revenue stream to the same extent that they were under the old distribution model. The writer's should get a cut of revenues, but who do they get it from. The traditional media content providers aren't playing as big of a role in the new media environment and smaller players are pouncing on the opportunity to get revenues from content they don't produce.
Originally Posted By BlueOhanaTerror Eventually, there will BE NO DVDs. Everything will be downloads/zapping/what-have-you. The storage media will be whatever you carry in your hand or some kind of adjunct, TIVO-like device in your home. It's very possible that there will be NO hard media collections, perhaps within the next 15 years. So if there's no internet, then there's pretty much NOTHING in terms of residuals, left. And the writers know this, the actors know this, the directors know this. Whatever the WGA negotiates, the Producers will have to pay 3 times that amount (by a standard formula) in any agreement that consequently is forged with the Screen Actors' Guild. The Studios are greedy, yes. But they don't particularly hate writers or the WGA. They DO hate SAG, however. SAG's leadership has traditionally made most of the other unions look like little lambs. They are ruthless when it comes to penalties and holding producer's butts to the fire. So what's at stake here is not really the puny residuals that Writer/Creators make for the movies and TV so many people enjoy, and from which so many people (including actors) get their jobs. It's really the Actors. Their contract is up June 30, and there's absolutely no question (trust me, I know members of their board) that they will strike.
Originally Posted By vbdad55 Someone please notify Al Gore -- maybe he can work on a second Nobel by saving his creation
Originally Posted By dshyates The bottom line is if the writers, actors, producers, and everyone else knows that once you release something in any media format it is available for free on the internet. So the people who produce this stuff will start getting their money for the product before it ever leaves the shop. The distribution networks can't distribute what they don't have.
Originally Posted By mawnck I don't follow you, dshyates. Nobody would get any residuals if the show doesn't get distributed.
Originally Posted By BlueOhanaTerror >>>Wait... There's not going to be any internet?<<< Are you serious? If Internet residuals are eliminated altogether, then, EVENTUALLY, Writers will not get any residuals, at ALL. Because eventually, there will be no DVDs. There will be no hard media. Everything will be downloaded, etc. What's at stake is not merely getting some token additional revenue for writers (and actors and directors), but getting ANY residuals at all. There's some foresightedness going on here. Is that any clearer?
Originally Posted By mawnck >>Are you serious?<< Your post #7 had a typo in it, BOT: >>So if there's no internet, then there's pretty much NOTHING in terms of residuals, left.<< We know what you meant. You are being taunted good-naturedly.
Originally Posted By Sport Goofy << Because eventually, there will be no DVDs. There will be no hard media. Everything will be downloaded, etc. >> Why does compensation have to based on the delivery platform? I would think that a straightforward compensation plan based on total revenues, regardless of distribution method, would benefit everyone. Both the writers and the studios are setting themselves up for long-term failure by not thinking outside of the box of how these contracts have been negotiated before.
Originally Posted By BlueOhanaTerror >>>>>Are you serious?<< Your post #7 had a typo in it, BOT: >>So if there's no internet, then there's pretty much NOTHING in terms of residuals, left.<< We know what you meant. You are being taunted good-naturedly.<<< I appreciate that, but it's not a typo. It's simply the way we talk. "Internet" refers to any internet residuals, period. If you wipe out any references to "new media", there's nothing left. It's just the way people talk. >>><< Because eventually, there will be no DVDs. There will be no hard media. Everything will be downloaded, etc. >> Why does compensation have to based on the delivery platform? I would think that a straightforward compensation plan based on total revenues, regardless of distribution method, would benefit everyone. Both the writers and the studios are setting themselves up for long-term failure by not thinking outside of the box of how these contracts have been negotiated before.<<< Obviously you've never dealt with studio accountants. They LOVE jiggling figures. Heck, Jim Hill is trying to persuade everyone (granted, he's just embarrassed and trying to save face) that after grossing over $600 million worldwide, RATATOUILLE has still not broken even. But there's plenty of studio accountants who routinely cook books to avoid paying out residuals, and though you can PUT a clause in a contract about making them subject to audits, it really doesn't happen. It's not practical and hardly enforceable. I'm in a situation NOW with a smaller distributor about a project where they cooked the books. In this case, they stole money by claiming the opposite: By cooking the books to simply claim they sold more UNITS than they did, they not only dilute the price per unit, they can charge more PER UNIT of their manufacturing cost, therefore robbing the producer (my associates) of their due per unit recoupment. And these jokers were four months late with their financial statement. I guess that's how long it takes to cook the books. Point simply being, this is a smaller distributor, and the studios and big distribution outfits pay six-figure salaries to a lot to very smart people who do this sort of thing all the time. SO, the only way to really "audit" how sales are going and how distribution is occurring, is to USE distribution of units as a sales marker. It's hard to fake those, as the number of units sold per larger distributors is information that's disseminated widely in the industry among various conduit publications, almost immediately. It may not be thinking outside the box, but distributors have a lot to protect, and an infrastructure that insulates them from peering eyes. There's only one good way right now, to gauge revenue, and that's number of units sold. I don't know how publicly accessible internet download clicks are, but I'm guessing there's a good way to audit all that as well.
Originally Posted By Kar2oonMan >>Obviously you've never dealt with studio accountants. They LOVE jiggling figures.<< I always thought that was casting directors?
Originally Posted By Sport Goofy << There's only one good way right now, to gauge revenue, and that's number of units sold. >> It's really a horrible way to gauge revenue because it only works if you know the cost structure for a single distribution source. In the internet age, the revenue model will differ dependent on the distributor. A studio will make less revenue when Apple sells the product on iTunes than if they stream the title themselves on their own ad-supported website. How do you differentiate? Both writers and studios are ensuring their ultimate demise by negotiating this way. Someday we'll all be wondering why there's nothing left to watch except reality TV shows, game shows, sports, and remakes of movies from the past decades.
Originally Posted By mawnck >>It's simply the way we talk. "Internet" refers to any internet residuals, period.<< Oh.
Originally Posted By BlueOhanaTerror >>>It's really a horrible way to gauge revenue because it only works if you know the cost structure for a single distribution source.<<< I don't disagree, but currently there isn't a governing body that really is trusted enough, or at least has enough granted authority, to audit inventories/orders/revenues/replacements & refunds (and as you can imagine, it would be a whole lot of work just to do that for a SINGLE company). The big distributors are ALL about cooking books. They have all sorts of ways to do it. They even laugh about it (I've been in the room when they've been laughing about how clever they are at the process of hiding revenues/profits). >>>In the internet age, the revenue model will differ dependent on the distributor. A studio will make less revenue when Apple sells the product on iTunes than if they stream the title themselves on their own ad-supported website. How do you differentiate?<<< Actually, right now, distributing on Apple is EXTREMELY profitable to the studio. Apple only keeps a smallish fraction (about 15 percent, I believe) of the download charge. The rest goes right to the releasing studio/production outfit. This is standard regardless of whether it's an independent film or DIE HARD 4. Yes - when Studios distribute themselves, they'll eliminate that middleman, but right now, there's the challege of creating "destination ports" on the web that people habitually migrate to. They're afraid of Jobs. They won't always be. They'll realize that with adequate marketing, they can get people wise to their brand and those folks will find their site. And they'll keep that extra 15%. But when THAT happens, there'll be pretty much NO way to ensure they're honest about accounting for how many downloads they've sold. So we're all really heading into the Wild Wild West here.
