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Wisdom Of The Staircase, Writer’s Strike Edition

Posted by: Jon Fine on February 11, 2008

I went on CNBC this morning at an obscenely early hour to do this segment(possibly firewalled) with Vanity Fair columnist and fellow CNBC contributor Michael Wolff.

We discussed the all-but-official settlement of the writers’ strike, and Wolff’s short take is that the Writers Guild lost:

This is what they got: 2% of nothing . . . 2% in the third year of nothing. It is not nothing now; it will be nothing always. There is a very important wrinkle here. They didn’t get 2% of the online revenue stream. The online revevenue stream is advertising. They didn’t get that.

Two thoughts occur to me now.

1. Is there any situation in which the networks would split ad revenues with writers?

2. So since there is no massive revenue stream from paid online content now, there never will be—and thus the writers shouldn’t have pushed for what they got. which is a precedent to have some claim on some future online revenue streams? Or should they have pushed for a share of ad revenues, which was guaranteed to fail?

Not that I said any of this on the air, because--my bad!--I had yet to push the lack-of-sleep-cobwebs out of my brain. (I still have yet to, for that matter.)

Am I right? Is Michael right? Post your comments and let me know.

Reader Comments

ben schwartz

February 16, 2008 10:15 PM

What's really missing from the Wolff-Fine summit is CNBC coming back from that commercial and Jon Fine saying to Michael Wolff, "Dude, you're getting a Dell."

But, re the WGA stike and your questions:

1. There is such a situation, when the networks have no choice. They recently split ad revenue with the SOUTH PARK guys and their deal last year. Every blogger in existence owns their own ad revenue, writers need to work without networks on-line.

2. What Wolff doesn't seem to get is that the studios were offering NOTHING prior to the strike. NOTHING. The studios caved in only three months. As Jon pointed out, the WGA held them to the point where real, permanent damage was going to be done to the superstructure of tv. That was our major demand. Wolff is also wrong that advertising is the only business model of the internet, as anyone who as ever visited iTunes can attest. Does anyone believe Michael Wolff (or anyone else) knows where internet revenue is going to come from in three years much less three minutes ago?

Overall, I agreed with Cynthia Littleton’s assessment in VARIETY the other day. VAR. has been considered AMPTP-friendly during this whole thing, and even they credited the WGA with making the DGA deal much more attractive to the producers in a good cop/bad cop way.

According to Littleton, the loss for the WGA is in the current deals cut and the salaries lost. Quite true, some writers lost a lot, and the WGA won thru their sacrifice, but Littleton and most media watchers seem to think a) the WGA members never saw that coming when they voted to strike and b) that this deal is about money made in the short term. Wolff talks of it as a three-year plan, but it's the money to be made over the next decades that this was about.

What was in the minds of so many writers is the terrible 1988 deal on the vhs/dvd market, in which we underestimated the value of the new market and agreed to low initial rates until that market grea. Later, studios refused to adjust as it succeeded. 20 years on, it holds back writers to this day. It’s why writers jumped on this moment to get hold of the Internet, which they did in three months. That was the point of this strike, and we won it.


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