Contract Negotiations

The New York Times reports that in the forthcoming negotiations between Hollywood studios and writers, actors, and directors the industry executives may ask for a complete overhaul of the system of payment of residuals.

The industry executives declined to discuss specific contract proposals. But they said they would adamantly oppose any move to extend residual-like payments to the sale of movies and shows on the Web or in other new media. They repeated an earlier call for a study that would, in effect, defer decisions about such distribution channels for as long as three years.

"We need complete flexibility," said Ms. Sweeney, who described broadcasters as being in a desperate scramble for revenue as consumers increasingly turn to online sources for programs that are often stripped of advertising. "Guild restraints limit our ability to do what we need to do," she said.

I suspect if the industry had total freedom it wouldn't bother with payment at all.