Wednesday, March 15th, 2006
This is effectively the other shoe, the impact of the iTunes ‘Music’ Store as a vehicle for distributing what once was simply broadcast content. Disney(ABC), known for being, well, cheap in their dealings with creatives, has taken what may well be an available loophole in determining compensation to writers for downloaded episodes (versus those bits you buy at Target on a silver DVD platter). A letter to Writers Guild members from their leadership says:
We are writing to confirm what you have undoubtedly already heard: Last week, the Walt Disney Company informed our Guilds (along with SAG and the DGA) that they intend to pay residuals for Apple iPod downloads at an inappropriate, discounted rate.
Needless to say, this unilateral decision by Disney was met with disappointment and righteous indignation by virtually the entire talent community. All the Guilds, jointly and individually, issued public statements asserting their anger and warning of the likely consequences.
To put a fine point on what this means, Disney is claiming that Apple is not the distributor of our content, but merely a “retailer” or “exhibitor.” Disney claims that they are the distributor and, as a result, they assert that they can use a lower formula created for Beta and VHS tapes. Disney and the other companies have refused for years to adjust this outdated formula for the DVD market and now they are trying to do the same thing with the next generation of technology. On each $1.99 download, Disney will receive $1.40 but pay us on only 20% of that amount, or 28 cents. Accordingly, our residual will be less than half a cent per download. On Monday we received the first check for an episode of LOST, which was downloaded nearly half a million times. The amount of the check was $3,688.59. Had Disney paid under the correct formula, the check would have been over $14,000.
We take this action by Disney as a call to arms. Disney purports to be a leader in technological media advances. We support those advances but not without fair compensation for the hardworking men and women who write, perform, direct, and otherwise create the very content that makes their new revenue streams possible. Rest assured, our Guilds will take all affirmative legal action within our power to see that this inequity is resolved to our benefit.
Hmpf! Took me a couple of times to go through it, but what they’re asking for is (correct me if I’m wrong) that instead of a half-cent per download from Disney’s $1.49 share of the $1.99…they want 1.8977441 cents. Or, calculated slightly differently (assume they want a full five times as much), up to four cents. Yee gads, that seems fair to me! Heck, give the creatives five cents of each one!
I would love to see a detailed look how the whole $1.99 pie gets divvied up (including what chunks the directors and actors get)…the outcome I certainly don’t want is that Disney and others take the easy way out and force up the price of individual episodes (I have the same concern in the face of greedy record companies hankering to break up the 99 cent US price point at the ITMS.) These downloads must remain at the “sure, why not” pricing threshold or this clever experiment will evaporate…or go somewhere else.
I’m really amazed how much money the media companies are willing to walk away from in a bid to install a model of entertainment “borrowing” that basically removes the idea that you can “buy” a thing and watch it or read it or listen to it wherever and whenever you want. That draconian approach is, I suppose, the perfect partner to a paranoid government and other rights-deprivations that are becoming part of our daily life.
But that’s just my five cents’ worth.